Ericsson Inks 7-Year 3G Network Contract with 3 Italy

Ericsson has announced an exclusive contract with Hutchison 3G Italy (3 Italia) that includes a seven-year agreement to modernize and upgrade the existing WCDMA/HSPA network with Ericsson technologies and architectures. It also includes an extension of the current managed services deal.

It has a reduced financial value compared to the previous contract, as a result of the returning of some third party contracts and the implementation of the new service delivery model. Also, the optimized network is more efficient and requires less service activities. Ericsson warned that transition and transformation costs will put pressure on margins initially but over the total contract period the profitability is "satisfactory".

Under the terms of the contract, Ericsson will modernize and upgrade the existing 3G mobile broadband access and core networks, optical and radio transport, data charging, and consumer-services platforms and systems. The deal also extends the exclusive managed services contract signed in 2005 for the total management of 3 Italia's multi-vendor 3G network and telecom IS&IT infrastructure. The prolonged contract runs for five years.

This agreement comes after a successful long-term collaboration between Ericsson and 3 Italia, which started in 2001, with 3 Italia choosing Ericsson as the main partner for its 3G core and access technology and later, in 2005, as exclusive partner for managed services of its multi-vendor network and telecom IS/IT infrastructure.

According to figures from the Mobile World analysts, 3 Italia ended Q1 '09 with just under 8.9 million customers, which represents a market share of around 6.5%.

On the web: 3 Italia - Mobile World

Posted to the site on 5th June 2009