Ashwin Nambiar, lead ICT procurement analyst and advisor at Beroe Inc., has taken to LinkedIn over the past several weeks to provide insight into the effects the Covid-19 pandemic is having on the telecommunications industry. Through these updates, he has indicated that information and communications technology (ICT) services as well as IoT connectivity have emerged as growth areas within the sector that, overall, is contracting.
On April 16 Nambiar posted “Covid-19 and the Telecom Industry – The Fallout and Path Ahead.” In that post he prefaced that the telecom sector “has a lower level of risk exposure … when compared to other sectors like electronics manufacturing, food and non-food retail, hotels and meetings, automobiles and airlines, etc.” But he followed that preface by stating that he expects Covid-19 to have a “major impact on the global 5G rollouts and device development. Pilot testing is getting delayed due to both supply disruptions as well as unavailability of field service technicians to work on sites.” Device development is also being delayed by shutdowns, he added.
Nambiar added that the pandemic’s effect on internet speeds is small and short-term, yet significant. “There is a noticeable degradation of internet speeds in North America and Europe,” he said on April 16. “The drop is more noticeable over the past two weeks as more countries are increasing their lockdown measures … Telcos and regulatory authorities are working with OTT video streaming service providers to tackle the issue …”
He provided an update on April 22 he pointed out that in China, telecom-service revenues increased about 1.5% in January and February, when the virus was spreading and lockdowns were being put in place. Despite that initial uptick, “the pandemic has adversely affected most shores around the world now, and nearly all developed and developing countries have adopted stringent measures like lockdown. In light of the emerging scenario, the overall telecom revenue is expected to decline by approximately 3 to 3.5% in the mature markets in 2020—which a couple weeks earlier was expected to be less than 1%.”
Nambiar further stated that consumer services, which constitutes more than 65% of total revenue, will not be impacted substantially. “And consumer digital services will witness around 15% growth in revenue,” he added. “Fixed and mobile services of business/corporate segment is expected to witness a decline of around 10 and 12%, respectively. However, ICT services and IoT connectivity will experience an uptick of 5-7% and around 12% respectively.”
Read Nambiar’s April 16 post here and his April 22 post here.