1,300 jobs go as email phones flop

BT is slashing jobs in its pay phone division after failing to lure people off their mobiles and into booths linked to the internet.

About 1,300 jobs are expected to go from BT retail, which is responsible for pay phones. A BT spokesman said about 40% of pay phones do not cover their costs.

'There has been a decline of more than 50% in pay phone usage and a 40% cut in revenue,' he said.

Last November, BT said some phone boxes would be removed, but it also announced ambitious plans to install internet terminals in others.

Despite being described as successful by BT, the email phone boxes have failed to replace lost revenue. Insiders said usage had been poor.

One said: 'Our customers have a choice between standing in phone boxes, which often smell like a toilet, or relaxing in an internet cafe with a latte. Which do you think they are going to choose? There is no way we are winning.'

BT's scheme to shed the jobs has been dubbed Project Scorpio, according to an insider.

He said: 'The pay phone business is being restructured again and more jobs are going. Various teams are being merged and some people being squeezed out.'

A source at Connect, the union for senior BT staff, said negotiations were being held on how the restructuring should happen.

A Connect spokeswoman said: 'BT is being very constructive and is standing by its long-term guarantee of no compulsory redundancies.'