1.

IMPACT OF COVID -19 ON TMT

TELCO INDUSTRY

Remote working creating high demand

PWC reports that as a direct result of a huge shift towards remote working, demand for
networking infrastructure and connectivity has increased. This poses a huge challenge in
front of these companies to fulfil the demand. If able to sail through with positive customer
experience, they would add a lot to their brand value. Simultaneously remote working for
telecom industry themselves could pose security threat to these industries itself. This also
puts a dent in continuous service supply from call-centres on which communication providers
are highly dependent.

Supply Chain Distribution

With the disruption in supply chain, the major problems are faced by mobile handset
providers. Also the network equipment delivery would be delayed leading to delays in 5G
and fiber network builds.

Role of AI and ML

CapacityMedia reports that the current crisis will propel telecom innovation around AI and
ML and a catalyst for app and innovation ecosystems.1 We will see the use of artificial
intelligence (AI) to extend call centre agents and retail stores, offering greater consumer
experience and decision taking in real time. In order to accommodate significant workload
changes, load balancing and more AI / machine learning (ML) injection into the Heart, Edge
or vRAN network, investment strategies and sustained operational efficiency must become
crucial.

Need for fast transition to 5G services and Fiber Networks

In an article, Ruediger Schicht, MD and senior, BCG talks about the changes that telecoms
will face in near future. This includes quick transition to 5G and fiber network to
accommodate remote healthcare, education and business.

Need for more Infrastructure

The building of new towers and the implementation of new tenancies could become a
problem that could impact on new revenues

Need for Automation

Another need would be automation of network operations to tackle security threats. Another
area of automation would be network configuration automation to reduce dependency on
human proximity for technical assistance.

1
https://www.capacitymedia.com/articles/3825246/the-financial-toll-of-covid-19-on-telecoms
Cellular Data for Covid-19 Patients tracking

Deloitte reports that countries would likely use more cellular data to track the spread of the
virus and affected patients.

Major Issues:

Bain and Company reports that the major issues faced by telecom industries can be
categorised into three parts:

 To deal with customer requirements while being sensitive to the current situation.
They are advised to provide discounts and data overages, to ease the transition for
people. Provision of help for service up gradation to customers. Telecom could offer
customers extensive "workplace-as-a-service" solutions, including remote working
and hardware conferencing, seamless networking services and alliances, and
applications for virtual private network (VPN).2
Payment flexibility and ad-hoc support is also crucial.
 Managing the shift from brick and mortar to online operations
It is clear for the time this pandemic is not contained the brick and mortar stores
would see sharp decline in footfall and the customer inquiries will shoot up.
Resolving congestion as traffic would spike is another top priority,
 Tackling Cyber-security
As mentioned earlier, with extreme reliance on online platforms , cyber security
becomes even more crucial. This move increases exposure to cyber attacks because
business-continuity mechanisms, such as backup servers, are not usually as reliable as
standard production systems. Adding on usage of less secured Wi-Fi networks would
definitely make the situation more dicey. Telecoms that provide security services to
consumers can offer discounted or free services during the outbreak which again
would add on to the brand value.

MEDIA INDUSTRY

Traditional Channels

The impact on this industry has been twofold. Traditional media has been impacted
negatively has many planned events and shootings have been stopped abruptly.
The pandemic has resulted in conference cancellations, both public and private, national / inte
rnational gatherings, promotions, conferences, exhibits (MICE) activities, choking the industr
y's lifeline.3

Digital Channels

2
https://www.bain.com/insights/telcos-and-coronavirus-three-steps-to-manage-the-crisis/#
3
https://economictimes.indiatimes.com/industry/media/entertainment/events-entertainment-industry-says-
covid-19-hit-60-million-livelihoods-seeks-urgent-government-help/articleshow/74805982.cms?from=mdr
However, lockdown has led to an increase in consumption of digital media and OTT and
gaming platforms.
Video streaming companies including Netflix, Amazon, Disney+ are expected to see an incre
ase in the number of subscribers on COVID-19's effect. 4

Shift in content demand

Bain and co reports that because of the coronavirus epidemic, households are consuming
more content from streaming services. Due to this there has been a shift in the trend as now
people are searching for video content that matches everybody's needs in their household.

