How NSN plans to take over US networks

Because of the potential for finger-pointing in such scenarios, outsourcing arrangements require rock-solid governance models. With those in place, he said, “It’s not as complicated as you might think.”

Employees transferring from a regional telco to a joint venture of two global conglomerates will see “comparable” benefits at the new company, Paris said. And their career options will broaden considerably -- to other technologies and geographies. “If someone wants to take a role in India, they can apply,” he said.

As NSN gradually effects change in carriers’ network operations, it’s unclear to what extent the company’s manufacturing arm could benefit. Since NSN does not own the network, it does not make equipment purchasing decisions. But it is free to, and in some ways tasked with, making recommendations in that area. That would seem to give NSN an opportunity to push its own gear over that of competitors, and it’s unknown what price advantages might flow through an outsource partnership. But because the business of that partnership is based on trust, NSN can’t be perceived as serving the interests of its own equipment sales over the interests of its carrier clients.

“We’ll look at things in their network and say, ‘Gee, we could save money on our side if you make these changes here that will help you save money there,” Paris said. “If we have something super-duper [in NSN’s product portfolio] and can improve the efficiency and operations of that network, we’ll make a recommendation [for NSN gear]. I think if everything’s equal, the carrier will say, ‘I’ll go with my outsourcing partner’s products.’ But the product’s still going to have to stand on its own. I don’t see a carrier making decisions because, ‘Hey, I can get a better deal.’ I don’t know whether they will or not.”

Ultimately, for NSN’s business with Embarq to be successful, the vendor has to win other customers, yeilding economies of scale by, for example, consolidating Embarq’s network operations centers with those of new customers and applying Embarq’s former employees to those new tasks.

“That’s the heart of our business case,” Paris said. “All this activity with Embarq is remote support. The surveillance monitoring, performance monitoring and optimization of their network is all done remotely. In the back office, technical support people. The next customer comes on, sure, you have to add more people, but you need less.”

So how soon will NSN start adding customers, and employees, to its new North American base?