Future Spokane Cable Operator Lays Off 2,500 Tci, Which Replaces Cox Cable, Restructures Work Force, Including 23 Local Job Cuts

Tele-Communications Inc., the Colorado cable giant that’s poised to take over the Spokane system, said it’s eliminating 2,500 jobs and freezing or cutting executive salaries to reduce debt and improve its financial performance.

The Thursday announcement, which represents a 6.5 percent reduction in TCI’s 38,500-person nationwide work force, comes a week after the company said it was laying off 23 employees in Spokane as part of its plan to assume control of the Cox Communications Inc. franchise.

Following the layoff, the Spokane system will employ 156 people who serve 90,000 cable subscribers, said Hank Sexton, TCI’s Washington state manager. No further cuts are anticipated, he said.

Cox and TCI agreed last year to exchange Spokane and several other cable systems as a way to consolidate their nationwide holdings. The swap is expected to close before the end of the year, pending approval from the Spokane City Council and county commission.

TCI spokeswoman LaRae Marsik said the company-wide job cuts were expected to save $100 million a year.

TCI announced the layoffs one day after the company’s board decided to spin off Liberty Media Corp., its programming arm, and the company’s international unit, Tele- Communications International Inc., which operates in 17 countries.

TCI has been under scrutiny for its sagging stock price. TCI’s shares have dropped about 28 percent this year, and chairman John Malone has promised to cut costs to reduce its $14.5 billion in debt.

“It appears Malone is turning over every stone in an attempt to generate cash and cash savings with an eye toward boosting his stock,” said Spencer Grimes, a cable analyst at the brokerage firm Smith Barney.

Wall Street seemed to like Malone’s style. TCI shares Thursday closed up 50 cents at $13 5/8.

Last month, TCI reported a third-quarter loss of $136 million, citing investments in its cable systems and new technology, compared with a profit of $32 million a year earlier. The company reported revenue of $2.1 billion for the quarter, compared with $1.7 billion a year ago.

The spin-offs announced Wednesday were seen as a way to simplify TCI’s capital structure and make the company easier for Wall Street to understand. A spin-off of TCI Satellite Entertainment Inc., with 650,000 subscribers, was completed Wednesday.

Jim Jungjohann, an analyst at the A.G. Edwards & Sons brokerage, said he expects TCI will accomplish its goals with the moves announced Thursday and more cuts are unlikely. He discounted speculation that the company is cleaning itself up in preparation for a sale.

But Tom Kerver, business editor for Cablevision Magazine in Denver, predicted that TCI was being slimmed down in preparation for a future takeover perhaps by AT&T Corp. or Sprint Corp.

, DataTimes