Dozens of jobs at ultrafast broadband (UFB) network operator Chorus are being cut as the company further embraces a new operating model, the company has confirmed.
With New Zealand’s ultrafast broadband network build completed a year ago, the company says it has been moving from network builder to operator - and with that comes an impact on roles and people.
Many staff across the business have been taken through consultation, and are discovering their fate this week.
The exact number of jobs lost has yet to be confirmed but the Herald understands it will be in the “tens” rather than “hundreds”. Chorus employs about 850 people.
“We are now in the final stage of our organisational redesign,” said a spokesman.
“This stage includes creating new roles and accountabilities to strengthen capability in certain areas, but it will also see some roles no longer required across the business. The change spans the business; it is not specific to individual teams or business areas.
“Chorus is determined to give anyone impacted by the change all the support they need to apply for one of the new roles. However, we recognise that it is unlikely that everyone affected will find a new role and that, sadly, we will see people leaving the company early next year.”
NZX-listed Chorus reported a $25 million net profit after tax for its 2023 financial year, on the back of Ebitda of $672m and operating revenue of $980m.
It announced its new operating structure - and overhauled its executive team - earlier this year after completing the 11-year UFB fibre build in December 2022.
“With the build programme complete, we announced earlier this year that we would move to a new operating model to execute our strategy better, reflect the new fibre regulatory framework, and respond to a changing market environment,” said the spokesman.
“Our new operating model moves us from network builders to network operators. It introduces new capabilities, tools and ways of working to keep the organisation at pace with leading industry practices and more focused on the end-to-end customer-focused delivery of key initiatives.
“The change is needed to underpin Chorus becoming an all-fibre digital infrastructure company.”
The company’s latest annual report describes the operational change as creating a “nimbler Chorus”.
“As consumers’ needs evolve, Chorus needs to change too. Our previous operating model was focused on cost-effectively delivering large, long-term, stable programmes and won’t be as effective in the future as it has been to date.
“With the fibre rollout completed and the regulatory framework now in place, we’re adopting a new operating structure that will help us streamline the way we respond to our retailer customers and deliver better consumer outcomes. This involves changing our vertically integrated network and product business units to drive greater cross-functional collaboration.”
Three new teams have been created:
- Access - focusing on fibre broadband to homes and businesses and tasked with maximising fibre uptake;
- Infrastructure - charged with leveraging the company’s network and assets to grow new revenues;
- Fibre Frontier - directing the extension of fibre coverage and eventual retirement of the regional copper network.
Chorus chairman Mark Cross said in the company’s annual report that the global boom in fibre rollouts “gives us great confidence that we’ve invested in the right infrastructure for the future”.
“Recent OECD data shows fibre already accounting for 38 per cent of all fixed broadband subscriptions at the end of 2022, surpassing cable on 32 per cent and copper broadband on 24 per cent.
“This shift to fibre, and the emergence of alternative wireless and satellite broadband networks in rural areas, has started the countdown on the usefulness of copper networks.
“Norway and Sweden, for example, are well advanced in the retirement of copper. We expect this to occur here in the next decade and we believe fibre should be extended further to help bridge the digital divide between urban and rural communities. We’re exploring how we could play a part with the right investment incentives.”
A source told the Herald the changes had been unsettling for staff.
Chorus’ annual report, released in August, revealed a happy business - its staff engagement score was 8.7 out of 10 and other measurements put it in the top 5 per cent of the technology sector.
The spokesman said Chorus would be offering “comprehensive counselling and support services for anyone impacted by the changes.
“Outplacement and career transition support will be available for those confirmed redundant and leaving the business. We’re currently finalising the consultation outcomes and communicating with those affected; we can’t yet be specific about the impact on Chorus’ headcount.”
- Editor-at-Large Shayne Currie is one of New Zealand’s most experienced senior journalists and media leaders. He has held executive and senior editorial roles at NZME including Managing Editor, NZ Herald Editor and Herald on Sunday Editor.