LONDON — Telewest, the U.K.’s second-biggest cable operator, is cutting approximately 1,400 jobs, representing 25% of its workforce.
The cuts — announced along with Telewest’s six-month results — are both a cost-cutting move and a restructuring.
Stephen Davidson, Telewest’s chief exec, said: “Telewest’s network is 70% complete, substantially more than the industry average. It is now appropriate to reduce the pace of the build program, and to shift the emphasis to sales and customer service.”
The U.K. cable industry is still heavily in debt after years of investment and disappointing consumer take-up.
Telewest, for example, posted an operating loss of $96 million for the half-year ending June 30, approximately the same amount it lost in the same period last year. The company expects to save $64 million from the job cuts in the first year.
A statement accompanying the results also seems to indicate that Telewest intends to delay its digital plans — once mooted for as early as late this year — until satcaster British Sky Broadcasting launches its digital platforms next summer. BSkyB supplies the U.K. cable industry with its key programming.
No further light, however, was shed on talks for a possible merger between the U.S.-owned operator and NTL, a communications company parented by the American company CableTel (Daily Variety, Aug. 5).
Should Telewest and NTL merge, the new company would supplant Cable & Wireless Communications as the U.K.’s largest cable operator. Analysts have long pointed to consolidation as a way to help mitigate the British cable industry’s woes.