UPDATE 3-BT names retail head Livingston as CEO

(Rewrites with more analyst comments, background, shares)

By Mark Potter and Kate Holton

LONDON, April 8 (Reuters) - Ben Verwaayen, the man who helped to transform BT Group into an IT and broadband-focused communications powerhouse, is leaving the former state phone monopoly to be succeeded by high-flying insider Ian Livingston.

Analysts said Livingston, the 43-year-old head of BT's retail business, was a strong successor, but that Verwaayen's departure came a little earlier than expected and could spark a few jitters ahead of BT's annual results on May 15.

Some also thought the promotion of the cost-cutting Livingston could herald fresh job losses at Britain's biggest fixed-line telecoms provider.

"We think that Livingston...can get BT focused much more on costs," Merrill Lynch analysts wrote in a research note, estimating that BT's core UK fixed-line business could run with closer to 50,000 employees compared to the current 80,000.

BT said on Tuesday that Livingston was the board's unanimous choice to succeed Verwaayen and there would be no big change in strategy.

"He was in the kitchen for the last six years," Verwaayen told CNBC television. "It's safe to assume that the strategy we're in is the strategy we'll be on with him."

Livingston joined BT as finance director in 2002 and became head of its retail business in 2005. He previously worked for retailer Dixons and was the youngest director on the FTSE-100 when appointed finance director there at the age of just 32.