Impact of COVID-19 on Smartphone Industry

Covid19 is an unprecedented event. No one was prepared for it and it caught everyone off guard. Many people are now waiting for the lockdown to get over so that they can get back to their normal lifestyle. But we are never going to have the ‘normal’ lifestyle even if lockdown ends. Coronavirus has left a lasting impact on how we, our economy, and our technology industry progress. Let’s take a look at how COVID 19 impacts the technology industry.

The new normal

Companies are exploring new and innovative ways to launch their smartphones. Since we have to maintain social distancing, a physical launch is completely out of the picture. Big brands like one plus, Huawei, Xiaomi have launched their flagship phones via live stream or pre-recorded online events. Oneplus was known for its simultaneous massive phone launch in multiple cities like shanghai, new Delhi, and new york. This time they opted for youtube live streaming while launching their OnePlus 8 series. They also capitalized on their social media reach and came out with a never seen before AR-based unboxing. This campaign got them success in creating a buzz about their newest and flashiest phone ever. Going forward, one should expect more such online events coupled with innovative campaigns.


Manufacturing meltdown

Launch of pre-build phones is still taking place but manufacturing newer phones has received a severe blow. This is because china the origin of the coronavirus also happens to be the heartland of smartphone manufacturing. With their major cities under lockdown and all supply chains disrupted, manufacturing has nearly stopped. Companies are now exploring alternatives for setting up their new manufacturing plant away from china. But it will require a hefty amount of time and the transition might not be smooth.

empty streets

Apple, which launches its new iPhones every year in September, is expected to push back its launch till October or November. Companies like PlayStation, which depend on monthly manufacturing, will not be able to deliver their expected numbers this month. Customers should brace for a longer waiting period for their smartphone delivery because of the slowdown in manufacturing.

R&D halted

Every major organization is projecting a severe recession and all major economies are expecting their economies to shrink. There is also a looming danger of unemployment of a magnitude that the world has ever witnessed. With manufacturing halted and companies trying to cut down their costs, R&D is the last thing they want to drain their money in. All major flagship R&D programs will receive a massive blow. Folding smartphones, for instance, was expected to dominate the industry in 2020. But now it seems they will be pushed down in the pipeline for at least a year. Research in the field of cameras, processors, and batteries is also expected to slow down

Shrinking Profits

Big brands have already started to witness their profits shrinking drastically. For April, the sale of smartphones in India was zero! With all eCommerce shut and retail stores forced to close, there was no way for the buyers to order a new smartphone. Xiaomi India’s managing director Mr. Manu Kumar Jain also tweeted about the issue with a tinge of humor. He said that all the smartphone brand were number 1 in India because profits for all of them was exactly zero.

no profit

With this in mind, companies might also try to launch their newer phones with a higher price tag. But it can also turn out to be insidious as one should expect the customer to be more frugal in upcoming months. Even if the lockdown ends anytime soon, people might try to save money for difficult times ahead.

The Good in the Bad

Every bad thing has a good side and COVID is no exception. With countries under lockdown and majority or population working from home, the race to 5G has received a major boost. 5G will provide much needed faster and more reliable internet speed. Video calling, downloading data, and surfing the internet all will become much more fluid. Many telecom companies are looking at this situation as an opportunity to ramp up their investments in 5G infrastructure. Facebook also recently invested 43000+ crores in reliance owned Jio company. Jio is expected to be a dominant player for setting up 5G infrastructure in Indian markets. All in all, this pandemic is going to have a long-lasting scar on this industry.

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Nitin Gupta
Nitin Gupta
Nitin is a software engineer from Gurugram, Haryana. He is an avid reader, a tech-savvy and a sports enthusiast. He is quite versatile and loves to try his hands in every different field. Surely a fun person to hang out with!

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