Impact of COVID-19 on the Telecommunications Industry
The COVID-19 pandemic has had a significant impact on the way we live, work and socialize. One way that we’ve bridged the gaps caused by social distancing and restrictions is to change the way we communicate.
With most work meetings (and even some weddings) held exclusively over Zoom or Skype, 2020 has highlighted the critical role that our telecommunications network and software plays in keeping the global economy running.
When figures revealed that the pandemic had pushed up internet usage by 70% in March 2020, it appeared that telcos may actually benefit from the pandemic landscape.
However, this surge in traffic did not prove enough to avoid the subsequent $43 billion loss of revenue suffered by the industry as a whole. Experts speculate that increased telecommunications usage for business purposes could not negate the impact that stay-at-home directives had on prepaid, roaming and voice charges. Many big-ticket customers, such as schools, universities and offices also had cause to pause their services or request rebates based on hardship.
Despite the loss of revenue, the pandemic has highlighted some key opportunities for positive developments within the industry, such as:
– Added Cyber Security to Address Vulnerabilities
With increased usage of cloud-based platforms for remote work and growing reliance on digital transactions, an overhaul of security and authorization procedures needs to be completed.
Many telecommunication providers are already upping their game in this respect, switching from reactive security to proactive internet safety measures, including employing real-time threat intelligence methods to target fraudulent transactions.
– Importance of Network Stability
COVID-19 caused a monumental shift in our internet usage, with online tools such as Microsoft Teams and Zoom becoming core elements of working from home.
The sudden shift in digital traffic from city centers to residential areas put considerable strain on the existing infrastructure and emphasized the importance of a robust network.
COVID-19 has also spotlighted the need for improved connectivity in rural areas, where access to learning materials and healthcare is often already a challenge.
Both areas recognized above as requiring overhaul can be significantly improved by the further introduction of 5G networks. Put simply, 5G uses fiber optic connections that travel between cell towers and switching centers. This increases the backhaul capacity required to accommodate large volumes of traffic without latency.
Early predictions suggest that 5G network disaggregation will also shake up the industry and allow more vendors to enter the market, giving consumers greater control over their services and better regulation around pricing.
Looking to the future, professional services network Deloitte puts it best, framing the telco pandemic experience as “some gain, much pain.” While the present focus on improving connectivity may temporarily eclipse research on new revenue streams, telecommunications companies can leverage their higher perceived value post-pandemic to moderately increase prices and support business growth.
That said, the industry cannot ignore the golden opportunity that has been presented to tailor solutions to increasingly unique customer circumstances. By partnering with tech companies to analyze consumer behavior and needs, telcos are in an unprecedented position to satisfy customer demands and garner favor in 2021 and beyond.
With most work meetings (and even some weddings) held exclusively over Zoom or Skype, 2020 has highlighted the critical role that our telecommunications network and software plays in keeping the global economy running.
When figures revealed that the pandemic had pushed up internet usage by 70% in March 2020, it appeared that telcos may actually benefit from the pandemic landscape.
However, this surge in traffic did not prove enough to avoid the subsequent $43 billion loss of revenue suffered by the industry as a whole. Experts speculate that increased telecommunications usage for business purposes could not negate the impact that stay-at-home directives had on prepaid, roaming and voice charges. Many big-ticket customers, such as schools, universities and offices also had cause to pause their services or request rebates based on hardship.
Despite the loss of revenue, the pandemic has highlighted some key opportunities for positive developments within the industry, such as:
– Added Cyber Security to Address Vulnerabilities
With increased usage of cloud-based platforms for remote work and growing reliance on digital transactions, an overhaul of security and authorization procedures needs to be completed.
Many telecommunication providers are already upping their game in this respect, switching from reactive security to proactive internet safety measures, including employing real-time threat intelligence methods to target fraudulent transactions.
– Importance of Network Stability
COVID-19 caused a monumental shift in our internet usage, with online tools such as Microsoft Teams and Zoom becoming core elements of working from home.
The sudden shift in digital traffic from city centers to residential areas put considerable strain on the existing infrastructure and emphasized the importance of a robust network.
COVID-19 has also spotlighted the need for improved connectivity in rural areas, where access to learning materials and healthcare is often already a challenge.
Both areas recognized above as requiring overhaul can be significantly improved by the further introduction of 5G networks. Put simply, 5G uses fiber optic connections that travel between cell towers and switching centers. This increases the backhaul capacity required to accommodate large volumes of traffic without latency.
Early predictions suggest that 5G network disaggregation will also shake up the industry and allow more vendors to enter the market, giving consumers greater control over their services and better regulation around pricing.
Looking to the future, professional services network Deloitte puts it best, framing the telco pandemic experience as “some gain, much pain.” While the present focus on improving connectivity may temporarily eclipse research on new revenue streams, telecommunications companies can leverage their higher perceived value post-pandemic to moderately increase prices and support business growth.
That said, the industry cannot ignore the golden opportunity that has been presented to tailor solutions to increasingly unique customer circumstances. By partnering with tech companies to analyze consumer behavior and needs, telcos are in an unprecedented position to satisfy customer demands and garner favor in 2021 and beyond.