Economics

KPN is going to cut 350 million euros in the coming years

-November 28, 2018

KPN will cut about 350 million euros over the next three years to make investments in the data network possible. Among other things, the mobile network has to be updated to 5G, the company announced Wednesday on the investors’ day. In order to save the millions, labor costs are cut. How many jobs are at stake, KPN can not say exactly…

According to a spokesman, the austerity does not translate directly into job losses. This is due to the fact that both internal and hired staff are cut back. How that distribution works for its own staff is still unclear. It is possible that part of the employees within the company will be relocated. Currently the telecom giant has about 13,000 full-time jobs.

A reorganization was already expected as the conern has been dealing with declining turnover for some time. The Colombian-Italian Maximo Ibarra has had to change that since April this year. He replaced CEO Eelco Blok who stepped down as chairman of the board after seven years.

In the past five years, KPN has already reduced the costs by 650 million euros by, among other things, cutting staff costs. Last year, the telecom company received a further 300 million euros less than in 2016. According to KPN, this had to do with new EU rules, for example, which prohibit high charges for data roaming (internet and calling abroad). Also, more customers would opt for a generally cheaper SIM-only subscription, instead of a package with device.

KPN wants to build a 5G network, among other things, that makes higher internet speeds possible. KPN wants to increase the investments in the new data network to 1.1 billion euros, according to news agency ANP. Telecom companies are currently in the start-up phase of a newer and faster data network, which should also enable new applications in cars and agriculture.

Competitor T-Mobile also promised so fast mobile internet before 2020. This week it was also announced that the company may merge with Tele2, giving KPN and VodafoneZiggo a strong competitor.

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