Virgin Media suspends staff over £3bn upgrade errors

Virgin Media has suspended four employees and launched an internal investigation after reducing the number of homes it said had been reached by a £3bn network upgrade.

The cable company said on Tuesday that staff had “misrepresented” the completion status of the Project Lightning expansion when it reported fourth-quarter results in February.

Virgin Media claimed that its new network had grown to pass 215,000 British homes in the three months to the end of December but has now cut that figure to 86,000.

Four employees have been suspended as a result of the revision. Paul Buttery, chief operating officer in charge of driving customers to upgrade to the network, left the company in late February.

It is the latest issue to hit British telecoms companies with BT grappling with a complex fraud in Italy, allegations of bid rigging in its Hong Kong operation and a record fine from regulator Ofcom over the use of a loophole to reduce its payments to rivals when it was slow in delivering high-speed cables.

The revision has reduced the number of premises covered by Project Lightning to 567,000 from the 715,000 outlined in February.

The issue related to inactive cabinets that Virgin Media included in its original numbers. It was led to believe that it would be able to power up the cabinets quickly to start connecting customers.

However, the company has since found that it is not able to do so which has forced the revision. It now expects that all the 142,000 inactive cabinets will be connected by the end of the summer, enabling it to pass between 700,000 and 800,000 UK homes by the end of the year, roughly in line with its previous expectations.

Virgin Media’s owner, Liberty Global, said in a regulatory filing: “Our review found that the completion status of a number of inactive premises had been misrepresented. In connection with this review, four Virgin Media employees have been suspended and removed from their posts and employment investigations are ongoing.

“Pending the results of these investigations, disciplinary action may be taken against employees, including dismissal.”

The changes to its numbers will not hit financial guidance. 

Virgin Media has reacted by strengthening its management team to deliver the project. It has recruited Jeff Dodds, head of mobile at rival TalkTalk, to run its mobile arm and Dana Strong, Liberty Global’s transformation officer, is to join as chief operating officer. Both executives previously worked at Virgin Media.

Rob Evans has also been promoted to run Project Lightning from his role as head of networks and will report to both Tom Mockridge, chief executive of Virgin Media, and Liberty Global’s chief technology officer Balan Nair.