Blond Buffoon a Worry for Telecom Vendors

China's Huawei is already locked out of opportunities in the US, purportedly because of security concerns, and the door seems unlikely to open now that Donald Trump has pulled off the unthinkable and entered the White House.

The real estate billionaire and blonde buffoon (Ed: is that hair combed forward or backward?) of reality-TV fame has pandered to fears that jobs are being lost to China and other low-cost labor markets, promising to tear up the free trade rulebook on becoming president.

But could Trump's improbable victory have an impact on foreign equipment vendors already active in the US market? Both Ericsson AB (Nasdaq: ERIC) and Nokia Corp. (NYSE: NOK) count US service providers among their biggest customers and use China as a manufacturing base.

Moreover, if Trump is serious about imposing tariffs on foreign imports, his policies could hurt manufacturers the world over and not just in China and Mexico, the countries he has publicly attacked.

Ericsson and Nokia certainly look highly exposed to the US market. Ericsson generated about a quarter of its sales in North America in the recent July-to-September quarter, while Nokia made about 30% of its revenues there.

There is already bad blood between Ericsson and Trump, who was reported to have accused the Swedish vendor of bribing Hillary Clinton back in August. New Ericsson CEO Börje Ekholm, who holds US citizenship and lives in the US, went on record as saying he would not be voting for Trump in the run-up to the election.

On the other hand, both companies have large US workforces. Ericsson, for example, employs more than 12,200 people in North America, according to its latest data, or about 11% of its total workforce. They are also generating a growing share of their revenues from the sale of software products, rather than hardware, as networks become increasingly virtualized and software-based.

That could explain why their share prices did not suffer like some others in the wake of today's news. Ericsson closed down about 1% in Sweden, while Nokia was up by the same amount in Helsinki at the end of the day. Bad news for Huawei Technologies Co. Ltd. -- which might have hoped for a loosening of restrictions under a Hillary Clinton administration -- is also good news for its European rivals.

For all the latest news from the wireless networking and services sector, check out our dedicated Mobile content channel here on Light Reading.

Contrast this with the impact on IT outsourcing specialists from India that cater heavily to US needs. Infosys Technologies Ltd. (Nasdaq: INFY) is trading down about 4% on the New York Stock Exchange, while Tata Consultancy Services Ltd. closed down more than 4% on the National Stock Exchange of India earlier today.

Indeed, while there is a perception that US workers have lost out to Infosys and its ilk, Ericsson and Nokia are unlikely to seem as villainous to the Trump faithful. And a rapidly consolidating equipment market is leaving AT&T Inc. (NYSE: T), Verizon Communications Inc. (NYSE: VZ) and others with a dwindling list of vendor options -- especially as Huawei's name is already missing.

Even so, the complexity of the global supply chain, and Trump's disregard for big business, may prompt a few jitters. Earlier this year, he lashed out at iPhone maker Apple Inc. (Nasdaq: AAPL) for getting components made in China instead of the US. Tariffs on those components would inevitably drive up manufacturing costs and, in all likelihood, the price of iPhones.

That's a worrying prospect for consumers, service providers and network equipment makers, as well -- of course -- as Apple.

But these are pretty worrying times.

— Iain Morris, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, News Editor, Light Reading

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Faridurjaman 4/5/2018 | 6:25:56 AM
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SystemsA33511 4/13/2017 | 12:22:03 AM
Re: Politics where it doesn't belong @KBode!  Wrong!  He didn't run a nasty campaign.  He just put Americans first and he was open about it. I could call your comment about a calling a spade a spade racist, but that would be intellectually dishones becasue the racial over tone of the word spade was introuduced well after the common saying to be blunt, but if I said you were a racist and the rest of the alt left media started saying KBode is a racist over and over then the uneducated  like you portend yourself to be would make statements that KBode in fact was a racist.  

