T-Mobile US asked contractors to put its 5G purchase orders on hold until 2020, as delays closing its proposed merger with Sprint apparently forced the operator to alter its spending plan, Wireless Estimator reported.
Unnamed contractors told the news site the shift was an unexpected blow, with the scrapped orders representing $700,000 worth of lost income for one company alone.
An operator representative described the changes as a routine adjustment in a statement to Mobile World Live (MWL): “We are managing capital expenditures as we do every year.”
The representative added T-Mobile still plans to invest “billions to build out our network aggressively, expanding LTE coverage and performance while simultaneously laying the foundation for broad, nationwide 5G in 2020”.
Todd Schlekeway, executive director of the National Association of Tower Erectors (NATE), told Mobile World Live he is aware of the situation but did not want to speculate on T-Mobile’s plans. Generally speaking, he said “fluctuations and changes in capex on a quarterly basis aren’t new,” but acknowledged it can be difficult for small business contractors with a narrow customer base to adapt to sudden shifts.
Wireless Estimator reported one contractor was told work could continue if the company agreed to delay billing the operator for 120 days.
In July 2018, Schlekeway noted extended billing requests place a “major strain” on contractors by essentially asking small companies to act as lending institutions.
T-Mobile’s capex in the first half of the year totalled $3.72 billion. In July, T-Mobile CFO Braxton Carter said on an earnings call the operator expects to close 2019 on the “very high end” of its capex guidance range of $5.8 billion to $6.1 billion for the full year.Subscribe to our daily newsletter Back