ICC News: The comprehensive tariff policies announced by the Trump administration are triggering a chain reaction in the telecommunications industry. According to multiple reports and analyses from Fierce Network and Light Reading, major U.S. carriers may be forced to delay 5G network deployments, while small and medium-sized telecom equipment manufacturers are facing an existential crisis.
Operator Strategies: Delayed Deployment and Increased Subsidies
Jonathan Chaplin, an analyst at New Street Research, pointed out: “Operators face a key choice: either increase capital expenditure to absorb rising costs or maintain their original budgets and slow down deployment. We predict they will choose the latter.”
Roy Chua, head of AvidThink, added that although operators will not immediately adjust their capex budgets, a 10% or more increase in equipment prices will directly erode their purchasing power.
On the smartphone front, Avi Greengart, president of Techsponential, stated: “Phone prices will inevitably rise, but operators will try to ease consumer pressure by extending installment plans, increasing subsidies, and adjusting trade-in values.” However, Chaplin warned that even if operators maintain the current level of subsidies, a $150–$200 increase in handset prices could still lead to shrinking market demand.
Recession Clouds Looming
Roy Chua highlighted the risk of a recession: “With growing risks of both U.S. and global economic downturns and increased market uncertainty, operators may freeze spending in the next 3–6 months to evaluate the impact of the tariffs.” This wait-and-see approach could push the entire industry into an adjustment period.
SMEs Face a Life-or-Death Crisis
For small businesses in the Open RAN (Open Radio Access Network) space, the tariff policy could be devastating. Earl Lum, president of EJL Wireless Research, bluntly stated: “Q2 is tough for everyone, but small players are in worse shape—they simply cannot absorb the added costs.” Take Airspan and Mavenir as examples: the former just completed a bankruptcy restructuring last year, and the latter is facing financial distress.
Joe Madden, chief analyst at Mobile Experts, noted: “Any supplier using Asian components will be affected.” Tim McDonald, partner at Pennant Partners, specifically pointed to Japan’s Fujitsu: “Its 5G radio equipment suddenly faces a 24% cost premium.” While Stefan Pongratz, analyst at Dell’Oro Group, believes the long-term growth trend of Open RAN will not change, Monica Paolini, president of Senza Fili, warned that operators might adopt more conservative investment strategies, putting Open RAN at a disadvantage compared to traditional RAN or emerging AI-RAN.
Unexpected Blow to U.S. Tech Giants
Light Reading reports a paradox: U.S. tech firms are suffering more than their European counterparts. Since the tariff policy was announced on April 2, Dell’s stock has dropped 25%, and HPE’s is down 21%, while Ericsson and Nokia have only fallen by 15%. This is largely because U.S. server manufacturers rely heavily on overseas production—Dell operates factories in Brazil, China, and India, while HPE faces supply chain vulnerabilities due to reliance on single-source components.
John Baker, an advocate for Open RAN, suggested the tariff dispute might push operators to diversify their supply chains, similar to how Dish Network enables supplier switching via open interfaces. However, the reality is grim for U.S.-based RAN vendors like Mavenir. The company relies on Jabil in India to manufacture radio equipment, assembled in Pune and Mexico—now subject to extra tariffs. This casts doubt on its partnership prospects with AT&T.
Risks of Global Supply Chain Restructuring
Analysts warn that such protectionist trade policies may drive markets toward local procurement, ultimately constraining business expansion. While the U.S. maintains a lead in chip design and AI, the EU has hinted at potential countermeasures targeting U.S. digital services, which could hinder cloud giants like AWS and Microsoft from expanding their telecom offerings.
As the tariffs take full effect, the U.S. telecom industry stands at a crossroads. Operators are caught between maintaining service quality and controlling costs, while equipment manufacturers face the challenge of a globally shifting supply chain. The entire industry may be on the brink of profound transformation.
