Sequester Could Sock Verizon & AT&T

Verizon Communications Inc. could be the telecoms company with the most to lose if mandated U.S. government budget cuts continue through September. The telecom giant had $1.9 billion in government contracts in 2012, ranking it No. 18 among federal suppliers that year, according to Washington Technology. Of course, that $1.9 billion is relatively small in percentage terms. Verizon made total revenues of $115.8 billion in 2012. Verizon Wireless alone, which is jointly owned by Verizon and Vodafone, has contracts with the U.S. Army, Air Force, Navy and Postal Service. AT&T Inc. is the second largest telecoms supplier -- ranked 36th -- with a similar contract list. It had $720.8 million in contracts last year. The U.S. government's across-the-board budget cuts (the Sequester) started in March and will have to total $85 billion by September unless another budget deal is struck. It is not clear exactly how that will effect the telecoms and wireless sector. The first shockwaves have been noted by mobile security firms, and it seems likely that IT providers such as Cisco Systems Inc. could feel the pinch, too. Cisco isn't remotely the IT company with the most exposure to government spending. That distinction goes to Hewlett Packard, with $4 billion in contracts in 2012. That ranks HP seventh, after a number of military-focused contractors. For more

• Cisco Could Be Hit by Weaker US Govt Spending.
• Mobile Security Market Wobbles

— Dan Jones, Site Editor, Light Reading Mobile