It feels like we're just getting used to 3G speeds on our mobile networks. Apple's
That's great news for Verizon's subscribers and high-speed 'net addicts, of course. But it's even better for shareholders of LM Ericsson
Verizon CTO Dick Lynch told Swedish tech magazine Ny Teknik that Ericsson and Alcatel beat out competitors like Nortel Networks
Helena Nordman-Knutson, an analyst at Swedish investment firm Ohman, estimates that Alcatel and Ericsson will each get about $570 million in Verizon orders this year. Verizon's aggressive deployment schedule points to another $2 billion to split between the two vendors in 2010.
Too bad for Nortel; that hardware vendor is fighting to stay alive, and it could have used this order. Both Ericsson and Alcatel booked revenue north of $20 billion last year, so this is less of a lifeline for them.
Nonetheless, it's still magnificent news. 4G technology is an entirely new revenue stream for every hardware vendor, and it's important to get a leg up on the competition with a few high-profile deals early in the game. This gig for Verizon certainly qualifies.
But wait -- there's more!
A wireless network is much more than the sum of its base stations, which is all that Nordman-Knutson based its revenue figures on. Core networks and supporting infrastructure need upgrades, too, which could double the size of the order. Verizon expects to simply spend less on 3G and more on 4G to finance this sea change, so its capital expense budget won't change too much.
Then there's the domino effect. Show off your mad 4G skills in Verizon's new network, and AT&T
It's a brave new world -- and a fast one, too. Ericsson will remain the worldwide leader in wireless infrastructure, and Alcatel just cemented its third-place position behind Nokia Siemens.
Fool contributor Anders Bylund holds no position in any of the companies discussed here. You can check out Anders' holdings or a concise bio if you like, and The Motley Fool is investors writing for investors.