Tech

Why the coronavirus epidemic threatens the new technology industry

In recent weeks, everyone has been talking about the “coronavirus”. If this qualifier actually designates a large family of respiratory infections, it is precisely SARS-CoV-2 that worries the whole world (and Covid-19, the infectious disease which results from it). France is also one of the countries affected by this epidemic.

Beyond the disastrous health consequences that the Covid-19 could have in the coming months, many industries are preparing for a difficult 2020 year. Among them is the new technology sector. 01net.com explains why.

Slow production
The most obvious consequence of the epidemic, the production of smartphones, televisions, computers and other high-tech products is strongly impacted. As a reminder, it was in China that the Covid-19 first appeared. In January, the Chinese government decided to take advantage of the New Year holidays to apply strict quarantine measures, which led to the closure of many factories. Since then, production lines have been allowed to operate again, but often run slowly. Some analysts expect a return to normal in the second half while companies like Apple have already confirmed that the virus will have an impact on its next results.

Unfortunately for Tech companies, this problem is not limited to China. In South Korea for example (where Samsung and LG manufacture products), some factories had to close because some employees had been contaminated. It should also be noted that some assembly factories are functioning properly but are experiencing shortages of parts. For example, factories that manufacture camera modules for smartphones are closed and can no longer send these components to China. Will it be necessary to review the way of producing in the future? It’s possible.

Fewer trips, more telework
For employees of large tech groups, traveling to the other side of the world is important for developing a product. Reuters recently explained that at this time of year, Apple generally loops the design of its future iPhone. With no possible trip to China, the brand may therefore fall behind. Will its future products be released in time?

Another problem, the big tech brands like Google, Microsoft, Apple, Facebook and Twitter are calling their employees to telecommute to avoid catching the coronavirus. In some cases, not having access to laboratories and other professional equipment may pose a problem. The consequences on the development of future products could be significant.

Major events canceled
What do the Mobile World Congress in Barcelona, ​​the Facebook F8 conference, the Google I / O and the GDC have in common? They were all canceled. In fact, for the past few weeks, brands have been canceling their events one after the other. In fact, only Microsoft Build, Apple WWDC (which has never been confirmed) and the big video game show E3 have not yet positioned themselves. We imagine that these meetings, too, have a high probability of being canceled.

The problem with these events is that they bring people together from around the world, increasing the risk of spreading Covid-19. The big brands therefore play it safe by canceling them, so as not to associate their name with the coronavirus. Instead, everyone seems to be moving towards the live stream model. Huawei, Sony, Oppo, Google … Rather than organizing large physical meetings, all broadcast a live video.

Towards a financial crash?
Finally, the coronavirus could have an impact on the market capitalizations of large tech companies. The market has collapsed in recent days, worried about the consequences of the Covid-19 on the economy. If it is impossible to measure the real impact of coronavirus in the world, it seems certain that the high-tech industry will experience a dark year.

4 Comments

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