GCI laying off 87 employees in reduction of force

In a confidential memo obtained by the Alaska Landmine, sent today to GCI employees, GCI announced they are laying off 87 employees. The memo is from Greg Chapados, GCI President and CEO. It begins with:

I have some serious news to share with you. This morning, GCI is letting go 87 employees in a reduction in force. Ron and I deeply appreciate the many contributions these employees made to GCI’s past success, and we regret that the reduction has become necessary. Each affected employee will receive severance pay as part of his or her exit plan.

The full memo can be seen here:

GCI Layoff Memo-April 4, 2019

The memo goes on to list the following reasons for the layoffs:

  • In October 2018, the FCC staff unilaterally reduced the USF revenue we receive from our rural health care (RHC) customers by $28 million. The entire reduction hit our EBITDA line.
  • 2018 overall was an extremely tough year for GCI. Even setting aside the RHC reduction, our EBITDA was $15 million below budget. In other words, our business as a whole performed poorly.
  • Over several decades, we built GCI to serve a growing Alaska economy. Unfortunately, over the past three-and-a-half years, we haven’t seen economic growth. There are some signs of hope this year, but we are a long ways yet from a robust recovery.
  • Like every other company in the communications industry, GCI must deal with the competitive pressures that accompany massive technological and business model change. To survive and prosper, we must evolve to become more effective and efficient.

GCI was acquired by Liberty Interactive last year. The sale was completed in May 2018. This article goes into more detail about the acquisition.

The memo concludes with:

One last but very important thing: Ron and I know that this reduction will be challenging both to those who are leaving and those who must take up the slack. Each of us as GCI employees need to support one another as we adjust to this major change.

Maybe they could start by taking a look at the salaries of their executives and the operational costs of their high end, luxurious fly-in lodge, Agulowak.


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4 years ago

That sucks. Why did they sell out? No more promoting your local anymore. I hope everyone I know still has their job and that the people who lost their job find better employment quickly.

4 years ago

Much better story than the fluff piece in ADN! Nice work.