The global telecom and pay-TV markets saw flat revenues in 2020 and an overall “neutral” impact from the global pandemic after a rebound in the second half of the year, according to IDC. The analyst firm pegged global revenues for last year at $1.53 trillion and expects them to rise by 0.7% this year, to $1.54 trillion.
However, there were significant regional differences in the impacts. The Americas actually saw 0.7% growth in telecom/pay TV revenues last year, IDC said, while the markets in Europe, the Middle East and Africa experienced a 0.8% loss in revenues. The Asia-Pacific region’s revenues were flat.
IDC noted that the Covid-19 pandemic was “unquestionably the most important factor” that influenced the market last year, and said that in the first six months of the year, the pandemic drove a “notable decline” in subscriber numbers and lower spending on services, due to strict lockdowns in some regions as well as individuals cutting back on their spending as a result of overall economic fallout.
While the market numbers may have ended up flat by IDC’s math, the firm noted that the pandemic “drastically changed the trends that have shaped the global telco market for a long time.” Suddenly, consumer fixed-line data services became paramount; business wireline data service “temporarily lost momentum,” IDC said, although long-term contracts mitigated some of the full impact. Wireline voice services lost small business customers to bankruptcy, and more consumer customers cut the cord as they looked for ways to cut household spending. Migration to over-the-top services for pay TV also accelerated, due to increased video consumption and the launch of new OTT services during the pandemic.
On a global basis, IDC said, “mobile services spending also declined slightly due to slower renewal of contract agreements, reduction of out-of-bundle spending, and a sharp decrease in roaming revenues due to travel restrictions.”
Going forward in a post-pandemic world, IDC expects that connectivity will be treated as a more critical asset because some patterns of remote work and online media consumption will be permanently changed. It expects to see fiber-to-the-premise deployment accelerate and at the same time, that the enterprise market for fixed-line data service will recover in the longer-term due to cloud adoption. 5G, it says, will boost mobile service revenue “to a degree.”
“The global telco market was put to a serious test in 2020 and it successfully passed,” the analyst firm concluded, adding that it “believes that the lessons learned last year will help the industry to secure stable growth in the coming period.”
