Streamlining for the Holidays at Windstream

Windstream is sending out some cards just in time for the holiday season, but they aren’t of the festive variety. The hybrid ILEC/CLEC is planning to slim down its workforce by 2.7% by December 1 in an effort to improve its cost structure and efficiency.

Windstream plans to cut 350 jobs out of its current headcount of about 13,000. Some of that derives from continued integration of its PAETEC acquisition, although that was three years ago now. Some 120 of those reductions won’t be layoffs per se, but rather voluntary buyouts. Annual savings are expected to be about $20M, with a $7.5M severance-related charge expected to hit Q4 earnings.

The company is also planning to spin off its network assets into a publicly traded network REIT this year. Like the move it also hopes will improve the prospects of the whole as they continue to try to find the right footing for a business that has both incumbent and competitive assets, both enterprise and residential customer bases, and no wireless exposure but some nice data center and cloud stuff. It’s a combination that is quite unique at the scale Windstream has, and it shouldn’t be surprising when they tweak their approach. Still, layoffs for the holidays are never fun, especially for the affected.

On another note, Windstream is also upgrading its Ethernet capabilities at the edge with some help from Overture Networks.  They’ve picked Overture’s multi-service Ethernet delivery platform to upgrade their backhaul and access networks across fiber, E-Access, copper, SONET, and TDM. I got a chance to meet with Overture at GEN14 as well, and they seem very well positioned right now given all the work going on out at the network edge these days.

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Categories: CLEC · ILECs, PTTs · Jobs · Telecom Equipment