T-Mobile and Ericsson announced a multi-year, multi-billion-dollar contract for Ericsson to provide both hardware and software for T-Mobile’s nationwide 5G network deployment.
The two companies say the deal is worth $3.5 billion. Under the agreement, Stockholm-based Ericsson will support T-Mobile’s rollout with 5G New Radio (NR) technology compliant with 3GPP standards.
This is part of a broader move by the Bellevue, Wash.-based wireless carrier to lay the groundwork for 5G, the next generation of wireless services. 5G networks promise mobile wireless speeds faster than many home internet connections, better enabling new devices and services such as drones and self-driving cars.
Making its case to regulators, T-Mobile contends that its proposed $26 billion merger with Sprint will better position the combined companies to offer 5G services in competition with larger rivals AT&T and Verizon.
“While the other guys just make promises, we’re putting our money where our mouth is,” said Neville Ray, T-Mobile chief technology officer, in making today’s announcement. “With this new Ericsson agreement we’re laying the groundwork for 5G and with Sprint – and with Sprint we can supercharge the 5G revolution.”
T-Mobile has said it plans to roll out 5G service nationwide by 2020, after initial deployments in select cities this year.
The Ericsson agreement is the company’s second recent multi-billion dollar 5G deal. T-Mobile inked a separate agreement with Nokia in July, also for $3.5 billion. It, too, was for 5G technology, software and services.
On Monday, T-Mobile said it was lighting up low-band spectrum to fill in coverage gaps across the U.S., specifically in rural areas, to prepare for nationwide 5G service by 2020. That announcement was for a new offering of what was described as “600 MHz Extended Range LTE” going live in 1,254 cities in 36 states, as well as Puerto Rico.