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May 18, 2023
Fans of artificial intelligence (AI) – the sort of people who think Boston Dynamics' killer robot dog (see below) is cute and cuddly – are fond of saying it will create new roles just as it eliminates others. Humans will be freed from their Windows enslavement by corporate masters to do more interesting work. Even before ChatGPT arrived, this was all sounding as implausible as stories about tooth fairies and chimney-descending old men laden with gifts do to children past a certain age. This morning's update by BT, then, was the equivalent of the parent fessing up.
The UK telco currently employs about 130,000 people, including precisely 97,148 full-time workers and a bunch of contractors. By the end of the decade, somewhere between 40,000 and 55,000 of these jobs will have disappeared, said Philip Jansen, BT's no-nonsense CEO, in the presentation accompanying BT's full-year results. Not freed from trouble ticketing or dealing with surly customers to do more interesting stuff. Just scrapped.
Not all of this can be blamed on AI. Via its Openreach division, BT is currently spending billions to run fiber up and down the length of the UK, a job that involves digging streets and scaling poles. Today's robots aren't good at that and so BT relies on thousands of people instead. By 2026, when it expects to have reached about 25 million homes (it had "passed" 10.3 million at the end of March), these diggers and pole climbers won't be needed. If fiber survives for as long as the old copper network, the next big round of civil engineering will take place around 2120 and probably be carried out by some Boston Dynamics monstrosity.
Many other jobs will vanish as BT ditches old technologies, including the remnants of the public switched telephone network (or PSTN) and 3G, an energy-guzzling mobile standard. Jansen's latest targets include shutting down some 1,573 business applications that BT currently supports. That would leave it with just 500 of those applications by the end of the decade. He also wants to migrate about 10.1 million "units" off the company's legacy networks, about 95% of the current total.
The self-driving network
If all goes to plan, BT will essentially end up with fewer networks more capable of looking after themselves. There will be no big infrastructure rollouts taking a place (a worrying thought for vendors trying to pitch a 6G upgrade). From the customer perspective, dealing with BT will be more like dealing with Amazon. Web clicks, two-factor authentication and text-messaging robots will have replaced store visits and customer-service calls. Clever software will have identified and dealt with network faults before the roving technician can even start the car.
AI alone will claim about 10,000 jobs, Jansen told the UK's Guardian newspaper, describing generative AI as a "huge leap forward." He did not say where the axe would fall, but customer service looks especially vulnerable to ChatGPT and its ilk. Earlier this year, Microsoft revealed that GitHub Copilot, a generative AI that writes software code rather than high-school essays, could be tweaked for the unique requirements of the telco. Yousef Khalidi, the corporate vice president of Azure for Operators, told Light Reading it could reduce time invested by humans in programming, engineering, reading manuals and going through process code.
The situation might not work out so badly for people, but it could feasibly be much worse. Telcos have already sold off towers used to host basestations. Why not the basestations too? New software-based networks make it easier for two or more operators to share the same underlying hardware while keeping their systems apart. Less equipment would mean even less need for people to maintain it.
Figure 1: BT's share price (pence sterling) (Source: Google Finance)
If Jansen thought sharing his vision of BT as a lean, mean fighting machine would thrill shareholders, he was mistaken. BT's share price had fallen about 5% on the London Stock Exchange by mid-afternoon and it has dropped more than a fifth in the last year. Full-year revenues fell 1%, to £20.7 billion (US$25.7 billion), and pre-tax profits were down 12%, to £1.7 billion ($2.1 billion). Small fiber challengers are snapping at BT's heels. There is no vision of growth, just an insistence on cutting and efficiency as the path to profit.
Jansen is not alone. His talk of up to 55,000 job cuts by the end of the decade came in the same week that Margherita Della Valle, Vodafone's new CEO, said she would slash 11,000 jobs, about 11% of the company total, in the next three years. Vodafone had more than 111,000 workers on its payroll in 2016, but the figure had dropped by around 14,600 when the operator last shared numbers in June 2022, due partly to the sale of assets.
As for BT, it has made a net reduction of more than 9,000 full-time jobs since acquiring UK mobile operator EE in 2016. If British competition authorities allow a merger between Vodafone and Three to go ahead, there are bound to be many more layoffs in the country's telecom sector, and a startling number is now planned at BT. For the UK telco workforce, it has been a gloomy week.
— Iain Morris, International Editor, Light Reading
Read more about:Europe
International Editor, Light Reading
Iain Morris joined Light Reading as News Editor at the start of 2015 -- and we mean, right at the start. His friends and family were still singing Auld Lang Syne as Iain started sourcing New Year's Eve UK mobile network congestion statistics. Prior to boosting Light Reading's UK-based editorial team numbers (he is based in London, south of the river), Iain was a successful freelance writer and editor who had been covering the telecoms sector for the past 15 years. His work has appeared in publications including The Economist (classy!) and The Observer, besides a variety of trade and business journals. He was previously the lead telecoms analyst for the Economist Intelligence Unit, and before that worked as a features editor at Telecommunications magazine. Iain started out in telecoms as an editor at consulting and market-research company Analysys (now Analysys Mason).
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