That's the view of four analysts at Merrill Lynch who did a comprehensive study of spending plans of large and emerging service providers. Yesterday, Teligent filed for Chapter 11 bankruptcy. Last month, Winstar went belly up. Overall, spending on telecom equipment will decline 6.4 percent this year and 8.1 percent next year, and it could be flat or fall even further in 2003, say the Merrill Lynch researchers. That's not particularly good news in San Diego.
Telecom is one of our major employers.
However, there is one bit of good news. San Diego is very heavy in the wireless segment, and that's an exception to the rule. In a word, overexuberance. Such spending zoomed by 32.9 percent in 1997, by 26.1 percent in 1999 and by 43.9 percent last year. Those were the days when investors believed that San Diego stocks such as Applied Micro Circuits, Leap Wireless, Wireless Facilities, Qualcomm and RF Industries could only go up in quantum leaps each year.