While Clearwire will retain ownership of the physical network and decide on suppliers and strategy, Ericsson will be responsible for all engineering, operations and maintenance for the entire network (core, transport and radio access).
The 700 Clearwire network management staff affected by the deal will transfer to Ericsson before the second half of the year. The value of the deal was not revealed.
"This managed services partnership is the next logical step for both Clearwire and Ericsson, one that will have significant near-term and long-term benefits for Clearwire's employees, customers, retail distributors and investors," stated Berge Ayvazian, senior consultant at Heavy Reading .
This is Ericsson's second major wireless network managed services deal in the U.S. -- in June 2009 the vendor struck a seven-year managed services deal with Clearwire's largest shareholder, Sprint Corp. (NYSE: S) valued at up to US$5 billion. (See Sprint Gives Clearwire $1B Boost and Ericsson Bags $5B Deal.)
Clearwire's share price is up $0.09, more than 2 percent, to $4.36 in early trading Wednesday.
Why this matters
Clearwire needs to cut costs and focus on its services and customer growth strategy, things that this deal should help it achieve.
It also makes a network sharing deal between Clearwire and Sprint a clean and easy prospect. Sprint CEO Dan Hesse confirmed Tuesday that the two are talking about just such a deal. (See Sprint CEO: More LTE Info Coming This Summer.)
For Ericsson, the deal strengthens its services hand in the U.S. and confirms its status as the world's leading supplier of managed services, one of the few areas of growth left for the major vendors.
Here's the latest on Clearwire:
- Intel to Cut Its Stake in Clearwire
- Clearwire Says It Won't Sell Spectrum
- Clearwire Posts Q1 Loss
- Clearwire Finally Unveils Best Buy Service Plan
- CTIA 2011: Clearwire Updates on LTE
- Clearwire CEO & Senior Execs Resign