Virgin Media O2 set to cut thousands of jobs, possibly up to 4,000 of 16,000, as owners tackle £22 billion debt

Virgin Media O2, one of Britain's largest broadband and mobile companies, is preparing to cut thousands of jobs as it tries to reduce costs under about £22 billion of debt, according to reports on Sunday, November 1. People familiar with the plans say the total could reach 4,000 of its roughly 16,000 employees, a quarter of the workforce, though the final number has not been settled.

The company, jointly owned by Liberty Global and Spain's Telefónica, is due to publish third-quarter results on Tuesday, November 3. It is expected to give its cost-saving target as a figure in pounds, without a headcount. One insider said the numbers were still moving.

Which staff are most exposed

Redundancies are expected over the coming months. Roles that do not deal directly with customers are said to be most at risk, and several senior leadership changes are already happening under chief executive Lutz Schuler. A review of suppliers and contractors is also expected, which could spread the effect to outside firms.

Officials at the CWU and Prospect unions have been told about parts of the plan, according to reports. Neither union had issued a detailed public response by Sunday night.

The debt problem behind the cuts

What	Figure
Total debt	About £22 billion
Reported savings target	About £600 million
Current workforce	About 16,000
Upper estimate of job losses	4,000 (one in four)
Last big round, in 2023	Up to 2,000 jobs

Investors have grown nervous. The company's bond prices fell sharply over the summer, and in July its owners were reported to be looking at cuts to dividends and capital spending. That is a hard position for a business which has to keep paying to build fibre networks while it loses ground in a crowded broadband market.

It is also looking to expand without building everything itself. Reports last week said it was close to a deal to use rival Openreach's network, which would lift its reach from 19 million homes towards as many as 25 million.

A shrinking British telecoms workforce

Virgin Media O2 is not alone. BT plans to shed up to 55,000 jobs by the end of the decade, partly through automation, and Vodafone Three has announced more than 1,700 job cuts following its merger. TalkTalk, weighed down by about £1.5 billion of debt, narrowly avoided collapse before BT bought it out of administration, a deal rivals say strengthens BT's grip on the market.

What it means for customers and staff

No change to customers' contracts, services or prices has been announced in connection with the cuts. Customers may want to watch for what follows: a company under debt pressure tends to look for more revenue as well as lower costs, and UK broadband and mobile users have already faced repeated annual price rises across the industry.

Employees should have a clearer picture once formal consultation begins. Under UK law, a company proposing 100 or more redundancies at one establishment must consult for at least 45 days before the first dismissal takes effect, so the first departures from any large round would not come immediately.

The company has not said which sites could be affected, or which departments outside the customer-facing teams would carry most of the cuts.

The first hard number arrives on Tuesday, when the company reports its results and sets its savings target.