Broadwing to Cut 900 Jobs

All-optical switched network provider Broadwing Inc. is implementing a reorganization plan that company officials said would “realign the company’s focus and resources against the current economic and market opportunities.” In the process, the company is axing about 900 jobs, representing approximately 15% of its workforce.

The company’s cuts will also bring a $250 million to $300 million charge to the company’s bottom line in the fourth quarter. The moves will also position the company to become free cash flow positive by mid-year 2002,” officials also said.

Broadwing is consolidating customers from its 11 Web-hosting centers into three core facilities in Cincinnati, Austin, and Newark, Del. The capabilities of the company’s all-optical switched network enable storage and managed services solutions that are independent of geography, officials said.

Also, the DSL and Internet activities of Broadwing’s ZoomTown are being merged into the company’s Cincinnati Bell operations. This move better leverages the ZoomTown DSL product into Cincinnati Bell’s suite of successful bundled offerings, Broadwing said.

Additionally, certain staff functions and call center operations are being combined to increase effectiveness and realize operating efficiencies. Also, some customer service and information-technology operations are being outsourced for efficiency, while others will be streamlined to correspond with the company’s focus on higher end data and Internet customers, the company said.

Broadwing also said it is closing six enterprise sales branch offices, and is concentrating “resources and
energy” in its top 30 markets. Also closing is Broadwing’s construction line of business, which primarily built networks for other carriers. With the fiber optic network complete and operating in the top 137 MSAs in the country, the company’s network operations will streamline to focus on maintaining and adding customers to the network.

The company will also eliminate some layers of management, and will reposition its Broadwing Technology Solutions IT consulting and systems integration to focus on market opportunities that “maximize Broadwing’s core network capabilities.”

“These changes will move our company closer to our customers, speed our decision-making, streamline our operations by removing layers of management, and better align our costs against a changing telecom landscape,” said Rick Ellenberger, Broadwing’s president and chief executive officer (CEO), in a statement.

Through the reorganization, the company will add “profitable customers” to its network, Ellenberger also said.

As part of the reorganization, current Broadwing Executive Vice President and Chief Financial Officer (CFO) Kevin Mooney will take on the newly created position of chief operating officer (COO), where he’ll be responsible for all operations including, sales, network operations, information technology, and customer service. Mooney will hold these duties across both Cincinnati Bell and Broadwing Communications.

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