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Telekom headquarters emptying

June 22, 2012

Deutsche Telekom has announced that it will lay off hundreds of employees at its administrative headquarters in Bonn in a bid to cut costs. The telecommunications giant has been struggling with a declining core business.

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Traffic lights in front of Telekom HQ in Bonn, Germany
Image: AP

Up to 1,300 jobs will end by 2015, the company announced on Friday. Officials said the drastic measure was part of a wider cost-saving drive over the next couple of years.

Telekom thus confirmed earlier reports by the Financial Times Deutschland that some 40 percent of the Bonn staff would have to leave. Eight hundred people would be laid off before the end of the current year under conditions yet to be negotiated with trade unions, the telecommunications leader said.

The announcement emphasized that the cuts would affect all pivotal business segments, including the purchasing and marketing departments.

Strategic reorientation

According to Telekom, the layoffs would not be accompanied by additional measures that might hamper the firm's current restructuring endeavors.

The firm has seen its core fixed-line business decline for years. Its US mobile operation has also suffered from fierce competition.

The goal is for Deutsche Telekom to strengthen its new and more lucrative fields of activity such as mobile Internet services and digital in-house networking. For the time being, though, initial revenues gained in those areas are too low to compensate for Telekom's losses elsewhere.

hg/mkg (dpa, dapd)