Deutsche Telekom’s T-Systems computer services unit is cutting more than a quarter of its positions to reduce costs after draining money for years.
The unit will cut as many as 10 000 jobs, of which 6 000 will be in Germany, over the next three years, Harald Lindlar, a spokesman for the unit, said on Thursday. The division employs about 37 000 people.
The eliminations are meant to save €600-million by 2021 so the unit’s CEO, Adel Al-Saleh, can reinvest some of the money into “growth areas”, Lindlar said by phone. Deutsche Telekom has in the past identified cybersecurity, its cloud business and Internet of things-related services as new opportunities.
While T-Systems gives Deutsche Telekom access to large multinational clients it can sell other services to, the unit has for years been the company’s problem child. Some of its contracts have proven loss-making, and it has come under pressure as IT services are increasingly moving into the clouds of Amazon.com and Alphabet’s Google, where they’re available at a lower cost.
Germany’s Handelsblatt newspaper reported the job cuts earlier on Thursday. — Reported by Stefan Nicola, (c) 2018 Bloomberg LP
