COVID-19 rapidly changed our everyday life. We became deprived of dozens of routine things we hadn’t paid a lot of attention to, and now we are living in a constant process of adjusting to a new reality. As you can imagine, the telecom industry went through a crisis as well as many other economic sectors. Testelium prepared an overview of the current telecommunication crisis and how companies all over the world are overcoming it.

How COVID‑19 impacts telecom operators’ economics

New changes came from different perspectives: some of them are related to the shift of customers’ behavior, some of them connected to the global financial crisis, from which telecommunications suffer among with retail, HoReCa, tourism, etc. 

The biggest challenges for the industry was caused by the following factors: 

  • people started to stay at home instead of going to the offices, the usage of video calls for business purposes significantly increased; school and university students switched from offline classes to Zoom or other platforms;
  • international traveling and in some cases even trips inside the country were banned;
  • society embraced a concept of remote work, including telecom companies, so their employees landed in the different types of workflow with different mechanics of communication.

With people stuck at home, most of them forego mobile networks and fully lean on Wi-Fi or broadband connection. However, the last one has enough capacity to handle the increased amount of users and traffic, because it didn’t surpass their limit. 

On the other hand, there are countries where high-speed broadband Internet isn’t available for thousands of households, and that may cause a lot of troubles. The countries that have already implemented 4G or even 5G can handle the situation easier.

Of course, the impact of the financial crisis on the telecommunication industry is also present. People are more hesitant to try new services during times of instability, and the most financially vulnerable groups may abstain from data bundles. 

Due to restrictions on travel, the demand for roaming services decreased, hence the income dropped as well. Though it really makes only a small percent of the total profit of telecom companies, the global market of roaming was estimated at 67.4 billion in 2019. The number is huge, and its decreasing can’t be unnoticed.

And let’s not forget about the workforce factor, which also had a lot of arisen issues in the telecom crisis. Firstly, this industry is people-centered, with processes concentrated in the offices. Remote work is a totally new environment for specialists, which can throw them off the track. Productivity, as well as the quality of communication inside the team, may suffer. We also need to consider that there are some parts of the telecommunication work that can’t be transferred to the remote mode.

Anyway, all the mentioned points are a part of our current life, and the solution is to get flexible and prepare for further possible changes. And who knows, maybe there even will be new business opportunities for telecom companies to explore?

What are the trends in telecom crisis management in 2021?

Telecom crisis management focuses on stabilizing and supporting the state and capacity which exist now and providing benefit to the customers. Here are some major points which help in the telecommunication industry crisis.

  • Your crisis management plan is a key to a successful overcome. Take it seriously: evaluate all possible threads and solutions, create a team who will be in charge of crisis issues, and act thoughtfully: some things should be implemented immediately, while the other may wait a bit.
  • Determine which of your employees could work remotely, and who couldn’t. For the last group, you need to create all security measures and guidelines to protect your team from the virus.
  • Focus on maintaining your current infrastructure and keeping it productive in the remote work world. Non-urgent software updates may harm your final client experience: people use an Internet-providing network for everything, and if your upgrade can interrupt or slow the connection down, it may lead to negative reactions. And keep in mind that you need to secure your current performance for clients. If you’re working with SMS, check our tools with efficient SMS delivery reports.
  • Try to help your community. There is a lot of power in the hands of telecom companies that can be used to help the healthcare system, for example by establishing new networks for data exchange. You can simply provide key spheres or enterprises with a free data allowance, and it will be a great help. But it’s also important to keep the quality of services at a high level, and that’s why the SMS testing tool may come in handy.
  • Make a special offer for your clients. Everyone is struggling, and it’s a good idea to support your customers with discounts. Firstly, it’s a decent thing to do, and secondly, it may help you to increase loyalty to your brand. For example, AT&AT decided to show support for those who work from home and made suspended data caps for broadband. They also created a discount package (10 USD per month) for households with decreased income.

What steps do companies take to manage the crisis?

We live in pandemics for quite a long time, unfortunately, though we already can pick out some positive cases of crisis management in the telecommunication industry. Let’s look through them:

  • Verizon, a famous US network operator, felt the thread of bad economic outcome and prepared 220+ million USD for extra reserve in 2020.
  • Some companies decided to forget about competition for the customers, like British telcos Sky, Vodafone, BT, Virgin Media, and O2: in cooperation with The Office of Communication, a local regulator, they started a national campaign to help telecom customers.
  • Vodafone, which, by the way, held its positions through the pandemics, decided to launch a multiple-step campaign to maintain its network services in Europe and help in stopping coronavirus spread.

Possible future of telecom sector in COVID reality

Though the telecommunication industry crisis made it hard for companies to keep with established workflow, it provided a place for development. The growth for telecom is still expected in 2021 by 158 billion USD

The main reason for that is that telecommunication became even more essential for society than previously, even if the financial situation worsened. A lot of people felt the importance of digitalization, so it will be a new priority. 

Small telecom companies may be in danger during the financial crisis of the telecom sector, thus they became vulnerable and open for acquisition by market giants or big investors. 

Telecom providers find themselves in high debt, and it will push them to implement changes. It’s very likely that service and infrastructure layers will be divided. Infrastructure companies can focus on developing their networks for all digital systems and secure themselves that way, while mixed companies may get rid of their infrastructure parts and save resources for improving their services.

Bottom Line

Telecommunication companies suffered from the COVID-19 crisis, as anyone else. But there is a silver lining: due to the importance of the industry, they have a lot of new opportunities to save their position and grow further. So, if you’re interested, it might be the right time for choosing telecom partners to bloom together!