Cost containment leads to the dismissal of 17 thousand France Telecom employees

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As a result of the cost containment strategy announced in February, France Telecom announced that 9.4 thousand people will be dismissed in this first year. Initially, the operator had the intention of firing 22 thousand employees, which came to be changed, now fixing itself in an effective reduction of 17 thousand employees until 2008.

According to Associates Press, the redundancies will consist of early retirement operations and the non-replacement of employees who intend to retire.

The Portugal Telecom shareholder aims to reduce wage costs, at a time when France Telecom is struggling with the loss of profits caused by competition from other operators.

The redundancy plan caused discontent among unions and workers, which yesterday led to a strike of 17 percent of France Telecom’s total workers.

At the same time, the French company announced yesterday in a statement that it will invest 270 million euros, over the next two years, in the construction of a fiber optic network in France in order to compete with Iliad SA.

The operator plans to connect between 150 and 200 thousand customers to the Internet by broadband access by 2008. In the press release, France Telecom shows its intention to connect Paris to the fiber optic network as early as March next year. The service will be continually extended to other regions, with Lyon and Marseille receiving the same offer from June.

The services offered by the company will vary between Internet access, with speeds above 100 Mbps, high-definition television and unlimited telephone calls.

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