Price of 2001 merger? Virgin Media O2 is to axe 12 percent of its workforce, as it seeks to “simplify” its operating model
Virgin Media O2 has confirmed it is proposing to axe up to 2,000 jobs in its UK business by the end of 2023.
Virgin Media O2 has roughly 17,000 employees, so the loss of 2,000 jobs will mean the carrier is axing appropriately 12 percent of its workforce.
Virgin Media O2 is jointly owned by Liberty Global and Telefonica, and the venture was formed when Virgin Media (owned by Liberty Global) and mobile operator O2 (owned by Telefonica) agreed in 2020 that they would form a 50:50 joint venture.
The deal was finalised in 2021, after gaining clearance by the UK competition regulator, the Competition and Markets Authority.
The joint venture combined Virgin Media’s broadband, TV, mobile and landline services with the mobile operations of O2.
Prior to the merger O2 had been valued at £12.7 billion and Virgin Media valued at £18.7 billion.
At the time of the merger there was no mention of job losses, and Virgin Media O2 confirmed to Silicon UK that since that time net headcount at the combined entity had “broadly remained flat.”
But now the carrier is proposing to reduce up to 2,000 roles across its business by the end of the year.
This includes the 800 job losses reported last month in some UK newspapers.
“As we continue to integrate and transform as a company, we are currently consulting on proposals to simplify our operating model to better deliver for customers, which will see a reduction in some roles this year,” a Virgin Media O2 spokesperson told Silicon UK in an emailed statement.
“While we know any period of change can be difficult, we are committed to supporting all of our people and are working closely with the CWU and Prospect along with our internal employee representatives as we have open and honest conversations on the future direction of our business,” the spokesperson added.
Virgin Media O2 said that since the joint venture was formed two years ago, it has invested around £4bn in capex.
It said it will continue to invest across key areas of its business including expanding and upgrading its networks; improving its products; transforming customer service; launching new digital capabilities; and investing in its people and office sites.
It should be noted that Virgin Media O2 is not alone in cutting jobs.
In May this year BT (owner of EE) announced that it will cut 42 percent of its workforce by 2030, which translates to 55,000 job losses.
Vodafone meanwhile, which is in the process of acquiring rival operator Three UK, announced earlier this year that it will axe 11,000 jobs as part of its turnaround plan under its new CEO.