Strand Predicts Change for USF Payments and Smartphone Production
Strand Consult said in its year-end predictions that pressure is likely to continue on big tech companies to pay into the USF. “The largest internet companies Alphabet, Meta, Apple, Amazon, Microsoft, Netflix, and TikTok derived an estimated $200 billion in revenue in 2024 from the 135 million users connecting to the internet through the USF,” Strand said last week. The companies earned on average $2,600 in 2024 through every household connected, it added. An “explosion of data centers is poised to exacerbate this free ride if left unaddressed.”
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Strand also predicted that global supply chains will shift as companies move production out of China and closer to end markets. In 2017, 100% of iPhones were made in China, but that started to change during the first Trump administration, the firm said. India now makes 20% of iPhones, and U.S. smartphone shipments assembled in China decreased from 61% in Q2 2024 to 25% in Q2 of this year. Strand cited one analysis that found that “Made-in-India” smartphones “now account for 44% of smartphones imported into the US, up from 13% in Q2 2024,” and India now produces 20% of the world’s smartphones.
Next year is likely to prove “pivotal … for advanced public-private communication partnerships,” Strand said. “Digital sovereignty and network resilience will be decisive. Operators that have invested heavily in Chinese infrastructure are likely to face increasing difficulty meeting the security and resilience requirements imposed by national authorities.”