Nokia Siemens Networks and Clearwire (NASDAQ:CLWR) became the casualties of Sprint's (NYSE:S) 15-year, $9-billion hosting deal it announced with LightSquared last week as NSN will see its massive network deal with LightSquared significantly reduced and Clearwire witnessed its stock fall more than 20 percent after the announcement came down.
A year ago LightSquared, which aims to build a nationwide wholesale terrestrial/satellite LTE network, awarded NSN an eight-year, $7 billion contract to build the core and radio pieces of the network along with operating the network on an out outsourced basis. Now with LightSquared's deal with Sprint, LightSquared will take advantage of Sprint's new network architecture being deployed via its Network Vision network modernization plan, which Ericsson (NASDAQ:ERIC), Alcatel-Lucent (NYSE:ALU) and Samsung are building.
In an interview with FierceWireless, Chief Marketing Officer Frank Boulben said NSN will now only be responsible for the core network piece of LightSquared's build out. The value of the deal will be significantly less, but LightSquared is declining to reveal numbers relating to its new deal with NSN.
In an email comment to Light Reading Mobile, an NSN representative said: "LightSquared has a signed agreement with Nokia Siemens Networks for its independent Core network, which includes design, installation, testing and systems integration. In doing so, Nokia Siemens Networks will play a central role in LightSquared's roll out of 4G-LTE. This is an extension of the two companies' partnership as Nokia Siemens Networks has been actively involved in helping LightSquared build its first markets and enabling base9 station development activity."
Meanwhile, Clearwire, which has a wholesale WiMAX network deal with Sprint, saw its stock plummet on July 28. The operator, which announces its second-quarter results on Wednesday, saw its stock fall 22 percent to close the day at $2.15.
In response to an inquiry from FierceWireless regarding Sprint's deal with LightSquared, Clearwire said that it failed "to see how the agreement announced today solves any of the significant problems facing LightSquared, such as its lack of usable spectrum for a 4G LTE network, its significant technical and regulatory problems, and its need to raise billions of dollars in additional funding to cover its obligations to Sprint. We expect to have additional information as a part of our quarterly earnings announcement."
- see this FierceWireless article
- see this Light Reading Mobile article
- see this All Things D article
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