In a statement, Telecom said Gen-i staff numbers will be cut from 180 down to 60 as it makes significant changes on its focu, concentrating on large corporate customers with specific trans-Tasman ICT service requirements.
It plans to exit from other customer activities that fall outside of this refined business focus, Telecom said.
Where feasible, Gen-i will transfer some customer activities to Telecom subsidiary, AAPT.
"Gen-i Australia was originally set up about 13 years ago to serve the trans-Tasman needs of existing corporate customers. Over the years, it has broadened its activities within the Australian ICT services market -- but we have never had the scale to compete effectively in these other market segments," Gen-i CEO, Tim Miles, said in a statement.
"We believe the time is right to return to Gen-i Australia's core purpose and renew our focus on trans-Tasman ICT services -- an area where we have a strong track record of success, proven capabilities, an excellent roster of corporate customers, and the necessary scale to compete effectively."
In addition to redundancy costs, it is anticipated there will be other restructuring costs associated with this action.
Telecom group expects to recognise a material one-off charge in the second half of the current financial year, as it implements a strategic shift to a competitive provider of communication, entertainment and IT services delivered over its networks and the Cloud.
Costs associated with Gen-i Australia will be included in this charge, which is excluded from the group's stated guidance for FY13 of adjusted EBITDA in the range $1040 - $1060 million.