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Understanding the Impact of Covid19 on IT & Networking Sector

Posted by   Category blog, IT & Networking 

The effects of COVID-19 are felt around the world and are having a significant impact on the technology sector. From impacts on raw materials supply, to disruption to the electronics value chain, to inflationary risk on products. From a positive perspective, the disruption has caused an acceleration of remote working, and a rapid focus on evaluating and de-risking the end-to-end value chain. In addition, there may be potential carbon emission reductions, which could result in renewed focus on sustainability practices.

IT & Networking Sector

Potential long-term impact on technology sub-sectors

Hardware/software

  • The launch of new smartphones may be deferred due to supply chain Mobile phone users on contracts may defer replacing their devices due to lower consumer confidence.
  • While factories in Asia are reopening, companies are experiencing challenges getting production fully The short- and potential long-term impact could be significant.
  • In contrast to the parts shortage and unpredictability of supply chains dragging down the industry, software is a growth
  • Companies with remote-working technologies are already seeing increased demand as businesses increase their remote-working
  • Security software will see third-order benefits from a growing remote IT spending on security software will increase as organizations race to secure endpoints, particularly cloud-based tools, log management, and VPNs.
  • Hardware companies may see major demand coming from enterprises, who are placing large orders for laptops and mobility devices to support employees now working from

IT services

  • IT spending forecasts indicate continued demand for cloud infrastructure services, and potential increases in spending on specialized Forecasts also anticipate increased demand for communications equipment and telecom services as organizations encourage employees to work from home, and schools move to online courses.
  • Most organizations do not have a tech stack in place for a reliable business-continuity plan (BCP). Due to enhanced remote work scenarios, IT departments will play a larger role in future BCPs, and will need help from IT service providers in procuring devices, setting up a resilient, flexible and secure network, disaster recovery systems, IT security,
  • The need for ever-faster access to data and automation will enhance the focus on network equipment and communications as never before, speeding up 5G network deployments and adoption of 5G

Network equipment

  • Increase in the use of teleconferencing software as more technology companies encourage employees to telecommute will have potential benefits for companies that have technologies already deployed in that
  • Need for ever-faster access to data and automation will enhance the focus on network equipment and communications as never before, speeding up 5G network deployments and adoption of 5G equipment.

Practical next steps

Technology leaders will be defined by what they do along the three dimensions to managing a crisis: respond, recover, and thrive. Some key next steps include:

  • Evaluate the value chain and how disruptions can be mitigated and minimized in future
  • Drive technology adoption and innovation to support the “future of”
  • Consider M&A opportunities to enhance and grow technology
  • Understand demand and supply-side shocks and develop inventory strategies to buffer volatility and
  • Implement digitally enabled future of work tools, including those for business processes and back- office functions.