PCCW reviews London NOW operations

Hong Kong-based Pacific Century Cyberworks is to launch a root-and-branch review of its West London broadband business Network of the World in the wake of its recent decision to axe 340 jobs and cut spending on internet services.

While the current job cuts are limited to Hong Kong, PCCW will be seeking to cut costs and improve revenues at Network of the World’s Chiswick office, which employs 400 people, a spokesman for the company said.

The office, which is run through a deal with TWI, the programming arm of Mark McCormack’s IMG, produces NOW’s English-language editorial and video content, which is also carried across NOW websites in Asia in parallel with local language content.

The review is expected to take three to four weeks.

PCCW’s spokesman said: 'They are redefining what they are doing in London … They are having to reconsider the services, applications and content in line with market conditions. There is a need to cut costs and improve the business model. PCCW is in talks with TWI about production costs and revenue streams and they’re looking at re-shaping the business.'

In part, Network of the World’s problems are linked to the slow take-up of broadband, the spokesman said: 'The take-up of broadband has lagged behind expectations… I don’t think PCC was wrong in thinking that the future was broadband – it’s just taken longer to come than expected.'

Network of the World was conceived as a global, internet-based TV service that would be the flagship of the PCCW group, which became one of Asia’s major telecoms providers with the takeover last year of Hong Kong Telecom from Cable & Wireless.

However, PCCW shares have crashed from the heights achieved during the dotcom boom and chairman and chief executive Richard Li suffered embarrassment over the revelation that, despite claims to the contrary by some of his companies, he had not completed a Stanford University engineering degree.