Peter Dinham
Monday, 18 May 2009 14:31
IT Industry -
Strategy
Page 2 of 2
“This has impacted net profitability so has attracted
headlines,” says Walker, adding that “the focus on the sensational
one-time accounting issues (e.g. asset write-offs) has overlooked the
industry fundamentals, even if many of these adjustments were
necessary, sometimes overdue”.
Looking ahead, as 1Q09 telco earnings reports
have trickled out, Walker believes that the results have been largely
consistent with Ovum’s analysis of 4Q08.
“Carriers are cutting costs fairly aggressively, with a focus on
discretionary capex items with immediate effect on cash flow,” Walker
notes, and suggests that overall most carriers are relatively healthy
despite the harsh macro conditions.
“The vendor market may be more challenged by this downturn”, added
Walker, “as Huawei, ZTE and a handful of other Chinese vendors build on
their already strong positions in global markets with a range of tools,
such as ability to facilitate or directly offer financing for their
customers”.