Sprint outsources U.S. phone operations to Ericsson
Last Updated: Thursday, July 9, 2009 | 4:34 PM ET
CBC News
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U.S. phone company Sprint Nextel Corp. has outsourced the day-to-day operation of its wireless and wireline services in a deal valued at up to $5 billion US.
Ericsson Services Inc., a U.S.-based subsidiary of the Ericsson phone technology and services giant, will take on about 6,000 Sprint employees in the third quarter, the companies said in a joint news release Thursday.
Sprint will pay Ericsson between $4.5 billion and $5 billion over the seven-year deal.
The deal will help Sprint become more efficient and allow it to focus on technology and customer service.
Ericsson welcomed the chance to get its brand of managed services into the U.S. market.
"This shows that the trend of full-scope managed services with tier-one global operators is now happening in the U.S.," said Angel Ruiz, head of Ericsson's North American operations.
Sprint said no jobs will leave the U.S. as a result of the deal, and no layoffs "are currently contemplated" as a result of the agreement.
Ericsson will take on provisioning and maintenance for Sprint's CDMA, iDEN and wireline networks.
The deal has been rumoured for months, U.S. media reports said.
Sprint stock rose 17 cents to $4.46 on the New York Stock Exchange. Ericsson shares fell two cents to $9.34 on Nasdaq.
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