Sprint in 'final negotiations' on Ericsson outsourcing

The Wall Street Journal is reporting that Sprint is in "final negotiations" to outsource the management of its cellular network to Ericsson and will transfer 5,000 to 7,000 U.S. employees to the equipment vendor. The deal, which is valued at $2 billion, will mean that Ericsson will manage and maintain the thousands of cell sites that carry Sprint's wireless voice and data traffic.

The agreement, which has been rumored to be in the works for quite some time, is expected to slash Sprint's network costs by 20 percent. Sprint's board is reportedly reviewing the deal. If finalized, it will help Sprint aggressively reduce its spending to make up for its widespread customer losses. Today Sprint reported a net loss of 1.25 million postpaid subscribers [1].

The article did not detail whether the deal includes Sprint's iDEN network, which is separate from its CDMA network. Ericsson and Sprint declined to comment for the WSJ article.

In March a Swedish newspaper reported that the Sprint/Ericsson network outsourcing deal was complete [2], but neither Ericsson nor Sprint would confirm that report. According to the WSJ article, the complex deal could still fall apart.

For more:
- see this article [3] (sub. req.)

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