Sprint Finalizes Plan to Cut Network Costs by up to $1 Billion

by Istvan Fekete on January 21, 2016

cell-towerSources familiar with the matter have told Re/code that Sprint is planning a “radical overhaul of its cellular network,” a move that could save the country’s fourth-biggest carrier as much as $1 billion.

Sprint aims to relocate its towers from space leased from Crown Castle and American Tower to government-owned land where the rent is much lower. The relocation plan is apparently set to materialize as early as June.

In earlier statements, representatives of the carrier have already talked about cutting $2 billion in overheads, as Sprint aims to end six straight years of losses. Tower leases are a major component of those overheads, some of which are the costs of buying and maintaining the cellular gear itself, while another is the cost of renting the space on which the gear sits.

Sprint also seeks to trim backhaul costs by reducing reliance on AT&T- and Verizon-owned fibre-optic cables. That would mean roughly $1 billion in annual savings. Instead, the carrier will reportedly use microwave technology to link its cell towers to telecom networks.

Fact is, microwave technology isn’t widely used in the US. However, Ericsson predicts it will become the dominant backhaul by 2020, handling 65% of cell sites. As the network gear manufacturer points out, microwaves improve network capacity and will also ease the pressure on Sprint’s finances.

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Written by: Istvan Fekete. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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