American Industry Overview: Telephone and Telegraph Apparatus
This industry covers establishments primarily engaged in manufacturing wire telephone and telegraph equipment. Included are establishments manufacturing modems and other telephone and telegraph interface equipment.
While the telecommunications equipment manufacturing industry was strong and growing in the late 1990s, by the early years of the twenty-first century's first decade, conditions had deteriorated. Ambitious infrastructure build-outs during the prosperous 1990s did not meet anticipated demand. For telecommunication service providers, this led to overcapacity and high levels of debt. By 2003 a number of providers had declared bankruptcy or were in poor financial shape. Subsequently, capital investment dropped considerably, which was bad news for telecommunications equipment companies. In 2005, several mergers and acquisitions among major telecommunications companies were in progress or in place, which negatively affected network equipment and core technology sales.