BTW, DJT's policies defend the LGBT communitiy by not allowing potential Islamist into our country. His policies will help the poor people of all colors by redcuing the competition for the low paying jobs.  You KBode should check your political hacktivismn at the door.
JNelson 3/25/2017 | 6:18:20 PM
New to LR not thinking I will be here long...... I am new to LR, I was hoping to learn about the forward path of our industry, unfortunately the first article to catch my eye was a direct insult to the Commander and Chief of the United States of America, it does not matter what side of the political spectrum you are registered as if you cannot respect the Office of the Leader of the Free World then you have no business writing in a business publication, I hope that you are done with LR, I hope you have gone away to degrade other politicians who are in the pockets of their special interest donors, one thing I can say about our current President is that yes he is RICH, he is NOT taking a paycheck (which while in office our previous President gave himself quite the hefty raise to do the same job and took lavish vacations, put his children in elementary, middle and high schools that cost the tax payers more than most college students pay per year, and paid for his mother in law to live a life style only Millionaires such as the Trumps have the opportunity to do on the tax payers dime!!!), this President is donating his pay to charity, he cannot be bought by special interest, nor can many of his appointees as most of them are financially set, this will mean that we can believe that there will be less corruption in our Administrative arm of Government in Washington DC, when he says he is going to drain the swamp he means he is going to do just that, he will do what is best for the American citizens who pay our taxes which BTW are meant to support our Government and our citizens when they fall on hard times, not to support illegal immigrants who make it through our borders due to the actions of the previous Administrations edict to catch and release, there are too many Angel family members that were caused by this edict, Kate Steinely murdered by an illegal immigrant who made it back into the Country six times before shooting and Killing Kate in the Sanctuary city of San Francisco, most recently a Mother of 4 was murdered by an illegal immigrant who was caught and released 5 times, another 14 year old girl was just raped by a pair of illegal immigrants who some idiots not only caught and released but thought instead that it would be a good idea to let them enroll into a high school here in Maryland as Freshmen with 13 and 14 year old children - the one who claims to be 18 is probably more like 25 but unfortunately he has no identification to prove either his identity or his age so we have to take him at his word.

America is a soveriegn Nation, we now have a President who cannot be bought, this is a great thing for America, he is going to lower taxes not only for the people but for businesses to allow more growth in our country, he is going to put Americans back to work, he is going to make trade FAIR between Nations, we pay to export products but Countries get a free pass when importing to our Nation how is that fair to our businesses or to Americans.......I do not know where you are from and cannot say that I really give a crap, but what I can say is the Light Reading has a lot to offer but small minded bloggers like you do not belong on this website, I hope you are banned for life from this site or they will lose many professionals who actually care about American businesses and American workers who are being put out of work and jobs due to unfair business practices in other countries who pay their people pennies to do the work that American people make a decent wage to do!

All Communications companies have businesses all around the world even those that are based in America, the laws instituted will impact all of them equally so I do not see the point of the article other than to insult our President the day after he was duly Inaugurated into office, he is one man who will uphold the Oath of the Office of President of the United States, not line his pockets such as the Clinton fanily did with money intended to help the poor people in Haiti after the devistation they endured with monies donated to the Clinton Foundation some of which was used to pay for Princess Chelsea's elaborate wedding!! We did end up with the best choice that was being offered to lead our Nation for the next four/eight years, if Clinton had gotten into office we would already be living under Sharia Law in many of our counties and State offices, since it is clear Hillary has been bought and paid for by the Middle Eastern countries that donated close to $100 Million dollars to her campaign much less the Billions that have been donated to the Clinton Foundation!
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KBode 11/16/2016 | 11:16:24 AM
Re: Politics where it doesn't belong "You're being disingenuous, Dennis. People come to LR for the news and analysis. Not to see insulting names being attached to anyone."

I don't mind it when the shoe fits and the situation warrants. And this case, when it comes to somebody that ran a campaign pandering to the nastiest, most racist base instincts of the nation resulting in a massive amount of fear among the minority, press, and LGBT communities, bufoon fits like a glove.

Press outlets need to call a spade a spade, or we'll be justifying and rationalizing insanity, bigotry, and bizarre policy decisions in short order. 
kq4ym 11/16/2016 | 11:08:28 AM
Re: President Elect Trump It will be an interesting few weeks ahead of the US inauguration ceremonies in Janauary, trying to guess and forecast what the future may bring to foreign investors, suppliers and the resulting possible chaos as international concerns sprout. But then that's not to overlook the real anxiety for the next years, trying to guess what's going to happen or not happen.
Iluzun 11/15/2016 | 12:35:26 PM
Re: Politics where it doesn't belong 'Class' vs 'Ass''. Why does it profoundly feel that we as a country have chosen to be 'initiated' by a Trickster figure? Mercurius X 4. Yes, the man has been economically successful. Yes, he is intellectually over stressed. A narcissistic child, man, bully who thrives on conflict and adoration. The genie is out of the bottle and we live in the shadow of the 'Age of Disinformation'. Our soon to be 'great leader', Patton? MacAurther? TR? Think 'Hail Caesar' writ large. Time to dust off the Whos, 'Don't Get Fooled Again'...
jbtombes 11/15/2016 | 10:06:49 AM
Re: President Elect Trump The 'e' on the end of blond in the title, in any case, looks like an unforced error. In other matters, since 11/8 ERIC is holding steady, NOK and TATA are down about 6-8%. INFY down twice as much.
gocowboys 11/13/2016 | 4:17:29 PM
Re: President Elect Trump A buffoon - "a gross and usually ill-educated or stupid person". I don't see how that relates to hair nor do I see this as good natured chiding. It is a derogatory remark and it has no place in a professional publication.
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