Apart from mergers and joint ventures, Ovum's Kennedy said there will be continued acquisitions of smaller companies by larger vendors.
One such deal was Marconi, which was acquired by Ericsson last October.
Ann Emilson, president and country manager of Ericsson Telecommunications in Singapore, said: "In a competitive industry like telecoms, consolidation of organizations is one of the ways to strengthen one's position in the market."
She told ZDNet Asia that Ericsson's acquisition of Marconi is "a good way for us to gain scale, to deepen and to extend our technology and product portfolio so as to provide our customers with an even more complete end-to-end telecommunication offerings and products."
"Marconi's transmission portfolio has elevated Ericsson's position to an even higher level of broadband access offerings," Emilson added.
Another Ovum analyst Jean-Charles Doineau, wrote in a research note last October that the Ericsson-Marconi union was all about convergence and gaining territory in the network world. "This acquisition is all about network convergence," he said. "Buying some of Marconi's assets, Ericsson complements its product portfolio in areas which will be of a very strategic importance for mobile operators and for convergent network operators, at the same time."
At what price?
With mergers and acquisitions abound, there is always a concern that innovation might take a backseat. And like most newly-wedded couples, the merged entities also need time to learn how to live with their new family members.
Kennedy however, does not think innovation will suffer as a result of the recent vendor unions, since one driver of mergers and takeovers is to achieve scale in research and development (R&D) efforts.
"There is a concern that there is too much fragmentation in R&D efforts in the marketplace right now," he said. "It's also getting difficult for smaller vendors to maintain a level of R&D spending that's necessary to develop new products. The mergers are aimed at addressing those issues."
Barry French, communications director for networks at Nokia, said bringing together R&D skills and resources from Nokia and Siemens in the joint venture, will help accelerate innovations and create extensive synergies to deliver customer insight with "true end-to-end" capabilities.
Mergers also come with the risk that customers will be lost if both companies share the same clientele, and problems with managing customer relationship can arise during the transition period. Technology integration can also prove to be a challenge in cases where merging parties have similar products.
Kennedy explained: "If you look back at history involving large companies, quite often they're not very successful, such as the AOL-Time Warner merger, where it was difficult to integrate the cultures of the two organizations.
"Cultural integration is a major issue, particularly if the merger [cuts] across different countries, such as Alcatel and Lucent [in France and the United States, respectively]," he added.
When asked about the potential challenges in technology and cultural integration between Ericsson and Marconi, Ericsson's Emilson told ZDNet Asia: "The integration process is well underway and progress is better than expected."
To Singapore-based telco StarHub, the impact of the consolidation wave remains uncertain.
Said David Storrie, head of network and wholesale services at StarHub: "These mergers [between] network suppliers have been long expected, so it will be interesting to watch how things turn out. Obviously, as customers, we would need to find out if there is going to be any impact or change, operationally, to the current support we are getting from the vendors.
"And, of course, by the end of the merger process, it would be helpful for us to find out as soon as possible what the future direction and roadmaps of the new [merged] company will be, so that we can plan for any future network rollouts accordingly," Storrie added.
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