AT&T Canada cuts workforce by 20 per cent

AT&T Canada is chopping about 1,000 workers as part of its plan to reduce spending by $80 million and “refocus its business activity,” the company said Thursday.

The cuts will reduce AT&T Canada’s workforce to about 4,200, and were announced at the same time as a first quarter loss of $157.6 million. The company also had significant layoffs last year, trimming 650 jobs in 2001.

Considering this performance, and the severe pressure on all telecoms to reduce debt, these cuts are not surprising, said Brownlee Thomas, a Montreal-based senior telecommunications industry analyst with Giga Information Group. With AT&T underperforming internationally, it’s only natural that the company’s Canadian wing has to take its lumps as well, she added.

“Sometimes it doesn’t even matter if you don’t have any fat, you’re still going to cut,” Thomas said.

At press time, the company had not responded to IT World Canada’s questions about the types of positions being axed, and what effect, if any, the layoffs might have on users of AT&T Canada’s products and services.

However, in a written press statement John McLennan, vice-chairman and CEO of AT&T Canada said that the Canadian telecommunications industry is undergoing fundamental change, but the result of these measures “should be greater operating efficiency and financial strength, and a sharpened focus on the service we provide to our customers.”

Thomas said AT&T Canada has probably decided that by consolidating its staff and focussing on the areas where enterprises, head offices and IT budgets are located, it can still keep up an adequate local presence. They will likely outsource technicians and service calls, she said, and focus on the geographic areas where they are competing most effectively with Bell Canada and Telus Corp.

“Where IT users are going to feel some blips are in post-sales, support and account managers,” she said.

Before familiar faces start to disappear, Thomas suggested that AT&T Canada customers take a close look at their service level agreements and discover exactly what the problem-escalation procedures are for their services, and what, if any, penalties AT&T will face if service deteriorates.

AT&T Canada is online at

The Giga Information Group is online at

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