Potential fallout of wireless acquisitions

The ripple effect of industry consolidation

Industry analysis by expert Joanie Wexler, plus links to the day's wireless news headlines

Verizon buys Alltel; Belden buys Trapeze. The consolidation game in the wireless industry - WAN and LAN alike - is officially afoot.

There are both glass-half-full and glass-half-empty perspectives to such shifts. For example, when it comes to networking, where all things are increasingly interrelated, sometimes having one throat to choke is appealing from a management perspective. On the other hand, there are fewer suppliers and, thus, fewer options.

It might be appropriate to view the recently announced Trapeze acquisition by cabling and connectivity company Belden for $133 million as a positive one-stop-shop move. But some might consider it a step toward vendor lock-in. And it’s not yet clear how the acquisition will affect Trapeze’s recently renewed OEM arrangement with Nortel and Belden’s with single-channel WLAN startup Extricom. Remember when Airespace was acquired by Cisco? It was a nightmarish move for Nortel and other Airespace OEMs and their customers to find alternative solutions.

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Verizon buys Alltel; Belden buys Trapeze. The consolidation game in the wireless industry - WAN and LAN alike - is officially afoot.

There are both glass-half-full and glass-half-empty perspectives to such shifts. For example, when it comes to networking, where all things are increasingly interrelated, sometimes having one throat to choke is appealing from a management perspective. On the other hand, there are fewer suppliers and, thus, fewer options.

It might be appropriate to view the recently announced Trapeze acquisition by cabling and connectivity company Belden for $133 million as a positive one-stop-shop move. But some might consider it a step toward vendor lock-in. And it’s not yet clear how the acquisition will affect Trapeze’s recently renewed OEM arrangement with Nortel and Belden’s with single-channel WLAN startup Extricom. Remember when Airespace was acquired by Cisco? It was a nightmarish move for Nortel and other Airespace OEMs and their customers to find alternative solutions.

For its part, Verizon Wireless gets to become the largest U.S. mobile carrier, with all the glory that entails, by snapping up Alltel’s 13.2 million subscribers who are primarily in the Midwest and South. But what of existing Alltel customers with customized applications, such as field service and dispatch capabilities, running on handsets Verizon Wireless doesn’t support? Verizon might elect to certify, test, and bless those handsets – or simply not support them at all. Could that leave you in the lurch? Or does Verizon Wireless’s forthcoming “open” service bode well for the transition?

And do your contract and its volume discounts translate over to Verizon as your new supplier or do you have to renegotiate? If you’re an existing Alltel shop, it might be worth working with a telecom contract negotiation and expense management expert to examine the impact of industry moves and create a strategy for your company.

Read more about wireless & mobile in Network World's Wireless & Mobile section.

Joanie Wexler is an independent networking technology writer/editor in Silicon Valley.