Optus CEO Allen Lew at the Optus campus in Macquarie Park.
Optus CEO Allen Lew at the Optus campus in Macquarie Park.

Optus to cut hundreds of jobs

OPTUS has told staff it will cut hundreds of jobs as it reshapes its workforce to deal with an increasingly competitive mobile market and shrinking margins.

Fairfax media reported this morning that staff were informed by e-mail and in meetings that the telco intended to cut about 440 jobs in the coming two months as it looks to improve the automation and digitisation of its workforce.

An Optus spokesperson confirmed to news.com.au that the cuts will take place as it seeks to become a "next generation" company.

"As we continue to evolve the way we work, do business and fund future investments we are removing duplication, improving our operating efficiency and embracing next-generation technologies, like digitisation and automation to achieve this goal," the spokesperson said.

"As a result, certain roles will be impacted, including 440 roles being made redundant."

It's part of the company's efforts to deal with a changing industry and follows previous job cuts from the telco.

"We are structuring our organisation to become the next-generation Optus," the spokesperson said.

"We are speaking with affected employees first, and discussing redeployment opportunities where available."

In May, the company announced it would cut about 400 jobs across the company in separate redundancies. That came the week after it decided to cut 200 jobs and close 36 stores nationwide as it pulled the plug on its Virgin Mobile brand.

Similar to the earlier cuts, the latest round of job losses is expected to affect management, administration and areas of duplication across the company, which had 8526 staff at the end of the last financial year.

Optus has not been alone in its need to shed workers. In June, Telstra announced it would slash 8000 jobs from its workforce as part of a new strategy to "improve customer experience, simplify structure and cut costs".

The massive overhaul of the legacy telco amounted to riding roughly a quarter of all employees and included one in four executive and middle management roles.

The country's two major telcos are grappling to reinvent themselves as the NBN rollout takes away home broadband revenue and a fourth mobile provider, TPG, prepares to enter the market.



Also on Wednesday morning, reports emerged about a potential merger between Vodafone's Australian division and TPG.

TPG Telecom confirmed media speculation it is in talks with Vodafone Australia regarding a potential merger of the two telco companies. In a statement to the ASX on Wednesday, it said it has held exploratory discussions with Vodafone regarding a "merger of equals" between the competing companies.

"The TPG Board notes that there is no certainty that any transaction will eventuate or what the terms of a transaction would be," the statement said.

Telecommunications expert Paul Budde said such a move would make "business sense".

"While I would have loved to see TPG entering the mobile market to bring some good competition to it, in the end business sense has prevailed and Vodafone and TPG have decided to look at merging both companies," he said.