Mobile phone group mmO2 announced today that it will cut 1,400 jobs in its BT Cellnet UK business this year.

The group, which demerged from BT in November, said the cuts would affect back office, technical and administrative staff.

It is also closing 133 of its existing 320 BT Cellnet high street stores.

The company said restructuring, likely to centre on offices in Leeds and Slough, would improve its financial performance.

It said the move also reflected the changing nature of the mobile phone market.

Operators are moving away from concentrating solely on driving up subscriber numbers to building revenues from their existing customer base.

The cuts will begin in April.

The group has axed 250 staff in the BT Cellnet business in the current financial year, which ends next month.

Chief executive Peter Erskine said: "The mobile phone sector is changing."

mmO2 said it would also cut 500 more jobs in its German subsidiary, VIAG Interkom, in the coming financial year.

The combined cuts will leave a workforce of 6,100 in BT Cellnet, and an estimated 8,900 across the rest of its European operations.