& cplSiteName &

AT&T, Verizon Mulling Managed Services With Ericsson

Sarah Thomas
7/1/2014
50%
50%

Ericsson is in talks with both AT&T and Verizon Wireless about managing their wireless infrastructure, according to an executive who shared details with the Bloomberg news agency.

Jean-Claude Geha, head of Ericsson AB (Nasdaq: ERIC)'s managed services business, tells Bloomberg the vendor is in discussions with AT&T Inc. (NYSE: T) and Verizon Wireless about managed services, but he wasn't clear what aspects of the network they were interested in turning over to the vendor.

He did, however, note that there is "growing interest in outsourcing more traditional day-to-day operations and the running of network infrastructure."

Semantics aside, Current Analysis analyst Ed Gubbins says he wouldn't expect the vendor to take over all of the day-to-day network management operations. Rather, Gubbins notes that Ericsson has done a lot of work for major operators in managing network transformations, including data center transformations.

"And the larger trends toward SDN and NFV include transformations that provide a lot of opportunity for vendors' managed services businesses," the analyst adds in an email to Light Reading. Ericsson has also been touting its small cell managed services, but Gubbins says AT&T likely isn't interested in help there. (See Ericsson Launches Small Cell as a Service.)

Ericsson does already provide complete network management for Sprint Corp. (NYSE: S) in the US and manages T-Mobile US Inc. 's OSS/BSS, but winning the big two in any capacity would be a major blow to competitors Nokia Corp. (NYSE: NOK), Alcatel-Lucent (NYSE: ALU), and Huawei Technologies Co. Ltd. (See Ericsson, Sprint Enter Agreement and T-Mobile Swaps Out Amdocs BSS for Ericsson .)

Huawei, especially, has been making a big push into managed services, increasing its revenue 21% in 2013, more than Ericsson did, Gubbins notes, which could be why Geha is letting these "talks" slip. A win in North America, where its Chinese competitor doesn't have a strong presence, is a positive competitive development. (See Ericsson Reports Q1 and Huawei's Operating Profit Soars.)

All of the big equipment vendors have shifted their priorities away from hardware to software and services as their operator customers shift their focus as well. Ericsson, in particular, has made a name for itself in 4G know-how and SPIT-related managed services capabilities, which likely sparked the interest of AT&T and Verizon as they're thinking about evolving their LTE networks and crafting new policy-driven services.

Of course, what will be interesting to watch now is whether Ericsson's competitors will come forward citing their talks with the big two as well. Heavy Reading analyst Sarah Wallace, author of the recent report A New Era of BSS/OSS Managed Services, points out that Amdocs Ltd. (NYSE: DOX) has roots in AT&T and the rest of the market is vying to help Verizon replace many of its homegrown systems, so it's plausible they are all holding discussions. (See AT&T Adds Amdocs, Juniper to Cloud Roster.)

For its part, Ericsson is forecasting an increase in managed services revenue this year, as Geha says it sees increased interest in outsourcing across the globe. Today it announced new managed services business in Romania with branches of the Greek national operator OTE S.A. , which is 40% owned by Deutsche Telekom AG (NYSE: DT). (See Ericsson Wins Managed Services Deal in Romania and Ericsson Wins Managed Services, Kit Deal in Myanmar.)

Ericsson's stock was up slightly, by 0.5% to $12.14, in Tuesday morning trading.

— Sarah Reedy, Senior Editor, Light Reading

(9)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Pete_S4
50%
50%
Pete_S4,
User Rank: Light Beer
7/2/2014 | 9:47:20 AM
Not going to happen.
I watched how well Ericsson taking over Sprint's network worked for years in a support role for one of their larger vendors at the time.  The team was demoralized and it showed in the way the network was run and proably still is.  I saw situations where Eningeers working for Ericsson couldn't be bothered to buy required expansion equipment from Ericsson itself.  I assure you at least someone at Verizon or AT&T is keenly aware of this.  
Ray@LR
50%
50%
Ray@LR,
User Rank: Blogger
7/2/2014 | 4:17:57 AM
Re: Ericsson statement
It wasn't implied - it was specifically stated.

