By Sohaib Shams
Virgin Media O2 has confirmed plans to axe thousands of UK jobs as it targets annual cost savings of around £800 million by 2029. The telecoms giant, jointly owned by Liberty Global and Telefónica, said the bulk of the savings – about £300 million – will come from reductions across its 16,000-strong UK workforce, aiming to cut staff costs by roughly 30%.
Job cuts to deliver £300m savings
The company did not specify the exact number of roles to be lost but stated most affected positions would not be customer-facing. Senior leadership roles have already been reduced, and the overhaul is expected to focus on head office, IT and support functions.
Restructuring focuses on head office and IT
Virgin Media O2 will also review its use of contractors and suppliers as part of the cost reductions. The group plans to ramp up artificial intelligence to support faster decision-making and delivery.
AI adoption and contractor review
Chief executive Lutz Schuler said the decisions were tough but necessary given market conditions, the regulatory backdrop in fibre and technological changes across the economy. He pledged that departing staff would be treated fairly and with respect.
CEO says tough decisions necessary
The firm said there were no plans to close any of its UK offices, which include sites in Paddington, Reading, Leeds, Manchester and Glasgow. Half of the annual savings – £400 million – are targeted for next year, with most affected workers to be informed by February. The restructuring will incur about £250 million in one-off costs.
No office closures planned
As part of the strategy, Virgin Media O2 will halt further fibre network building and instead focus on upgrading its network to 2Gbps speeds, which it described as a lower-cost option. Full details of the UK changes will be given at the full-year results in February.
Half of savings targeted for next year
The company is grappling with a debt pile exceeding £22 billion and faces increasing competition from cheaper alternative broadband providers and BT, which recently expanded its market share through the emergency takeover of TalkTalk. Virgin Media O2 criticised that deal as a "stitch-up masked as a rescue deal in the public interest".
Debt and competitive pressures mount
Regulatory scrutiny is also mounting. The Competition and Markets Authority has provisionally found concerns over plans by Nexfibre – a joint venture backed by Liberty Global, Telefónica and InfraVia Capital Partners – to acquire alt-net provider Netomnia for £2 billion.
Regulatory scrutiny over Nexfibre deal
Third-quarter results showed service revenues fell 3.5% in the three months to September 30, with a net loss of 23,300 fixed-line customers. Consumer fixed annual revenue per user dropped 5% to £45.83, reflecting competitive intensity and the phasing of annual price rises. Underlying earnings fell 2.6% as a 5.4% cost reduction failed to offset the revenue decline.
