An alleged Trump administration report arguing that the government should build a nationalized 5G wireless network has drawn some skeptical responses, including a rebuke from Federal Communications Commission Chairman Ajit Pai. If the proposal is legitimate and were to be implemented, however, it could ripple through industries ranging from wireless gear to internet advertising.

Axios published the 30-page report late Sunday, saying the document was created by "a senior National Security Council official" and had been circulated among senior Trump administration offices.

The plan would help companies that make telecom infrastructure gear such as Nokia (NOK) , Ericsson (ERIC) and Cisco (CSCO) , due to increased spending, but would have have mixed implications for AT&T (T) and Verizon (VZ) . It could also be a boon for Alphabet (GOOGL)  and T-Mobile (TMUS) , given their assets and interests, but cable operators such as Comcast (CMCSA)  and Charter (CHTR)  could lose if the government speeds up deployments of a wireless service that could compete with wired broadband. 

Dominance in 5G networks will translate into success in artificial intelligence, the Internet of things and other burgeoning technologies, the alleged report states. According to the proposal, the U.S. government would build one big 5G network and lease capacity to the telecom providers. The network would protect the U.S. from cyber attacks and from competition from China's growing tech industry, the document stated. 

FCC Chairman Ajit Pai suggested that the proposal is misguided. "The main lesson to draw from the wireless sector's development over the past three decades -- including American leadership in 4G -- is that the market, not government, is best positioned to drive innovation and investment," Pai said in a press release on Monday.

The report argues that the Chinese government tilts the playing field in favor of domestic equipment giants Huawei and ZTE. Beijing allocates 70% of its mobile infrastructure market for Huawei and ZTE, the report charges, and provides Huawei with $100 billion in credit for deals outside the country.

Huawei disputed the allegations, however. "Huawei competes openly for network contracts just as any other vendor, in any market in which we are welcome," a company spokesman said in an email. "There is no $100 billion in credit to Huawei from any government."

Tech vendors such as Nokia, Ericsson and Cisco would benefit from the government buildout, Morningstar analyst Ilya Kundozerov said. "Anything [the government] builds is likely to be more expensive," Kundozerov added. A federal program would spend more in rural areas, for instance, where the wireless carriers have less incentive to invest.

Nokia gained 2.8% to $4.95 on Monday. Ericsson rose 1% to $6.99 while Cisco increased by 0.6% to $42.82.

In addition to those companies, the report anticipated the reactions of several other companies.

Google would support faster, ubiquitous broadband service that could allow it to sell ads, the report suggested. However, Google has supported a spectrum-sharing proposal called the Citizens Broadband Radio Service that allows companies to deploy broadband service, and the report suggested the company might prefer that option to a nationalized network. Google did not immediately respond to a request for comment for this sotry

Verizon's reaction could be mixed, the report suggests. The telecom would favor a "faster/cheaper 5G buildout." However, the company has been investing heavily in 5G and plans commercial launches of wireless services to fixed locations this year. A government building out could marginalize its investment, the report notes.

AT&T could be troubled if the 5G plan required changes to the spectrum that DirecTV uses, the report noted. The telecom noted in a statement that it will be the first carrier to launch 5G mobile services in 12 markets this year. "We can't comment on something we haven't seen," a spokesman said. "But, thanks to multi-billion dollar investments made by American companies, the work to launch 5G service in the United States is already well down the road." 

Meanwhile, Sprint might benefit from a "more level playing field" with AT&T and Verizon, the report suggested. And T-Mobile would likely be a strong supporter, the plan predicted, because the carrier lacks the spectrum for a nationwide 5G deployment.

Finally, the buildout could be negative for cable operators such as Comcast (CMCSA) and Charter (CHTR) , as the new 5G network would create a competitor for their broadband services.

Separately, BTIG analyst Walter Piecyk noted in a Monday report that wireless tower operators such as American Tower (AMT) , SBA Communications (SBAC) and Crown Castle (CCI) would benefit from the network. 

Developing 5G will require $200 billion worth of investment in fiber networks, the alleged Trump administration report suggests. That would be good for optical fiber manufacturers such as Corning (GLW) and CommScope (COMM) and construction outfit Dycom (DY) , Piecyk added.

However, Piecyk was doubtful of the plan's prospects. "It does not appear likely to us that this recommendation could be accepted or evolve as government program that would be implemented as described," he wrote, noting FCC Chairman Pai's opposition to it and the aggressive time frame for the project. 

The project seemed "a bit utopian" to Morningstar analyst Kundozerov."This seems to be driven by cybersecurity concerns," he said. "The problem, though, is that there appears to be a lack of understanding about cybersecurity." Building a nationalized network would not ensure security, he suggested. Equipment manufacturing and coding would also have to be done in the U.S., among other steps.

FCC Commissioner Michael O'Rielly was also dubious, comparing the proposal to one of the truly epic fails in the history of U.S. industry. "I've seen lead balloons tried in D.C. before but this is like a balloon made out of a Ford Pinto," O'Rielly said in a statement on Monday. The Pinto was famously recalled in the 1970s because of concerns over exploding fuel tanks during collisions. 

Alphabet and Comcast are holdings in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells GOOGL or CMCSA? Learn more now.

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