Sprint to Ericsson: Take My Network Operations…Please
Sprint has found a novel way to improve its network operations: Turn them over to Ericsson. On Thursday, the wireless carrier announced a long-rumored plan to outsource its network to Ericsson. The seven-year, $5 billion deal will see Ericsson servicing, provisioning and maintaining Sprint’s CDMA, iDEN, and wireline networks. Under its terms, Ericsson (ERIC) will take on 6,000 Sprint (S) employees as part of the arrangement. Sprint will retain ownership of its cell towers and control over its network strategy and investment decisions.
For Sprint, which is suffering from declining revenue and a thinning subscriber base, the move is a quick-and-dirty way of cutting costs and freeing up resources to focus on innovation and remedying the real and perceived issues with its services.
“This is about improving our customer experience,” Steve Elfman, head of Sprint’s network operations, said during a conference call this morning. “While we get the benefit of Ericsson’s expertise…we can focus our attention on bringing great devices, great services, great applications to them….We’ll benefit from the current scale and efficiency and expertise of Ericsson, and this will keep improving over time.”