Telkom is using jobs cuts to influence spectrum auction – CWU

Communication Workers Union president Clyde Mervin said Telkom’s planned job cuts are all about trying to influence the upcoming spectrum auction.

Telkom is planning to retrench as many as 6,000 employees this year, blaming the current regulatory environment and having to compete “in a duopolistic mobile market”.

The company said it has invested in new technologies and revenue streams, particularly in its mobile business, which have taken their toll on profitability.

Telkom also blamed difficult economic conditions, declining voice revenues, and having to reposition itself amid fundamental changes within the telecommunications industry.

Mervin, however, dismissed these excuses. He told CNBC Africa the real reason behind the threat of job cuts was to “bulldoze” the spectrum auction.

He said Telkom is using the planned job cuts as a negotiation tool to influence the spectrum auction because the company is currently not guaranteed to receive additional spectrum.

According to Mervin the documentation related to the planned job cuts clearly references spectrum and the regulatory environment.

He said the CWU was in favour of Telkom receiving additional spectrum, though.

“What we are saying [is] government must be able to look at spectrum correctly and give it correctly to Telkom,” said Mervin.

He hinted that this was fair because Telkom helped Vodacom to grow by allowing the mobile operator to use its infrastructure.

No comment from Telkom

Telkom was asked for comment regarding the statement from Mervin, but the company did not respond.

Now read: Telkom blames Vodacom and MTN for its problems – Here is the truth

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Telkom is using jobs cuts to influence spectrum auction – CWU