Change Agent Orange? Tech to Talk to Trump

High-ranking executives from Amazon, Apple, Cisco, Facebook and Oracle are planning to meet President-elect Donald Trump at Trump Tower in Manhattan this Wednesday, as IT and communications executives start to look at how they can benefit from the proposed policies of the new administration.

Bloomberg reports that Alphabet Inc. 's (aka Google) Larry Page and Eric Schmidt will be attending that meeting, as well as Cisco Systems Inc. (Nasdaq: CSCO) CEO Chuck Robbins. Recode says that Apple Inc. (Nasdaq: AAPL)'s CEO Tim Cook and Facebook COO Sheryl Sandberg will also be in attendance, while SpaceX and Telsa boss Elon Musk may -- or may not -- be there.

On the agenda for the tech summit are topics like immigration, policies on China, repatriating cash held offshore to the US, and corporate tax codes. Some of the largest overseas cash holders in the tech industry happen to include Apple, Microsoft, Alphabet, Cisco and Oracle. Ironically, these are mostly the same companies that threw money at the Hillary Clinton campaign and even Bernie Saunders in the Democratic primary contest, while ignoring Trump.

According to an Oxfam report from April 2016, Apple holds more money overseas -- about $181 billion -- than any other US company. In total, the top 50 US companies hold $1.4 trillion overseas.

A turning tide
Nonetheless, companies in the tech and communications sector are already looking at the positive aspects of a Trump presidency. The incoming administration has, for example, promised to cut the corporate tax rate from 35% to 15%. Many observers also expect to see less regulation, which, especially when combined with the return of offshore money to US corporate coffers, should mean more mergers and acquisitions on the horizon.

"It's hard to imagine that there's not going to be more openness to consolidation," T-Mobile US Inc. CFO Braxton Carter said last week. (See T-Mobile CFO on Trump: Expect More Consolidation & More Competition for more.)

"It will allow us to have better cash flows, better earnings, have the opportunity to invest in our networks, in our people, and those two things make it great for business owners," said AT&T Inc. (NYSE: T) CFO John Stephens at a Barclays conference last week.

Merger mania?
But it's not as if there hasn't already been a boatload of mergers and acquisitions this year. (See Microsoft Closes LinkedIn Acquisition. What's Next?, Consolidated Snaps Up Fairpoint for $1.5B, For Marvell, TCB Might = M&A and CenturyLink Splashes $34B on Level 3 Buy for just a recent sampling from our database.) So what more could a Trump presidency bring?

Well, T-Mobile is widely expected to be back on the M&A menu. AT&T tried for a $39 billion merger with the "uncarrier" in 2011, which was blocked by the US Department of Justice. Sprint and T-Mobile dropped talks over a $32 billion merger in August 2014.(See Rumors of a Sprint/T-Mobile Merger Again.)

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

In fact, SoftBank Corp. , which owns Sprint, is already cozying up to Trump. SoftBank CEO Masayoshi Son met with Trump last week in New York. Soon after that, the Japanese businessman said he would invest $50 billion in the US in a bid to create 50,000 new jobs, although he did not go into much detail on how that would be achieved.

Nonetheless, it seems likely that a Sprint/T-Mobile mega-merger could be one of the first huge comms deals up before the next administration.

T-Mobile's CFO Carter, meanwhile, is expecting to see more entrants into the mobile market in the coming years. In years to come, he stated last week, "we'll sit back and just chuckle at the idea that there would only be four major players [in wireless, in the US]."

A sting in the M&A tail?
Despite broad expectations that a Trump administration will be more friendly to consolidation in the tech industry, it may not always be the case. In October, Trump spoke out against the proposed AT&T and Time Warner merger. "AT&T is buying Time Warner and thus CNN, a deal we will not approve in my administration because it's too much concentration of power in the hands of too few," he's quoted as saying of the potential deal.

So the motto may be: Merging mobile networks is good. Media networks? Not so much.

For more:

— Dan Jones, Mobile Editor, Light Reading

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kq4ym 12/28/2016 | 4:50:42 PM
Re: CNN Interesting how all are predicting the next President's moves, but ironically his pronouncements are usually not quite definitive and very subject to change. Predicting his influence and actual changes will be quite a chore for the pundits for a while or at least until the actions can be analyzed over time to see if there's a real decision making trend there.
DanJones 12/15/2016 | 1:01:07 PM
Re: Elon Musk internet Named to the advisory team: http://thehill.com/policy/technology/310321-trump-names-elon-musk-uber-ceo-to-advisory-team
dishnetwork 12/15/2016 | 12:19:35 PM
Elon Musk internet I hope Elon Musk will be there. His plan to launch 4400 satellites for satellite internet and presumably satellite television sounds amazing. Need more innovators in this world.
brooks7 12/14/2016 | 12:03:40 PM
Re: CNN Repatriation of cash is probably at the top of the agenda.  After that it is probably hiring.


DanJones 12/14/2016 | 11:47:45 AM
Re: CNN They should be chatting around now. I wonder what issues will come up.
mendyk 12/14/2016 | 9:56:04 AM
Re: CNN Ah, yes, blaming the unseen hand is a tried-and-true excuse for when things don't go as we want them to. If not Russia, then China. If not China, then ISIS. And on and on, until we get to the ultimate puppetmaster: Canada.
DanJones 12/13/2016 | 10:50:59 PM
Re: CNN But what about the Russians, Dennis?
mendyk 12/13/2016 | 3:22:30 PM
Re: CNN One positive outcome of our recent shared experience is that we've learned conclusively that analytics systems are not very good at predicting the unpredictable.
DanJones 12/13/2016 | 3:09:36 PM
Re: CNN magical thinking?
mendyk 12/13/2016 | 2:05:13 PM
Re: CNN Do you think we will ever get to a point where we "understand" the underlying logic of what's going on? Or, put another way, when will we figure out that there's little or no apparent logic to what's going on? Put linear thinking aside for now -- it's inoperative.
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