Big, big news from Sprint today boys and girls… Following unending rumors and speculation that Sprint is likely growing accustomed to at this point, the nation’s number three carrier made a huge announcement today that will finally put an end to the rumors. No, Sprint is not selling its network. No, Sprint is not leasing its network. No, Sprint is not being acquired. The carrier is in fact contracting Ericsson to perform day-to-day operation of its wireless and wireline networks. Key clarifications direct from Sprint:
- Sprint is not selling or leasing our networks. We will continue to own and control them, with responsibility for network strategy, investment decisions, technology and vendor selections. The term “outsourcing” implies that we would be giving up control, and we are not — that would be a misleading characterization.
- We are not laying off people – we’re adding the skills of more people. About 6,000 Sprint employees will become employees of Ericsson, doing primarily the exact same jobs. They’ll be augmented by the skills, tools and knowledge of 30,000 more people at Ericsson.
- Customers will continue to work directly with Sprint employees as their primary contact, because Sprint retains full control of the customer experience, customer technical support and services review.
- Ericsson will perform day-to-day network functions under Sprint’s direction – working at the towers, installing lines, managing the storage and movement of equipment, overseeing daily network traffic, etc.
- The deal delivers efficiencies for Sprint, access to improved network tools and processes, and allows Sprint to focus more attention on other areas of innovation.
The seven-year $5 billion deal, which is not common practice here in the US, is a big one indeed — for both parties. Ericsson will assume responsibility for day-to-day services, provisioning and maintenance for the Sprint-owned CDMA, iDEN and wireline networks, adding to the 80 networks covering 270 million subscribers it already manages. Sprint will maintain ownership of its networks as well as responsibility for network strategy and investment decisions. Big changes for sure; but hardly the apocalypse many had been speculating.