Mobile operator SFR may have to slash up to 500 jobs as owner Vivendi attempts to reverse an earning slump, a union official told Bloomberg.
Vivendi has been reviewing SFR following the launch of low-cost service provider Free Mobile in January and the loss of more than 200,000 subscribers. The company is looking for ways to offset a projected fall in earning of as much as €570 million by cutting hundreds of marketing and administrative positions.
"We've been told to expect more positions will be cut than initially planned. It could be 200, 500 or even more on top of the 120 cuts that were already decided," union representative Damien Bornerand told Bloomberg. "It's tough to say how big it will be."
Given that SFR set its 2012 budget prior to the launch of Free Mobile, the company's managers are now being asked to identify cost-cutting opportunities with the aim to implement any changes by June 2012. The job cuts will be discussed next month and employees may be shifted from one project to another or made redundant, the union said.
Vivendi CEO Jean-Bernard Levy said last week that SFR will need to adapt its structure, capital expenditures and operating expenditures to meet new market conditions. The company has already slashed its dividend payments to shareholders in anticipation of what it says will be two difficult years.
Vivendi acquired full ownership of SFR last June when it paid Vodafone €7.95 billion for its 44 per cent holding in France's second largest mobile operator.
- see this Bloomberg article
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