Sprint Could Outsource Network to Ericsson

Sprint Nextel is in final negotiations to outsource management of its cellular network to Ericsson in a cost-cutting move, a report says.
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Sprint Nextel

(S) - Get Report

is in final negotiations to outsource management of its cellular network to

Ericsson

(ERIC) - Get Report

and transfer 5,000 to 7,000 U.S. employees to the equipment vendor, the

Wall Street Journal

reports, citing people familiar with the matter.

The deal is seen as a cost-cutting move that would help offset Sprint's dwindling subscriber numbers, the

Journal

notes.

The two companies haven't finalized a contract and discussions could continue for a few more weeks, the newspaper reports. Sprint could end up paying Ericsson as much as $2 billion over several years to maintain the cell sites that carry Sprint's wireless voice and data traffic. The deal is expected to slash Sprint's network costs by about 20%, these people say.

Ericsson and Sprint declined to comment for the

Journal

.

The people close to the matter cautioned it is still possible that Sprint may choose not to move forward with the outsourcing strategy at all, according to the

Journal

.