Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, August 16, 1994 TAG: 9408160101
SECTION: BUSINESS PAGE: C-8 EDITION: METRO
SOURCE: Associated Press
DATELINE: PHILADELPHIA LENGTH: Medium
With the announcement, Bell Atlantic became the latest big telephone-service provider to sharply cut its work force while touting plans to create a better network for voice, video and data.
Phone companies have taken such actions because of advances in technology and the expectation that regulatory changes eventually will open their monopolies to competition.
According to Bell Atlantic-Virginia spokesman Paul Miller, 800 of 7,400 Bell Atlantic employees in Virginia will be affected by the job cuts. The cuts will be spread across the state and across all company departments, he said.
Immediate figures were not available on how many workers Bell Atlantic has in Southwest Virginia and the Roanoke area.
Bell Atlantic also became the second big phone company to change its accounting practices to conform with those of a competitive, nonregulated business. US West Inc. made a similar step last fall.
Most of the $2.3 billion restructuring cost is a reflection of these accounting changes, which will be reported as a charge against earnings in the company's current fiscal quarter.
Analysts note Bell Atlantic already is one of the most efficient of the so-called Baby Bell companies created after the breakup of AT&T a decade ago. It has cut 10,000 employees since 1991 and now employs 73,100.
Bell Atlantic's latest cut is smaller than what others have recently announced. Nynex Corp., for example, plans to cut 16,800 during the same period.
``The ability to manage a network is much more software-intensive and much less people-intensive,'' said Liam Burke, an analyst at Ferris Baker Watts Inc., a Baltimore-based securities firm.
``It's a bunch of clerks in front of a screen that can make adjustments with a keystroke,'' Burke said.
Bell Atlantic president James D. Cullen vowed customers would see better service.
``Our objective is not in satisfying, but delighting, customers,'' he said. ``This is being seen very clearly that we want to invest in the future of the network.''
The cuts will cost the company $100 million in severance and retirement packages. Bell Atlantic also faces a $35 million to $45 million charge related to the sale of certain nonstrategic investments.
Bell Atlantic's stock was trading down 75 cents at $56.871/2 on the New York Stock Exchange on Monday afternoon.
Bell Atlantic said the job cuts will be distributed evenly across the company but won't involve its cellular business.
Besides Bell Atlantic and Nynex, other large phone company cuts announced in the past year include GTE Corp., 17,000 jobs over three years; Pacific Bell, 10,000 jobs over three years; and US West, 9,000 jobs over three years. Ameritech Corp. recently offered early retirement deals to cut 6,000 nonmanagement jobs.
Bell Atlantic provides local phone service in New Jersey, Pennsylvania, Delaware, Maryland, Virginia, West Virginia and Washington, D.C.
by CNB