BellSouth Takes $1.2-Billion Charge for Upgrades, Cuts

ATLANTA — BellSouth Corp. said it will take a $1.2-billion restructuring charge in the fourth quarter to upgrade its network and will cut 2,200 more jobs by 1996.

BellSouth said that almost half the charge, about $550 million, reflects the company’s plans to upgrade its network, while $310 million covers the costs of consolidating and eliminating certain operations.

The remaining $380 million of the charge reflects the elimination of jobs. BellSouth said it will increase the number of jobs it will cut by 2,200 to 10,200 by the end of 1996.

The charge, which comes amid increased competition in the telecommunications industry, will decrease fourth-quarter net income by about $760 million, or $1.53 a share.

BellSouth and the six other regional Bell operating companies are feeling the heat from competitors that build fiber-optic networks and have lured away some of the Bells’ lucrative business customers.

In addition, cellular companies have eaten away at the local phone market. In the future, cable companies hope to go head-to-head with the Bells for both cable and phone services.

“We’re changing the way we do business. We’re speeding up our service efforts, investing in new systems and just making it easier for our customers to deal with us,” said John L. Clendenin, chairman and chief executive. “And we’re doing it for one reason: to provide better service at more competitive prices for our customers.”

BellSouth also said the recent mergers among cable, phone, cellular and media companies have forced it to become more competitive.