The radar screens at Newark Liberty International Airport showed a brief disturbance.
went blank
on Friday morning. It’s another sign that America’s air-traffic control system needs an overhaul. One is coming. That’s good news for airlines and fliers. It will help some companies, too.
On Thursday, against the backdrop of a
fatal crash
In January, and with recent travels
chaos at Newark airport
Transportation Secretary Sean Duffy unveiled a cutting-edge air-traffic control system. This advanced setup, anticipated to require three to four years for construction, includes updated telecommunication infrastructure, radio equipment, and ground-based radar technology. “Our aim is to provide air traffic controllers with all necessary resources to maintain safe distances between aircraft,” explained Duffy. “Both external interfaces and internal support systems will be entirely modernized.”
New radio systems, radar technologies, and telecommunications mean fresh income sources for businesses. However, it’s clear that there aren’t going to be any major beneficiaries; the comprehensive changes won’t be significant enough.
The Airlines for America trade organization estimates that the restructuring will require between $30 billion and $40 billion, as noted by TD Cowen analyst Tom Fitzgerald in his latest analysis. A significant portion of this money—about half—will be allocated towards enhanced communications systems and technological upgrades, with the remainder directed toward personnel and infrastructure improvements.
Approximately $20 billion equates to around 5% of yearly revenues for Verizon Communications, AT&T, Cisco Systems, Thales, and L3Harris Technologies. Furthermore, this $20 billion would be allocated over several years, and these figures represent just five firms likely to profit from the enhancements.
Verizon and AT&T run telecommunications networks. Verizon emerged as the winner.
2023 contract
worth $2 billion to “design, build, operate, and maintain the FAA’s next-generation communications platform.”
That contract’s status might still be uncertain. While any alterations or reductions would indeed be unfavorable, they would likely be minimal. Verizon did not provide an immediate response when asked for their comments.
Verizon did not seem affected whatsoever. Its shares increased by 0.4% during early trading on Friday, whereas both the S&P 500 and the Dow Jones Industrial Average declined by 0.3%.
Cisco produces telecommunications gear. Thales and L3Harris specialize in radio communication technology. Additionally, the government might consider SpaceX’s satellite-based solutions. Tesla CEO Elon Musk’s aerospace manufacturer manages an array of over 7,000 satellites aimed at providing fast internet via Wi-Fi.
to millions
.
Other providers of communication gear also exist. These are merely some options for investors to explore. Ultimately, the greatest beneficiaries could be American travelers experiencing less delay and hassle due to an outdated system.
Send your letter to Al Root
[email protected]
and Anita Hamilton at
[email protected]