I can't help thinking Geha had either a rush of blood to the head or a scheme he thought was cunning, but which has backfired rather dramatically....
Ariella
50%
50%
Ariella,
User Rank: Light Sabre
7/1/2014 | 5:32:34 PM
Re: Ericsson statement
I'm sure those two are very happy to hear their rival called out today. From http://www.ftc.gov/news-events/press-releases/2014/07/ftc-alleges-t-mobile-crammed-bogus-charges-customers-phone-bills:

In a complaint filed today, the Federal Trade Commission is charging mobile phone service provider T-Mobile USA, Inc., with making hundreds of millions of dollars by placing charges on mobile phone bills for purported "premium" SMS subscriptions that, in many cases, were bogus charges that were never authorized by its customers.

The FTC alleges that T-Mobile received anywhere from 35 to 40 percent of the total amount charged to consumers for subscriptions for content such as flirting tips, horoscope information or celebrity gossip that typically cost $9.99 per month. According to the FTC's complaint, T-Mobile in some cases continued to bill its customers for these services offered by scammers years after becoming aware of signs that the charges were fraudulent.
mendyk
50%
50%
mendyk,
User Rank: Light Sabre
7/1/2014 | 3:41:25 PM
Re: Ericsson statement
I wonder if any accredited university offers a PhD in public relations. It would be really easy to put together a world-class faculty.
mendyk
50%
50%
mendyk,
User Rank: Light Sabre
7/1/2014 | 1:05:05 PM
Re: Ericsson v. Huawei
Margins in this business have been a challenge. Ericsson seems to be the one supplier that has figured out how to make money here. Interesting if U.S. operators are considering Huawei for managed services, given the paranoia over using their equipment.
From The Founder
Cisco's Conrad Clemson, recently promoted to head up the company's Service Provider Apps & Platforms developments, talks to Light Reading's Founder and CEO Steve Saunders about how he's bringing cloud video, mobile and virtualization together to empower network operators.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
LRTV Interviews
Masergy: Ability to Adapt Key for NFV

1|16|17   |   6:40   |   (0) comments


Speaking at Light Reading's 2020 Vision in Rome, Masergy's VP, Global Technology, Ray Watson, said agility is key to providing the mix and match NFV-based services that are driving business for the managed service provider today.
LRTV Interviews
Equinix: The Data Explosion

1|13|17   |   4:16   |   (0) comments


At Light Reading's 2020 Vision in Rome, Eric Schwartz, president of EMEA, Equinix, talked about how Equinix is helping its customers manage the influx of data today, and how it's preparing for a future filled with millions of connected IoT devices.
LRTV Interviews
Heavy Reading: The Changing Data Center Landscape

1|12|17   |   6:05   |   (1) comment


At Light Reading's 2020 Vision event in Rome, Heavy Reading's Senior Analyst Roz Roseboro talks about how virtualization is impacting data center evolution and how that evolution is affecting the relationship between service providers, data center operators and public cloud providers.
LRTV Interviews
Boingo: Prepping for Millions of Devices

1|12|17   |   5:07   |   (1) comment


At Light Reading's 2020 Vision in Rome, Boingo's CTO Derek Peterson discusses how wireless operators will address the needs of low-bandwidth and high-bandwidth apps at the same time, the need for more MHz, the impact of IoT and more.
LRTV Interviews
Comcast Shows Off Gig Gateway at CES

1|11|17   |     |   (1) comment


With its largest presence at CES in years, Comcast took the wraps off its long-awaited gigabit gateway and a new platform for managing the home WiFi network. Light Reading Senior Editor Mari Silbey sat down with EVP Chris Satchell to discuss the latest Comcast advance, and met with VP of Product Strategy and Development Andrea Peiro to walk through a demo of the ...
LRTV Interviews
Colt: End-to-End Key for 2017

