The impact of COVID-19 on the global economy has been immediate and severe.
No industry is immune to the contagion – productivity and revenue declines are generally universal.
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Predictions for the ICT Industry
Early indications from China’s ICT sector serve as a useful base for predicting the impact of COVID-19 on ICT sectors in other geographies:
Key Take-outs for the ICT sector from the COVID-19 Crisis
The ICT industry like many others, will experience a decline in revenue as global supply chains and local demand grind to a halt.
In the short-term, the sales mix will shift as demand skews towards cloud services and some software. Demand for hardware will be muted for some time.
End-customer’s businesses that have continued to provide essential services may thrive in the short-term but will experience a tapering off in demand as a prolonged economic recession takes hold.
Recovery in the medium term is expected to be slow as end-customers:
- Permanently cease operations
- Reduce operating costs, capex and the size of their workforce
- Prioritise spend towards business recovery
Mass workforce redundancies and muted consumer spend in the long-term will continue to negatively impact end-customer businesses. It is unlikely that consumer demand will return to pre-COVID-19 levels for several quarters.
It is unlikely that consumer demand will return to pre-COVID-19 levels for several quarters.