Verizon, Ericsson respond to network management report

Verizon Wireless and Ericsson both issued responses Tuesday to an earlier report that claimed Ericsson was in talks with the two largest U.S. carriers about managing their network infrastructure. The Bloomberg news story quoted an Ericsson executive who said that Ericsson was talking to both Verizon Communications and AT&T, but the executive did not describe the nature of those conversations.
“We did not mean to imply that we were in specific discussions with AT&T and Verizon regarding the management of their wireless networks,” Ericsson VP Kathy Egan-Wummer told RCR Wireless News. “We apologize for any confusion this may have caused.”
Verizon Wireless stated clearly that it is not on the brink of outsourcing the management of its wireless network. “The story is inaccurate,” said Verizon spokesperson Thomas Pica. “We do not outsource our network management.”
The confusion could have arisen from Ericsson’s interest in promoting its managed network services, which now reach more than a billion subscribers worldwide. Ericsson has more than 300 contracts to manage infrastructure on behalf of carriers, including a seven-year, $5 billon contract to manage Sprint’s network that was signed in 2009. The deal was the first of its kind for a major U.S.-based operator, and included the transfer of more than 6,000 employees from Sprint to Ericsson.
However, that deal has been under a cloud as Sprint appears to have struggled through its Network Vision program that was managed by Ericsson and included vendor partners Alcatel-Lucent and Samsung. Ericsson is serving in a management role in Sprint’s more recent Spark initiative, with Alcatel-Lucent, Samsung and Nokia Networks serving as vendor partners in that program.
Bloomberg reported that in an interview, Jean-Claude Geha, head of Ericsson’s managed services business, said the company was in discussions with both domestic telecommunication giants.
“We are in discussions,” said Geha, when asked about network services contracts with AT&T and Verizon, according to Bloomberg.
“Ericsson typically engages in discussions with all our customers regarding all our offerings, including managed services,” explained Egan-Wummer. The company is focusing on services and software as ways to offset the slim margins in its traditional network hardware business. Recently Ericsson brought to market a software platform specifically tailored for network management.
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