1|10|17   |   6:21   |   (0) comments


At Light Reading's 2020 Vision Executive Summit in Rome, Nico Fischbach of Colt said having a multi-carrier, end-to-end service proposition is going to be key for 2017 -- and SD-WAN is instrumental in making it happen.
From the Founder
Cisco's Clemson on Mobile Cloud Video

1|9|17   |     |   (1) comment


Cisco's Conrad Clemson, recently promoted to head up the company's Service Provider Apps & Platforms developments, talks to Light Reading's Founder and CEO Steve Saunders about how he's bringing cloud video, mobile and virtualization together to empower network operators. "If you think about where we're going… whether it's a mobile application, or a video ...
LRTV Custom TV
VMware Telco NFV Solutions – Preparing for 5G & IOT

1|9|17   |     |   (0) comments


Shekar Ayyar, EVP & Corporate Strategy/General Manager of Telco for VMware, discusses VMware's Telco NFV solutions role and foundation for the Imminent Arrival of 5G & IOT.
LRTV Interviews
Heavy Reading: Big Video Set to Disrupt

1|6|17   |   4:39   |   (0) comments


At Light Reading's 2020 Vision Executive Summit in Rome, Heavy Reading's Adi Kishore talks about the challenges of managing and monetizing bandwidth-intensive video, and how service providers will need to transform their networks to cope with the big video explosion.
LRTV Interviews
Heavy Reading: IoT Set to Disrupt

1|5|17   |   7:07   |   (0) comments


Heavy Reading's Senior Analyst of IoT, Steve Bell, tells Light Reading how the Internet of Things (IoT) will transform service provider markets, business models and mindsets, and how virtualizing the network core and Fog networking is key to meeting the agility and flexibility demands of IoT in the future.
LRTV Custom TV
Ensemble SmartWAN Explained

1|5|17   |     |   (0) comments


Ray Le Maistre and Prayson Pate, CTO of the Ensemble division at ADVA Optical Networking, discuss the details around the recent Ensemble SmartWAN announcement from ADVA and its potential impact on the SD-WAN movement as it goes virtual.
LRTV Interviews
Telstra Shares Digital Dos & Don'ts

1|4|17   |   3:21   |   (0) comments


At Light Reading's 2020 Vision Executive Summit in Rome, Telstra's Managing Director of EMEA Tom Homer shares his insight into what makes a good partner in today's digital world.
Upcoming Live Events
May 15-17, 2017, Austin Convention Center, Austin, TX
All Upcoming Live Events
Infographics
Hot Topics
Ericsson: 5G Heralds 'New' New Economy
Mari Silbey, Senior Editor, Cable/Video, 1/12/2017
5G: Another Next-Generation Disappointment?
Iain Morris, News Editor, 1/10/2017
CES 2017: WIC's Picks & What Made Us Sick
Sarah Thomas, Director, Women in Comms, 1/10/2017
IBM, FDA Look to Blockchain to Secure Health Records
Scott Ferguson, Editor, Enterprise Cloud, 1/12/2017
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Light Reading founder and CEO Steve Saunders chats with Sportlogiq CEO Craig Buntin about sports data analysis.
Eyal Waldman, CEO of Mellanox Technologies, speaks to Steve Saunders, CEO of Light Reading, for an exclusive interview about the 100 GB cable challenge, cybersecurity and much more.
Animals with Phones
Live Digital Audio

Playing it safe can only get you so far. Sometimes the biggest bets have the biggest payouts, and that is true in your career as well. For this radio show, Caroline Chan, general manager of the 5G Infrastructure Division of the Network Platform Group at Intel, will share her own personal story of how she successfully took big bets to build a successful career, as well as offer advice on how you can do the same. We’ll cover everything from how to overcome fear and manage risk, how to be prepared for where technology is going in the future and how to structure your career in a way to ensure you keep progressing. Chan, a seasoned telecom veteran and effective risk taker herself, will also leave plenty of time to answer all your questions live on the air.