T-Mobile signs multi-billion dollar deal with Ericsson for 5G equipment
Buying networking equipment for the next-generation of mobile connectivity is not cheap. Ericsson announced today that it has received its largest order for 5G gear to date, a $3.5 billion purchase from the nation's third largest carrier, T-Mobile. Back in July, T-Mobile announced a $3.5 billion deal with Nokia that will supply the wireless provider with hardware, software and services to help the carrier provide 5G signals over its 600MHz low-frequency spectrum. That deal also provides T-Mobile with the equipment necessary to offer "ultra-high speed" service in urban markets via 28GHz millimeter wave channels.
In late April, T-Mobile announced a $26.5 billion purchase of Sprint. To help gain necessary approval for the deal from the FCC and the Justice Department, both carriers have tried to sell the government on the idea that the country's leadership in 5G technology is at stake. While we won't know whether this plan will be effective until the regulatory agencies vote, some analysts say that the odds of the deal closing have improved.
If the transaction is approved, T-Mobile plans on carrying its mobile 5G signals over its low-frequency 600MHz spectrum, purchased last year at an FCC auction for nearly $8 billion, and Sprint's 2.5GHz high-band airwaves. Both T-Mobile and Sprint say that building out a combined coast-to-coast 5G network will result in the hiring of additional employees during the construction of the network. On the other hand, the Communication Workers of America (CWA) says that a combined T-Mobile-Sprint will let go over 28,000 employees to prevent duplication of jobs. Needless to say, the union opposes the transaction.
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