& 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
Kicking off BCE 2017, Light Reading founder Steve Saunders lays blame for NFV's slow ramp-up and urges telecom to return to old-fashioned standards building and interoperability.
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.
Women in Comms Introduction Videos
Infinera's Sales Director Paints Tech's Big Picture

6|21|17   |   4:14   |   (2) comments


Shannon Williams, Infinera's director of sales, shares how she achieves work's many balancing acts -- between her role and the broader company, today and tomorrow's tech and more.
LRTV Custom TV
SD-WAN Innovation & Trends

6|20|17   |     |   (0) comments


Versa CEO Kelly Ahuja discusses with Carol Wilson the current status and trends in the SD-WAN market, Versa's innovation around building a software platform with broad contextualization, and the advantages that startups can bring to the SD-WAN market.
LRTV Interviews
Ovum's Dario Talmesio on 5G in Europe

6|20|17   |   02:16   |   (0) comments


At 5G World 2017, Dario Talmesio, principal analyst and practice leader on Ovum's fixed and mobile telecoms European team, explains the emerging trends amongst European operators as they prepare for 5G.
LRTV Custom TV
Putting Power on a Pedestal

6|19|17   |     |   (0) comments


ARRIS's John Ulm says a major accomplishment of SCTE•ISBE's Energy 2020 program is increased focus on power cost and consumption, including inclusion of energy requirements in operators' RFPs and RFIs.
LRTV Custom TV
Gigabit Access: The Last-Mile Pipe for All Future Services

6|19|17   |     |   (0) comments


A Gigabit access platform being deployed today must be able to deliver all types of services to an increasing number of devices. A non-blocking architecture is necessary to support the ever-increasing growth in bandwidth demand. The Huawei Gigabit access solution is based on a distributed design that is fully scalable to deliver a unprecedented performance.
LRTV Custom TV
Key Factors to Successfully Deploy an SD-WAN Service

6|19|17   |     |   (0) comments


As service providers transition their SD-WAN solution from trials and limited deployments into production at large scale, there are important considerations to successfully operationalize these solutions and realize their full potential, without adding complexity, introducing uncertainty or disrupting current business operations. Sunil Khandekar, CEO and Founder ...
LRTV Custom TV
IoT Solutions: Rational Exuberance

6|19|17   |     |   (0) comments


IoT solutions are morphing from hype into viable business opportunities. Huawei has the platform and ecosystem support to help carriers successfully address new business opportunities in the IoT space.
LRTV Custom TV
Realizing ICN as a Network Slice for Mobile Data Distribution

6|19|17   |     |   (1) comment


Network slicing in 5G allows the potential introduction of new network architectures such as Information-centric Networks (ICN) as a slice, managed over a shared pool of compute, storage and bandwidth resource. Services over an ICN slice can benefit from many architectural features such as Name Based Networking, Security, Multicasting, Multi-homing, Mobility, ...
LRTV Interviews
Ovum's Mike Roberts on 5G Uptake

6|19|17   |   04:08   |   (0) comments


Mike Roberts, research director for Ovum's service provider markets group, explains why he has boosted his 5G subscriptions forecast.
LRTV Interviews
AT&T's Hubbard on Intersection of SD-WAN & MPLS

6|15|17   |     |   (0) comments


Rick Hubbard, SVP of Network Product Management for AT&T Business Solutions, discusses how AT&T's approach to SD-WAN fits in with its overall virtualization strategy, explains how SD-WAN can improve enterprise customers' use of the cloud and addresses the intersection of SD-WAN and MPLS.
Telecom Innovators Video Showcase
Keep Connected IoT Devices Under Control With Allot

6|15|17   |     |   (0) comments


Allot AVP of International Pre-Sales, Daniel Keidar, explains how communications service providers can protect infrastructure and service availability from flooding attacks caused by malfunctioning or bot-infected devices connected to their network.
LRTV Custom TV
ZTE 5G World Highlights

6|15|17   |     |   (0) comments


ZTE showcases its leading 5G innovations at 5G World in London.
Upcoming Live Events
October 18, 2017, Colorado Convention Center - Denver, CO
November 1, 2017, The Montcalm Marble Arch
November 1, 2017, The Montcalm Marble Arch
November 30, 2017, The Westin Times Square
All Upcoming Live Events
Infographics
With the mobile ecosystem becoming increasingly vulnerable to security threats, AdaptiveMobile has laid out some of the key considerations for the wireless community.
Hot Topics
Netflix's Lesson in Culture Expectation Settings
Sarah Thomas, Director, Women in Comms, 6/21/2017
Kalanick Steps Down as Uber CEO
Sarah Thomas, Director, Women in Comms, 6/21/2017
BT Tech Chief Makes Plea to 5G Chip Vendors
Ray Le Maistre, International Group Editor, 6/20/2017
No Imagination: UK Chip Biz Goes Up for Sale
Iain Morris, News Editor, 6/22/2017
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Following a recent board meeting, the New IP Agency (NIA) has a new strategy to help accelerate the adoption of NFV capabilities, explains the Agency's Founder and Secretary, Steve Saunders.
One of the nice bits of my job (other than the teeny tiny salary, obviously) is that I get to pick and choose who I interview for this slot on the Light Reading home ...
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.