NEC, Ericsson cut staff numbers

NEC is set to move part of its research and development operations back to Japan after losing a bid to supply National Broadband Network kit. Meanwhile, Ericsson is also considering layoffs after the end of its managed services contract with VHA.

Will Clarke, media relations manager for NEC, told ZDNet Australia that "it's a sad day for us as an organisation, and it's one we've tried to avoid but the market has changed and as an organisation we need to make sure that we are fit to continue on". The jobs of 67 workers were up in the air, he said.

NEC, Ericsson and Alcatel-Lucent are considering redundancies (Odd Job Names image by Alan Levine, CC2.0)

Clarke confirmed that there would be redundancies in the company's Melbourne research and development facility. "NEC is committed to helping its employees find other jobs within other divisions of the company ... we're now looking at how we undertake research and development for DSL products," he said.

NEC maintains other research and development divisions around the country, focusing on 4G LTE and developing Android products like e-readers and an Android powered tablet.

NEC said the cuts were due to the lost bid to supply optical and Ethernet aggregation equipment to NBN Co. However, Alcatel-Lucent, which won the bid, still slashed staff, citing "uncertainty in the Australian telecommunications market in recent years".

Meanwhile, as VHA comes to the end of a managed services contract with Ericsson, 120 staff are also staring down the barrel of redundancy. Ericsson confirmed that number in a statement and said that it would look to relocate as many staff as possible.

VHA awarded the new service contract to Nokia Siemens Networks after Ericsson was dropped from the vendor panel in April. Ericsson has held the deal since 2002.

The VHA/Ericsson contract has moved into a transition stage, and is due for completion in October 2010.