Cingular To Cut Workforce By 10 per cent

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Amidst the recent merger, Cingular Wireless LLC will cut about 10 per cent of its 68,000 jobs over the next 12 to 18 months as it combines operations with AT&T Wireless, the chief executive of the nation's largest cell phone company said in an interview.

Many of the 7,000 or so job cuts will come from administrative ranks, while relatively few if any would come from customer service, CEO Stan Sigman told The Associated Press.


No cuts are expected until January to prevent disruptions during the key holiday-selling season. Company officials are still working on the exact numbers, and the cuts will be spread out over more than a year, he said.
Sigman stressed that Cingular's goal would be to hire those employees back over time as the company expands its current subscriber base of 47.25 million.



Cingular, a joint venture of Atlanta-based BellSouth Corp. and San Antonio-based SBC Communications Inc., hopes to achieve billions of dollars in cost savings through the merger, which gave the company about 5 million more subscribers than former market leader Verizon Wireless.


After completing the $41-billion US purchase of AT&T Wireless Services Inc. last month, Cingular asserted that no decisions about jobs cuts would be announced until the start of 2005.


The expected cuts are not related to the 10,000 or more positions which SBC recently disclosed plans to eliminate. Those cuts, about six per cent of SBC's work force, are to be made by the end of 2005 through a combination of layoffs and attrition.


Some analysts have suggested that Verizon Wireless, which has 42.1 million customers, could eventually retake the No. 1 spot because it has been adding customers at a much faster rate than Cingular.


Also, since both Cingular Wireless and AT&T Wireless are already losing customers to rivals at a faster rate than Verizon, any service glitches during the integration of the two businesses could prove costly.


But Sigman, who at times pounded his fists on his chair to emphasize a point, asserted that the merger is running smoothly so far and that he is committed to holding the No. 1 spot.


Cingular charges from 52 cents to $1.25 a month for regulatory recovery, while AT&T Wireless charges $1.75. Asked about his future, Sigman, a 57-year-old Texas native, said he plans to stay on as CEO for some time. He's been in the industry for 40 years.