IDC semiannual telecom service tracker predicts slight drop in consumer YoY.
Despite the rise in Internet services, COVID-19 will have no impact on Worldwide Telecommunications Services and Pay TV Spending in 2020, according to analyst firm IDC.
In the latest IDC Worldwide Semiannual Telecom Services Tracker, worldwide spending on telecommunications and pay TV services will reach nearly $1.6 trillion in 2020, a decrease of 0.8 per cent compared to 2019. This decline will continue in 2021, but at a “somewhat lower degree”.
The telecommunications services industry is proving to be one of the most resilient sectors of the global economy during the COVID-19 crisis. The anti-pandemic measures imposed by many governments that have forced people to stay at home and reduce face-to-face interactions have increased the consumption of telecom services, stated IDC.
However, the economic impact from shutting down businesses, higher unemployment, frozen tourist activities, and reduced consumer spending on non-essential products and services will have a negative impact on the market.
The mobile segment, the largest segment of the market, will post a slight decline in 2020 due to lower revenues from roaming charges, less mobile data overages due to the stay-at-home situation, and slower net additions, especially in the consumer segment.
Fixed data services spending will increase by 2.9 per cent in 2020 as the need for more fixed Internet connectivity determined by the “great lockdown” is likely to help this segment maintain growth. Spending on fixed voice services will continue to decline and will take an additional hit due to the pandemic as users will likely drop fixed voice services for savings purposes. Fixed IP voice will survive longer as the service is included in bundles in most cases.
In 2020, telecom services spending will drop in all geographic regions:
- The largest market, the Americas, will see a tiny decline of 0.04 per cent.
- Europe, the Middle East, and Africa (EMEA) and Asia/Pacific (including Japan) will dip more primarily because of the larger price-sensitive audience in the low-income countries of Africa and Asia.
Growth is not expected in EMEA or Asia/Pacific before 2022 as the users in emerging markets are expected to remain cautious about spending for some time.
