Why should it affect them in any way. Telecoms as an industry is actually increasing profit and relevance from covid19 as communications services are in higher demand.
If there are any effects , they will be very positive due to permanently increased communication needs due to drastically increased disitalisation of work live and of companies.
To keep profits at current levels, producing industries will increase automation to compensate the cost increases from shortening their supply chains to reduce dependencies from China and India, as China will be most likely again the origin of the next virus, just as it has been before.
This in turn will increase demand on the telecommunications services.
Finally, only telecom companies can provide the data to plot movement of people and to reconstruct infection chains.
So, for telecoms, the post covid19 future is bright.
I am afraid the future doesn’t look very promising at all. As we all know companies tend to cut investment and expenses when uncertainty is in place especially at consulting and telecommunications are not an exemption even though the sector is not so affected as others.
Anyway it might be too soon to predict anything we’ll have to wait for the 1Q results.
Best for all
Telcos services are essential in times like this so matter how long this continues the sector looks promising. However, the challenge lies in the mode of work. Whilst it is important to stay safe and maintain social distancing, the mode of work is shifting to virtual or remote working. I see permanent employees being affected because most employers or managers prefer to micromanage and therefore would want to see them daily and control their action to deliver results as traditionally done. The mode of work of consultants differ. Most consultants work remotely and interact with stakeholders and give projects update via video conferencing apps and probably maintain physical meetings at monthly or quarterly level. So consultancy opportunities look promising in times like this but the cost associated with services of a consultant vs permanent employee is another leg employers may look at critically in their consideration.
In general all the companies/organisations needs to redefine the concept of working space. I grew up at Nokia and already in 2001 it was possible to work from home. COVID19 is just pushing more in that direction. In city like London, where employees/consultants waste hours in commuting, COVID shows that employees are still productive. Companies need to trust more either the employees or the consultant and start to have more a startup mindset and of course change the processes how to manage people and logistic. It’s a bright future, more productive and less time wasted in commuting when it’s not need.
The impact is uncertain. While it’s true that the outlook for telecom, online and tech in general seems better that other sectors, we might be on the brink of one of the worst crisis in the last century, which might offset any potential surplus for telcos. Very hard to guess without a lot of data.
Consultants and telecommuting might improve, it’s just that there might be no companies to consult for. Time will tell.
I am one of those who foresee better future in terms of job opportunities and business growth .
Changes are always part of the lifecycle overall , so whoever is ready to accept and adapt it , will be wise. The Virtual Work Environment is the reality and future , get ready for it:)
Telecom industry along with e-commerce , Mobile financial services & contactless payments industries going to get more revenue and business share in coming years.
I am one of those who foresee better future in terms of job opportunities and business growth .
Changes are always part of the lifecycle overall , so whoever is ready to accept and adapt it , will be wise. The Virtual Work Environment is the reality and future , get ready for it:)
Telecom industry along with e-commerce , Mobile financial services & contactless payments industries going to get more revenue and business share in coming years.
Covid crisis is already putting under severe stress the economies of a relevant number of countries and the outloos for the coming quarters are not optimistic at all. Under these circumstances customers will turn to be highly price sensitive and an increase in the competitive pressure in terms of new price wars is to be expected among Telco players of all developed markets. Low price offers will turn to be more aggressive including “more for less” offers as a means of both acquiring new customers (ie growth of number portabilities) and retaining the existing base.
As a result Telco’s P&L will be under two pressures: arpu decline hitting the top line and cost upsides linked to commercial effort as well as to service related costs.
In order to preserve ebitda (let’s better talk about minimising the negative hit on ebitda), Telco’s will react cutting all sort of discretionary opex and they will also push the pain through the chain revisiting the terms of existing Opex contracts. P&A opex will also be optimised looking for higher ROI’s and lower payback’s. On the side of cost of labour, in the short term further layoffs are to be expected looking for efficiency leveraging not only on the impact the downturn is already having but also on a more flexible approach of Unions who will accept cuts in order to preserve the bulk part of the employment.
Consultancy initiatives will, for sure, be reduced in a significant way as Telco’s will focus on their mainstream revenue sources, avoiding to get in the short term into new initiatives. They will also move into a DIY mode.
Some opportunities will also arise, mainly related to RPA and digitisation, always looking for cost optimization and efficiency.
On the Capex end, network reinforcement will capture the bulk part. Covid crisis has pushed digital behaviour of the customer base and Telco’s cannot afford a weak network close to collapse. Network expansion should happen but based on network sharing agreements as well as leveraged on the active role which is starting to be played by Infrastructure Funds, TowerCo’s and NetworkCo’s.
Last, but not least investments in 5G will be slowed down as cash will be under pressure.
Does that make sense?
Best
I think this question needs to be addressed with a mid- to long-term time horizon in mind. Certainly, there will be some short term impact DURING the crisis and lockdown period as well as shortly afterwards. Will overall demand increase? Well, it could hit both ways: when not on the road, we communicate less; but when we are working from home, we need more data… Probably total usage won’t change significantly. And neither should costs. But we should expect a shift in the type of demand—towards applications which assist in the reduction of transaction costs for home-work. But as soon as the dust settles… what will remain?
Consider classic concepts like the 5 Forces or Industry Evolution or Margin Migration across the value chain… Why would COVID impact on the power of the customer or the supplier etc.? The fundamentals of the product will not change; we will not see a more sophisticated customer or a merging of suppliers or similar. And thus it is unclear why the margin should be impacted in any fundamental way or maybe move up- or down-stream. And thus I wouldn’t expect COVID to cause any fundamental shifts in employment patterns nor the need for advisory services.
And I don’t think this is unique to the telco industry. This should be pretty much the same for most industries—except those sectors or activities which are involved in the provision of products or services directly related to an epidemic. I would hope we will learn from the current levels of preparedness (lack thereof) and start investing into prevention or management systems for a similar situation in the future. So maybe insurances, health care providers, and medical suppliers should see an upswing? But not anyone else really.
In the longer term the outlook for employment in the telco sector is promising both on the consultancy as on the permanent basis. The very simple reason is that the covid-19 situation is likely to increase the demand for telco services due to people working from home, high quality video conferencing and related security services etc. If this will benefit permanent compared to consultancy services the most is more difficult to judge. However, the fact that many companies also telcos have had good experience with remote working is likely to benefit contractors and consultants the most as these experiences is likely to further strengthen to fluency in the job-markets that we are already seeing. In this environment flexible contracting is likely to benefit the most.
However, naturally in the short and perhaps in mid-term the lack of certainty on the overall economic outlook is likely to hamper new employment in any sector.
As long as you keep yourself up-to-date with new technologies and trends, you will add value and stay relevant. Make sure you keep on learning.
Covid pepped up Telecom as most industries adopted digital and remote working, its well placed and will boost as 5G implemented. Capital expenditure increasing and project implementation in full swing, so consulting opportunities ll be more.
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