Summary
One of the most important things a carrier needs to do is manage its own network. In the past the mere thought of having an outsider do this work would have been considered heresy.
Analysis
Why in the world would Sprint commit the ultimate crime in network operations: Letting someone else take care of your network? The answer is simple. Sprint needs to get its operational cash expenditures under control and the best way to do that would be outsource its network management to an outside party.
As old school as I am about managing your own network. The reality is that Dan Hesse is doing the smart thing. Network operations is a huge cash eater for any telecom carrier. Sprint needs to grow its cash reserves. I am a little uneasy at the thought of an outsider running Sprint’s network but then again the actual staff running the network will not exactly be outsiders; they are all going to be former Sprint employees. Ericsson has been in the game for over a century and should by now know how to run a network. Ericsson is
I think the move by Sprint fits into what appears to me the company’s strategic move into content provisioning and management. Telecom is changing; it is no longer about minutes of use for voice or data, it is rapidly becoming about charging for the value of telecom services and media services. Sprint needs to move away from the distraction of the day-to-day management of the network.
Carriers like Verizon manage their own network but then again Verizon is in a different place at this time and frankly did not have to contend with the likes of trying to integrate the old Nextel network. I am amazed that Sprint was able to spend so much time and cash on managing two disparate networks - Sprint and Nextel. The retention of Ericsson will eliminate a management headache for Sprint.
Dan Hesse's decision is correct and I whole heartedly agree with it.
