Telecom braces for “Tariff” Storm
“[Tariffs] will certainly raise the price of equipment needed for telecommunications,” said Jason Miller, professor of supply chain management at Michigan State University.
“Higher prices will lead to lower demand. In turn, this will reduce equipment market growth,” Dell’Oro analyst Jimmy Yu said. “The impact to each system vendor will vary.’
The new tariffs pose a big challenge for the telecom industry. With a blanket 10% tariff across all trade partners and specific countries facing much steeper rates (China at 54%, Vietnam at 46%, EU at 20%), the telecom equipment vendor landscape will see asymmetric impacts. European vendors like Ericsson and Nokia, with established U.S. manufacturing presence, are likely to weather the storm better. On the flip side, vendors such as Dell, HPE, and Supermicro, that rely on Asian manufacturing, will face significant disruption.
No matter what, we could see a shift in the competitive dynamics. From smartphone supply chains to network infrastructure, the cost increases will likely cascade down to consumers through higher service prices and extended device financing periods. The timing is particularly challenging given the global telecom equipment market’s already weak performance in 2024.