London CNN  — 

BT Group is planning to slash up to 55,000 jobs in the next five to seven years as it makes greater use of technology, including artificial intelligence, to cut costs and simplify its business.

The UK telecom company said Thursday that its total workforce would fall to between 75,000 and 90,000 by 2028-2030, from 130,000 at present. That includes BT employees and contractors supplied by a third party.

“By continuing to build and connect like fury, digitize the way we work and simplify our structure, by the end of the 2020s BT Group will rely on a much smaller workforce and a significantly reduced cost base,” CEO Philip Jansen said in a statement.

On a call with analysts, Jansen added that 10,000 roles would be replaced by digitization and automation.

“We will be a beneficiary of AI unequivocally,” he said, noting that the technology would help the company deliver customer service “in a more seamless way.”

“Our chatbot Amy deals with lots of customer queries already,” he added. BT was beginning to explore new products and services that might come from “generative AI and large language model AIs.”

Jansen also said that around 10,000 fewer people would be needed to service and repair digital networks, which “go wrong less often” and can be fixed more easily than older networks.

Earlier this week, Vodafone (VOD), once the world’s biggest mobile telecom group, said it would cut 11,000 jobs, or about 11% of its workforce, over three years. The company also unveiled a turnaround plan to revive its ailing fortunes under new CEO Margherita Della Valle.

Traditional telecom companies have suffered in the face of competition from the likes of Apple (AAPL) and Google (GOOGL), which offer “the same staple services of voice, messaging, and video calls,” according to McKinsey.

European telecom companies have fared particularly poorly over the past decade, delivering lower returns to shareholders than their US peers, the consultancy said in a recent report.

BT has already cut £2.1 billion ($2.6 billion) in costs since April 2020.

While “drastic,” BT’s planned job cuts were not “overly surprising given the mounting costs and slim margins in the wider business,” Matt Britzman, an equity analyst at broker Hargreaves Lansdown, said in a note.

Once BT’s broadband and 5G networks were built out, “the strategy shifts to monetizing the infrastructure that’s in place and leveraging new technologies to do that,” he added.

BT said revenue fell 1% to £20.7 billion ($25.8 billion) for the year to March, with growth in Openreach, its fibre broadband network, “more than offset” by declines in other businesses. Its adjusted earnings rose 5% to £7.9 billion ($9.8 billion).

Shares in the company tumbled 8% in London, as higher expenditure leading to a drop in free cash flow disappointed investors.