1) The clearest and most immediate business impact of the coronavirus pandemic was a major disruption to supply chains.
Having
originated in China, the region was hit hard as a large number of
citizens contracted the disease and many were forced into quarantine.
This led to partial and full shutdowns of
plants and factories, some of which were being used by prominent
technology companies to manufacture their goods and products. For
example, Apple experienced shortages on its iPhone supply as a result of
the company's primary manufacturer, Foxconn, shutting down much of its
production in China.
Ultimately for
Apple, this will lead to a significantly reduced forecast in iPhone
shipments through Q1 — by as much as 10%, according to estimates by
Apple analyst Ming-Chi Kuo cited by
MacRumors. And while companies often have contingency plans, which
revolve around ramping up production in a region that isn't impacted,
the rapid spread of the coronavirus across the globe makes it very
difficult to pinpoint which regions would be least affected. Even then,
the momentum and resources of the Chinese economy will not be easily
replicated — "Made in China" initiatives have seen the government invest billions in advanced manufacturing sectors including telecommunications equipment and semiconductors.
2) The spread of the coronavirus caused several of the most important tech conferences to be canceled, likely resulting in numerous missed partnership opportunities.
Most notably, Mobile World Congress (MWC), which was set to take place February 24-27 in Barcelona, was canceled due
to concerns over the virus. MWC is a cornerstone event in the
connectivity industry as it brings together the most important companies
in the space to network, share innovations, and forge new business
partnerships. Several companies rescheduled the events they had planned
for MWC, but the continued presence of the coronavirus led others to
cancel them entirely.
Beyond MWC,
Facebook canceled its F8 Developer Conference and Global Marketing
Summit, Google shifted its Google Cloud Next event to online only, and
IBM likewise had to livestream its developer's conference, which last
year hosted over 30,000 attendees. Altogether, the cancellation of major
tech events has incurred over $1 billion in direct economic losses,
according to estimates from PredictHQ cited by Recode.
Online
alternatives helped limit the fallout from canceled conferences, but
tech industries will likely still suffer a period of stifled innovation
due to forgone in-person business opportunities. Conference
attendees do not have the same opportunities to network via
livestreaming as they do attending in-person events. It would be harder
for marketers to casually share best practices over the livestreamed
Facebook Global Marketing Summit, for instance, than it would be if the
event actually took place. Though it is difficult to quantify the value
of these chance encounters or informal network sessions, the effects
will undoubtedly be felt throughout the impacted industries.
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