Ericsson grabs $8.3B 5G deal from Verizon

Verizon said it awarded a massive $8.3 billion deal to 5G equipment vendor Ericsson.

The agreement is critical to both companies considering Verizon is keen to build a 5G network with its new C-band spectrum licenses, while Ericsson is hoping to maintain its momentum in the global 5G marketplace with marquee operator contracts.

"We're looking forward to working with Verizon to leverage solutions like Cloud RAN and our Street Macro, adding depth and versatility to 5G network rollouts across the US," said Niklas Heuveldop, president and head of Ericsson North America, in a release. "We are pleased to continue this work through our long-standing relationship with Ericsson," agreed Kyle Malady, Verizon's CTO, in the release.

Verizon spent around $50 billion on midband C-band spectrum licenses earlier this year, and subsequently confirmed plans to spend $10 billion over the next three years on equipment to put that spectrum to use. Verizon ultimately hopes to cover up to 250 million Americans by 2024 with speedy 5G services as a result of all that spending.

In the companies' brief announcement, Verizon said it would buy Ericsson's 5G MIMO C-band, lowband and millimeter wave (mmWave) solutions. "Ericsson's technology solutions, including Massive MIMO, Ericsson Spectrum Sharing, and Ericsson Cloud RAN, complement the high-performing Ericsson Radio System portfolio to support 5G services," Ericsson added in its release.

Ericsson, for its part, has been working to counter Nokia's continued efforts to capture market share among 5G network operators worldwide. At the same time, Ericsson has been working to expand its business globally by grabbing business away from China's Huawei amid widespread worries that the Chinese vendor's equipment can be used for espionage.

Verizon, in particular, has fostered a significant amount of drama among the world's 5G infrastructure vendors. Rumors surfaced last year that Verizon was preparing to replace Nokia with Samsung as one of its primary wireless network equipment suppliers. Just a few months later, Verizon announced a $6.6 billion deal with Samsung for 5G.

Verizon told Light Reading in April that it would use equipment from Ericsson and Samsung as part of its C-band network upgrade project for 5G. The company also told Light Reading that it would begin deploying open RAN equipment this year, but it did not provide details.