While Sprint Corp. had little to say about a possible deal with Nextel Communications Inc., the carrier did report $3 billion worth of multi-year buildout contracts with Lucent Technologies Inc., Nortel Networks Ltd. and Motorola Inc., last week in support of the carrier’s EV-DO deployment. Sprint said the contracts involve new switching and radio hardware and software for cell sites, capacity augmentation and the carrier’s EV-DO network deployment with options for future technology upgrade options.
Sprint added that it expects approximately $1 billion of the $3 billion investment will include upgrades to EV-DO technology with plans to launch services in yet-to-be-named major markets next year. The remaining $2 billion will be targeted for network capacity and coverage enhancements.
As part of the infrastructure deals, Lucent received a three-year contract to enhance Sprint’s current network and deploy EV-DO technology as well as upgrade the carrier’s existing Lucent-supplied base stations with an additional RF carrier where needed and provide elements of Lucent’s IP Multimedia Subsystem solution. Lucent said the deal was expected to exceed $1.5 billion over three years.
Nortel received a three-year contract to deploy radio base stations, controllers and switching platforms, its Packet Data Service Node 1600 and EV-DO equipment where required. Nortel said the contract would be worth approximately $1 billion over the three years.
Motorola received an extension to its current CDMA supply agreement with Sprint that runs through the end of 2006 involving 1x base station equipment and related services as well as providing its EV-DO solution in markets served by its 1x infrastructure. Motorola said the contract extension is worth $450 million.
Sprint’s infrastructure plans follow similar announcements from rival Verizon Wireless, which has already launched EV-DO services in a number of markets with plans to expand deployments to more than two-thirds of its network next year, and Cingular Wireless L.L.C., which announced UMTS/HSDPA contracts last week with Lucent, Siemens Communications Inc. and Ericsson Inc. as well as handset deals with Nokia Corp., LG Electronics Co. Ltd. and Motorola.
Analysts noted that while the announcement did not provide any additional light as to the timing of Sprint’s EV-DO launch, it is significant in showing that the carrier is moving aggressively ahead with its high-speed data plans.
“It was important for Sprint to announce the deals because it shows they are not just sitting by and allowing Verizon and Cingular to run away with the data market, which has been and continues to be Sprint’s trump card,” said Michael Grossi, principal at consulting firm Adventis Corp.
