Telecom Italia is to cut 5,000 jobs in its domestic market by 2010 in an effort to yield savings of €300 million a year once the job reduction is complete. The restructuring is expected to cost another €250 million in charges to be taken this year. The news comes only a day after chief executive Franco Bernabe said the operator aims to reduce domestic operating expenditure by up to 40 percent within the next seven years.

The group is taking such action in light of previous statements that it is targeting revenue growth of only 1-2 percent a year between 2008-2010. According to Reuters, Telecom Italia has about 83,400 employees. The former Italian monopoly also said it is reorganising its mobile and fixed-line operations into a new Domestic Market Operations Division, headed by Oscar Cicchetti. The new division will adopt a customer-centric approach, replacing the current split according to fixed or mobile technology.