In light of the implosion of the AT&T/T-Mobile merger, everybody’s kinda standing around scratching their heads and deciding what to do next. According to Reuters, at least one entity involved in the wireless industry may benefit from the fallout: network equipment makers.
After having seen their profits decline in the last year, equipment makers are expected to begin to rebound following a spending blitz from both AT&T and T-Mobile to start out the new year (lord knows that AT&T could stand to start making money again after that giant $3 billion break up fee).
From an article earlier today:
Jeff Kvaal of Barclays Capital said equipment makers close to base station vendors would benefit most because AT&T had halted “spending around September, mostly around mobility.”
Vendors with less direct exposure to AT&T’s wireless spending — such as Amdocs, Ciena, Cisco, F5 and Juniper — will benefit indirectly, he said.
“The largest vendor beneficiaries should be AT&T’s incumbent 4G base station vendors, Ericsson and Alcatel-Lucent. T-Mobile’s 3G suppliers are Alcatel-Lucent and Nokia Siemens Networks,” Kvaal said.
The article goes on to cite the jump in stocks of equipment manufacturing companies, such as Alcatel-Lucent and Ericsson, following the demise of AT&T-Mobile. Add to this the speculation that capital spending is expected to improve over the next year and you’re probably looking toward sunnier days if you build cell phone things.
See? That AT&T-Mobile fail isn’t bad news for everybody.