Marconi has caused a great shock with its profits warning and plans for 4000 more redundancies from its global workforce. The company explained the sudden downturn in its sales, and a likely huge drop in this year's profits, on the recent auctions of 3rd generation mobile phone licenses. Marconi said this had meant European governments taking 100 billion dollars out of its major customers. As a result the finance directors of big telecommunications firms had turned off the taps of new investment and brought about a high speed downturn. But Marconi said it was confident this was just deferred spending as phone traffic was still rising fast and companies would have to resume investing. And it's predicted that the world telecommunications industry will continue to grow for the next ten years and possibly the next 20.

redundancies - when there are redundancies an organization tells some of its employees that they no longer have a job because there is not enough work or they do not have the money to pay them.

workforce - all the people who work for an organization or business

downturn - a reduction; a fall

auctions - a public sale where goods are sold to the person offering the highest price.

turned off the taps - stopped

deferred spending - spending that will not take place at the moment but will happen in the future

Despite this optimism there's no doubt that a big recession has hit firms making equipment for telecommunications, computers and the internet. The world's biggest mobile phone company Vodaphone has revealed that the growth of new customers slowed sharply in the second quarter of the year. And both the Dutch semiconductor company ASML and the Irish internet software firm Baltimore have also warned of falling sales and losses.

hit - affected

revealed - reported

slowed sharply - became less very quickly; fell very suddenly