- CommScope is cancelling its fiber manufacturing expansion in N.C.
- The state pulled the plug on CommScope's 2023 job development investment grant
- CommScope's decision was likely a result of both the Amphenol deal and BEAD, said Dell'Oro VP Jeff Heynen
CommScope said so long to its plans to expand its fiber manufacturing plant in Catawba, North Carolina.
According to the Charlotte Observer, the company cancelled a $60 million plan that intended to create 250 jobs due to financial uncertainties. CommScope informed the state in December that it would not achieve its local hiring or investment goals, and this week the North Carolina Economic Investment Committee terminated the company's nearly $2 million economic development grant.
The news comes just after CommScope closed its $10.5 billion sale of Connectivity and Cable Solutions (CCS) to Amphenol, which included the name and brand. Bit by bit, the company has sold off chunks of its business to deal with its heavy debt load, which stood at roughly $7.3 billion as of September.
Amphenol, a Connecticut-based interconnect vendor, also acquired CommScope's outdoor wireless network (OWN) segment and distributed antenna systems (DAS) businesses. About 20,000 CCS employees will be joining Amphenol, the company said in a press release. What's leftover of CommScope rebranded to Vistance Networks.
Is BEAD behind the cancellation?
The Amphenol transaction is probably the biggest reason for dropping the manufacturing plans, said Dell'Oro Group VP Jeff Heynen, but it could also be due to the delays in the Broadband Equity, Access and Deployment (BEAD) program.
After a year of uncertainty and restructuring, NTIA has approved most of the state BEAD plans and the broadband industry's hopeful construction can finally kick off this year. But access vendors probably won't get much revenue from BEAD until 2027, as Heynen previously told Fierce.
"The fiber opportunity for BEAD has certainly been reduced after the latest rounds, and that might have resulted in CommScope not needing to construct a new facility due to reduced demand for BABA-compliant fiber," he said.
"But I also think Amphenol didn’t want to commit to the new facility when it has to focus on integrating the CCS business and potentially using existing locations for fiber manufacturing instead," Heynen added.
Per the Charlotte Observer, CommScope intends to remain in North Carolina, where it currently employs 1,476 people.
Following publication, a CommScope representative reached out to clarify these were actions done by the CCS business, which still identifies as CommScope, not Vistance Networks. This story has been updated to reflect that.