Rising costs, declining margins and an uncertain business environment have compelled telecom operators Bharti Airtel, Reliance Communication and Tata Teleservices, to rejig their organisational structures.

While this move will have a positive impact on individual company margins going forward, it has injected the fear of lay-offs in the minds of their employees.

Sources said Bharti Airtel has laid off several hundred employees as a result of a recent organisational rehaul aimed at its India and South Asia operations. The company has recently combined various segments – including mobile and digital TV - into two separate business units to improve efficiency.

A spokesperson for Bharti Airtel said: “In the new organisation structure many roles have been augmented, some realigned.

We expect any attrition will remain at our annual attrition average of 11-12 per cent.” However, the spokesperson did not offer specific lay-off related comments.

Anil Ambani-controlled Reliance Communications has merged its three business divisions, a move which could render 700 RCom employees jobless, news reports suggest .

An RCom spokesperson conceded that the company has embarked on a reorganisation of its wireless business, which when completed will “improve RCom’s wireless business’ ‘Teeth to Tail’ ratio (ratio of front-end staff to back-end staff) from 60:40 to 75:25 – one of the best in the telecom industry.”

“RCom’s wireless re-organisation is an outcome of a planned business milestone with an objective of re-calibrating our people and processes and will result in enhancing our market competitiveness on segmented voice and data offerings across 2G, 3G and CDMA platforms…

In addition, the new organisation will lead to a significant margin accrual from effective asset sweating in field, rightsizing opex apportioning for optimising capex yields and overall functional cost optimisation,” the spokesperson added.

Industry insiders feel that RCom’s latest move could help the company grow its EBITDA by 2-3 per cent. At present, RCom has a debt of around Rs 32,000 crore on its books.

Tata Teleservices too, has embarked on a move to unify its CDMA and GSM businesses with an eye on cutting costs.

This could result in reassigning job functions internally and some attrition. However, a Tata Tele spokesperson did not respond to a Business Line query.

Even though tariffs have stabilised recently, cost cutting is very much on the cards because the stabilisation happened at much lower levels than what industry players

would have expected, according to Mr Kunal Bajaj, Director India of research firm Analysis Mason. “Any industry which grows quickly does have to look at its cost base especially when the period of hyper growth wears off,” he added.

It may be recalled that all three operators have invested heavily in securing licences for 3G airwaves, a technology which has had slow uptake.

While Bharti Airtel paid the highest - Rs 12295.46 crore for 3G spectrum in 13 circles, RCom (13 circles) and Tata Tele (nine circles) invested Rs 8585.04 and Rs 5864.29 crore, respectively.

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