Ericsson to manage Clearwire's 4G network

Clearwire outsources the management of its nationwide WiMax network as it looks for additional ways to cut costs.

Marguerite Reardon Former senior reporter
Marguerite Reardon started as a CNET News reporter in 2004, covering cellphone services, broadband, citywide Wi-Fi, the Net neutrality debate and the consolidation of the phone companies.
Marguerite Reardon

Clearwire has signed a deal with wireless equipment supplier Ericsson to manage its 4G WiMax network in an effort to save on operating costs.

Today, the company announced the new seven-year deal, which entails Ericsson managing Clearwire's day-to-day network operations. As part of the deal, about 700 Clearwire employees will become Ericsson employees in the middle of 2011. Ericsson will be responsible for all the network engineering, operations, and maintenance of the network. But Clearwire will retain control of strategy decisions for the future of the network.

Ericsson, which sells the equipment used to power wireless networks around the world, has been managing several of its customers' networks. In fact, Sprint Nextel made a similar deal with Ericsson in 2009.

Financial details of the deal between Clearwire and Ericsson were not disclosed, but Clearwire said in its press release that it expects to realize "immediate cost savings on labor, network management and operations."

Clearwire had 3,300 people at the end of the first quarter of 2011, which ended March 31. Last year it announced deep job cuts as it tried to slash spending costs.