While business and residential customers are pleased with lower voice and data service costs with competition, job cuts are "the other side of the coin," Kagan added. "Real people lose real jobs to keep the companies cost-competitive."

BellSouth maintains 20 million access lines in service, and it has nearly 7 million long-distance customers and more than 2 million DSL subscribers. The company generated approximately US$28 billion in revenue in 2004.

Most of the workers affected by the cuts are expected to accept voluntary severance packages before April 30, BellSouth officials said.