The British cable TV company NTL has announced it is cutting its workforce by about a third – 6,000 jobs – following its merger last year with rival Telewest.
It is part of the annualised 366 million euros of cost savings NTL promised from the five billion euro merger.
NTL and Telewest both have a reputation for poor customer reputations and telecoms analyst Angel Dobardziez said this may not help: “Clearly these are drastic cost cuts – it’s a third of the work force – with some outsourcing as part of that, and there is the potential that customer service may deteriorate as a result of it and rather than improve NTL’s reputation, actually do some further damage.”
NTL is the biggest British cable company serving 12 million homes, but it lost over 350 million euros last year and has 3.3 billion euros of debt.
NTL is in the process of buying Virgin Mobile from Sir Richard Branson to add mobile phone service to its product line, but also – as part of a licencing deal – it will change its name to Virgin.
Industry expert Chris Williams, from uSwitch.com, explained the logic of that move: “It’s two things. It’s being able to offer mobile to their customers, alongside land-line telephony, digital television and broadband. Secondly it’s the chance to liven up the NTL brand and to benefit from the good customer service and good customer experience that Virgin is also know for.”
Already the so called “triple-play” policy – that is customers subscribing to TV, broadband and phone services – does seem to be paying off.
The percentage of such customers increased to
34.9% in the first three months of 2006, from 26.8% a year ago.