Coronavirus and the IT industry - what is happening now and what can be expected in the near future

Regions infected with coronavirus

The fact that coronavirus has the strongest influence on the whole world can be judged by the fact that on Habré articles on how to protect yourself from the disease and a description of the quarantine situation in different countries occupy the top most read for a day and a week .

But how does COVID-19 affect the IT industry? It is logical that since all this began in China, all technology companies that are somehow connected with the Celestial Empire are affected. Experts say that investment in IT is already declining, deliveries are being delayed or canceled altogether, and the business simply does not know what to do and where to run. This article compiles forecasts for the technology industry and talks about what is happening or has already happened.

Duration of influence

To understand what is happening on the market now and will happen in the future, it is worth sharing the influence of the virus (or rather, security measures against its spread).

Short-term impact

This has already happened and is happening. The problem is that the pandemic has led to delays in the supply of equipment from China. This was felt even by ordinary users, who suddenly saw in the AliExpress order panel an extension of the delivery period by several weeks. Some orders were canceled altogether. And of course, this is a problem for users.

But for business this is not a problem, but a critical issue, because the continuity of business processes depends on the delivery time. Even a delay of a couple of days can lead to the collapse of a single business. What can we say about a few weeks. Imagine that you have an agreement with an investor in two weeks to show a working prototype of the device. Boards for it, as well as body parts ordered in China. And suddenly it turns out that all this will either never be sent at all, or will be, but by the summer. “Chef, everything is lost” is the mildest description of what is happening in this situation.

Medium term impact

Here we are already talking about investments. Gradually, their volume is reduced, as investors are not going to risk their money. Although they say that the best time to invest is a crisis, most investors do not think so.

If a pandemic does not lead to serious consequences for the global economy (and most likely it will), then the effect of a decrease in investment will play its role for 2-6 months. If then everything goes well, investors will perk up and invest their money in IT again.

In addition, the manufacturing crisis in China has shown the need for diversification of production facilities for vendors. Already, many of them are in search of production capacities outside of China. In the future, this trend will only intensify.



Long term impact

Companies are gradually switching to remote work mode, adapting to current realities. The experience gained now will affect the IT industry of the future. Among other things, the demand for technologies for remote work organization is already growing significantly. And this trend is long-playing, the udalenka will gain momentum even after the pandemic is over. The evolution of IT in the direction of remote work is now much more active than in the last couple of decades.

Companies are gradually engaged in optimizing business processes, logistics, work processes. Infrastructure is changing.

Who will suffer the most?

It is only about IT companies, it is clear that representatives of other industries will also suffer, but here we are only talking about hi-tech business.

Companies that rely heavily on supplies from China. The companies will suffer the most due to the consequences of the coronavirus, whose work largely depends on supplies from the Middle Kingdom. These are manufacturers of any computer equipment, mobile devices, game consoles, etc.

Companies that develop software for transport, tourism and other types of business. The volume of deliveries of goods is reduced, which means that the economic efficiency of transport companies is decreasing. In addition, travel companies suffer as well, because the borders between countries are blocked, hotel reservations and trips are canceled.

Companies that conduct public events. We are talking about all kinds of technology companies whose activities include conferences, exhibitions, seminars, etc.

In many countries, all major events of any nature have been canceled - at least demonstrations, at least technical exhibitions. As for the latter, the Mobile World Congress (MWC) 2020, which was supposed to be held February 24-27 in Barcelona, ​​was canceled. It was canceled just because of an outbreak of coronavirus.

In addition, the game exhibition E3 2020 has been canceled. Multiple cases of coronavirus have been recorded in the United States, so the organizers decided to cancel E3 2020 by hosting the event online. True, the organization of such an event is still in question, since nothing like this had been held before. This is the first time in a quarter of a century that the ESA has had to change plans so dramatically.

What about gadgets?

With a very high degree of probability, Apple, Huawei (including the Honor brand), Xiaomi, Vivo, realme, ZTE, Lenovo, Sony, Microsoft and other vendors will transfer the deliveries of old and the announcements of new devices. The problem is the same - the shutdown of production facilities in a significant part of industrial China. In addition, there is no point in selling or announcing the device if no one is buying them (after all, shops are closed for the quarantine period), and offline events cannot be held.

At Apple, for example, a large number of iPhone, iPad and Apple Watch models are assembled at the Foxconn and Pegatron Corp factories located in an area close to Wuhan. The employees of these companies spent a long time on New Year's holidays, and then - in quarantine.

Accordingly, Sony and Microsoft are likely to postpone the release of the PlayStation 5 and Xbox Series X. All this is produced and assembled in China, and China ... But we will not repeat it.

And something else

There are unexpected consequences of anti-virus measures. So, a large number of people in different countries are now sitting at home - around the clock. They just have nothing to do. So, people go to the Internet - who to play, what to read, who to watch movies. And this means a multiple increase in the load on the networks of these countries. Now in Europe, the Internet per unit time goes much more users than before.



Perhaps in some regions the network infrastructure is designed for multiple traffic growth. But, as you know, where it is narrow, it breaks there, which means that blackouts of different durations are possible.

The most noticeable problem is in Italy, a European country that has been hit hardest by the coronavirus. According to Telecom Italia, over the past two weeks the volume of traffic in this country has grown by two-thirds, and growth continues. A significant part of the increase is due to the fact that Fortnite or Call of Duty lovers sit around the clock. Another factor is free porn offered to residents of the “quarantine” regions by Pornhub.



Everything would be fine, but if users start massively downloading multi-gigabyte updates to games, a collapse may begin in data transmission networks.

By the way, the problem is relevant not only for Italy, but also for Britain, Sweden and other countries. and becomes relevant for the countries of the former USSR.

In general, in the near future, the IT industry does not have the most fun prospects. Of course, everything will depend on the epidemiological situation - the longer the pandemic lasts, the worse for all of us. Delaying the release dates of the PS5 and flagship smartphone models here is a lesser evil, the real problems, apparently, are only just beginning.

On the other hand, if all countries respond to the problem as quickly as China, then the consequences may not be so severe, and the situation will begin to improve closer to summer.

Despite all the difficulties, Zyxel is optimistic about the future. So, now more and more popular is remote work, i.e. udalenka.

Application Diagram Zyxel

Zyxel offers several solutions for creating remote workstations:
Security Gateways with VPN functionality
Software solutions