Vendor financing unlikely to return

We're almost a decade removed from an era in which start-up carriers often were coaxed along in their ambitious network expansions by attractive vendor financing deals for gear and services. Those practices became even more prevalent as the young carriers sank under piles of debt and needed even more help to survive. When some of those carriers went belly up, vendors paid the price for providing essentially free equipment or agreeing to long-term bills that they could no longer collect.

Economic realities are again applying pressure across the telecom industry, but Light Reading Europe suggests that vendors such as Nokia and Alcatel-Lucent are in no mood to help carriers out again with vendor financing deals. That's no real surprise, but in some ways, managed network and service deals in which vendors take over management responsibility for carrier networks or services seem to hold a similar risk. These deals often result in vendors hiring hundreds of carrier employees. Will the long-term pay-off be worth it, or will the long-term costs involved remind vendors of a previous era they would rather forget?

For more:
- see this story at Light Reading Europe

Related articles
Longer carrier buying cycles may be hurting vendors
AT&T said its capex would be lower in the second half

Suggested Articles

LF Edge, an umbrella organization that's part of the Linux Foundation, announced the second release of its Akraino Edge Stack.

Chris Young is leaving his role as CEO of cybersecurity firm McAfee to become a senior advisor with TPG Capital, which has a majority stake in McAfee.

CenturyLink wins a $1.6 billion contract with the U.S. Department of Interior to upgrade its network services and modernize its IT solutions.