Requirement of new content

Another challenge for these platforms would be to maintain a steady supply of new content in
the coming months, and continue to strengthen content recommendations to boost their long-
term customer relationships.

Long-term Habit formation

KPMG’s report “Covid-19: The many shades of Crisis, A media and entertainment sector
perspective” suggests that media companies could benefit long term from customer habit
formation of greater variety of content consumption during the lockdown period and general
apprehensiveness for attending social events might prevail way past the lockdown gets lifted.
However, these platforms need to work on their content banks to ensure this long term
engagement.

Remote Collaboration Opportunities with new sectors

The current situation may lead to a new trend of remote collaborations for content creation.
The recreational activities which were outdoor earlier would welcome innovation to reach
consumers at home. There could be more movie releases online as digital rights could
become main source of revenue instead of ticket sales. Producers can release content ahead of
scheduled release which will benefit both the consumers and these platforms.

Media Companies and AI/ML

Increasing uncertainty in consumer behaviour may lead to increased reliance on AI/ML for
analysis.

Credibility of Print media for News

The crisis has brought out the importance of credibility for news sources as a lot of fake news
circulation has left people confused. Post- Crisis print media could leverage this credibility to
maintain its position in the market.5

Innovation for Ad- companies

4
https://www.businessinsider.in/advertising/media/news/kpmg-india-reveals-how-covid-19-has-impacted-
the-media-and-entertainment-industry/articleshow/75124315.cms
5
https://home.kpmg/in/en/home/insights/2020/04/the-many-shades-of-a-crisis-covid-19.html
Deloitte reports that as the sector is heavily reliant on advertisements and ad revenues are
going down, there has been significant contraction too. Ad companies are focusing on more
interactive content creation for customer engagement.

Sport media companies

Many sports companies are also venturing into innovation and providing esports facility, e-
sports leagues or online stimulated events to provide content to fans. Additional services like
group viewing can also be really successful in current situation

Reduction in disposable Income

However, increasing unemployment and a decline in disposable income may negatively

affect middle class consumption of media and entertainment.

Effect on Radio Broadcasters

Radio (especially the FM players) face significant production and operational losses and may
face an existential crisis

TECHNOLOGY SECTOR

 With increased work from home (WFH), businesses that have typically supplied
desktops are being seen moving to laptops. This represents an opportunity for higher
sales of laptop, IT accessories and other mobile devices.
 For IT sector, Laptop shortages, OSP license specifications, lack of digital
communication tools, weak access to the network, physical server applications /
backup, would create problems.
 Demand for IPLC, data centre, CDN has been on the rise that is likely to be fuelled
further. The business of monetisation with the API is seeing exponential progress.
 Hardware companies can see substantial demand from companies that place large
orders for laptops and mobility devices to help employees who are now working at
home.
 Future work would increase the need for security software, collaboration, cloud
services, log management and VPN tools, etc. that could somehow mitigate the effect
on other software and services
 IT departments are likely to play a greater role in future BCPs due to enhanced remote
work scenarios and comprehensive stacking requirements, and will need support from
IT service providers in the provision of equipment, the establishment of a robust,
scalable and secure network, disaster recovery systems, IT protection etc.
 IT accessories retail re-route inventory can be explored to promote sales across e-
commerce sites for high demand products such as laptops, printers, routers etc

Identify trends and opportunities in transaction banking across industries, in a partly

Covid-19 world.
* Focus on supply chain disruption

* Consumer behaviour

* Future of work

* Digitisation across payments and trade

Supply Chain Disruptions:

 A large number of companies in the electronics, telecommunications and

semiconductors depend on China's manufacturing units.
 Also, Wuhan is an important base for FiberHome and other fiber optics
manufacturers, on which Huawei and networking firms rely. Supply disruption by
these fiber companies will adversely affect China's upcoming 5 G telecommunication
networks.
 China exports more than 50 per cent of the global supply chain in manufacturing. 
The epidemic has already caused smartphone production to decline by 12 %, while sm
artwatch production has declined by about 16 %. Laptops, PCs and smart speakers are 
a few other items that have experienced major declines.