Wireless Winners and Losers in 2012
The wireless industry continues to grow at a rapid rate, and last year saw big developments for some of the largest wireless companies. Perhaps the biggest news in the wireless industry last year was the thwarted merger of AT&T and T-Mobile, though other large wireless corporations such as Verizon made the news with the expansion of their own LTE (Long Term Evolution) network, a radio platform technology designed to offer better spectrum and mobile coverage. An increasing number of wireless companies made commitments to utilize the new LTE technology in 2011, including Sprint and Clearwire. Unsurprisingly, the turmoil of 2011 bleeds into the beginning of the New Year, and with the changing landscape comes a new set of winners and losers in the wireless industry. As with 2011, the biggest wireless industry issues will be mergers and contests over which company offers the most spectrum for their users.
Losers
The highest profile wireless industry loser for the new year is T-Mobile, as the merger denial left the company with a lack of spectrum bandwidth to offer their customers, despite the spectrum given to T-Mobile by AT&T after the merger denial. Forbes magazine predicts that T-Mobile will merge with Dish Networks in 2012 to form a more powerful wireless alliance. Forbes also predicts a lean year for wireless company Clearwire, as a great deal of capital will be needed to convert their WiMAX network to an LTE network. While this transition may pay off handsomely in the near future, it will also put a sizable dent in Clearwire's immediate finances, making it a temporary "loser" for the first few quarters of 2012. Another potential wireless industry loser for 2012 is LightSquared, which may not be given clearance to launch its data service, as it will likely cause severe GPS interference with existing technologies. This denial of operation will lead to significant investment losses for the company, which will make it vulnerable to takeover.
Winners
One of the biggest wireless industry winners for 2012 will be AT&T, which is predicted to begin offering their LTE service on a nationwide basis this year. AT&T's merger with wireless industry Qualcomm will help make the process faster and more powerful, spreading out from the major cities which AT&T already provides LTE service to. While this will make AT&T a winner in an obvious sense, it may also cause a bit of negative PR for the company, as it will prove that AT&T didn't need to merge with T-Mobile to provide better service. If there's a great deal of press coverage on what was likely a deceptive attempt to eliminate competition and stifle innovation from other companies, this coverage could cause headaches in the form of bad press and shareholder disgruntlement. Another potential wireless industry winner for 2012 is Sprint, which may be in a position to take on the customers that will be left behind if LightSquared goes under. This will lend increased momentum and profit to Sprint, which is already in the process of rolling out an impressive network of LTE service for the New Year. Additionally, Verizon will likely have another strong year, with its LTE technology already fully functional and ahead of the competition.
