US operator Sprint has announced the partners for its widely-anticipated network evolution programme, with Alcatel-Lucent, Ericsson and Samsung all picking up parts of the deal. The tender process has already been surrounded by controversy, primarily related to the fact that it reportedly included submissions from Chinese equipment vendors Huawei and ZTE, sparking concern that these vendors could install equipment that would enable US communications to be intercepted. Both companies have gone to great lengths to prove their credentials to the US decision makers, although it now seems that this was to no avail. In a statement, Dan Hesse, CEO of Sprint (pictured), said that its selected partners “realised the network proposal process was highly competitive, and each responded with innovative, cost-effective solutions.”

The company is intending to deploy multimode base stations to replace the separate infrastructure used to provide services on its 800MHz (iDEN) and 1900MHz (CDMA EV-DO) spectrum, as well as the 2.5GHz spectrum (WiMAX technology) used in partnership with Clearwire. This will include the closure of its iDEN network, which will free-up 800MHz spectrum that will be “repurposed” for CDMA services. In order to retain the push-to-talk (PTT) customer base which is a staple of the iDEN business, Sprint “expects to launch the next-generation of PTT services in 2011 on the CDMA network.” The iDEN phase-out will take place from 2013.

In a conference call, Steve Elfman, president of Network Operations and Wholesale at Sprint, confirmed that initially the company’s focus is on its 800MHz and 1900MHz activities, with no plans explicitly stated for how this will fit with its future network evolution. Elfman indicated that while the potential is there to use the infrastructure to support LTE, the company’s stated evolution path is WiMAX, although again no explicit plans were detailed. “What we are buying is CDMA at 800 and 1900, inherent in both of these frequency bands comes LTE at the radio head. So if we choose to deploy LTE, we can do so, to get a lower cost per megabit. So that’s what we buy initially. In terms of Clearwire, that is our 4G strategy, WiMAX with Clearwire, and this provides a good opportunity for the two companies to network share, again if we so choose,” he said.

The total incremental cost of the programme during the deployment period will be between US$4 billion and US$5 billion, and it estimates the total net financial benefit for a seven-year period to be between US$10 billion and US$15 billion. Cost savings are expected to come from capital efficiencies, reducing energy costs, lowering roaming expenses, backhaul savings and the eventual reduction in total cell sites. Sprint also highlighted the environmental benefits of its infrastructure refresh, stating that as work progresses the size and power of its base stations will be reduced.

A significant amount of the cost savings (35–45 percent) comes from the closure of the iDEN network, although this will not be a straight switch-off — the company will assess if the iDEN sites are better located than existing CDMA towers, in order to create the optimal network deployment. Sprint does have some 800MHz frequencies that can be used for CDMA as soon as the network is built, however, co-existing alongside its iDEN properties. “We’ve actually lost a few iDEN customers over the years, and we do have some spectrum available to use almost immediately at Network Vision implementation,” Elfman said.

So far, Sprint has been non-committal in the timings for the work, stating that pilots taking place during 2011 will define the “speed and course” of its implementation. Timings for the iDEN closure will depend on when “all things are successful in terms of the coverage and the way PTT operates.” While the company is promising significant cost savings moving forward, during the initial stage of the deployment (to around 2013) it will be spending heavily to support the build-out. It has not stated the level of operating expenditure savings it expects once the new infrastructure is in-place, although further guidance is likely to follow next year.

Contracts have been split based on geography: Alcatel-Lucent will service markets including New York City, Philadelphia, Boston, Washington, D.C./Baltimore and Los Angeles; Ericsson’s remit includes Atlanta, Miami, Houston, Kansas City and Dallas; while Samsung’s deployments will include Chicago, Denver, Pittsburgh, San Francisco and Seattle. Ericsson also says it will act as the “prime integrator, with responsibility for assuring the successful introduction and transition of all vendors’ equipment into Sprint’s nationwide network infrastructure.” Ericsson is Sprint’s existing managed services supplier, having won a lucrative US$5 billion deal in 2009.