European Telcos Managing Coronavirus; Some Economic Loss Likely
The coronavirus pandemic could have contradictory effects on European telecom providers, officials said in recent interviews. Demand may rise as people increasingly work from home. or fall from customers who lose their jobs or get COVID-19. European telcos said their supply chain hasn't been affected. U.K. ISPs said they can handle increased usage. Authorities said EU privacy rules must still be followed.
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More demand for communications services is "good news" for telcos, said Aetha (U.K.) telecom consultant Amit Nagpal. The downside from reduced customer demand will be limited because "we all need our phones ... but there may be some cutbacks at the margins," such as reduced bundle size or paid-for content. In the short term, companies might get a small upside from more demand, but over the next year, "there will be some curtailing of usage/revenues in line with the economic downturn," he said: Longer term, we may all communicate more, by working from home and cutting down on business travel, which should benefit telcos. Another short-term impact could be providers suffering from not being able to run their businesses as efficiently as previously, hampering or delaying network upgrades to 5G, maintenance and other operations.
Network operators aren't aware of any impact on the supply chain for 5G, emailed a European Telecommunications Network Operators Association spokesperson: Operators pursue a multi-vendor strategy, which allows sourcing from a diverse pool of suppliers. They're supporting remote working services through their networks and restricting business travel and taking steps to keep their employees safe, the representative said.
The Body of European Regulators for Electronic Communications postponed March and April meetings and plans to engage online on key topics, it told us. Upcoming virtual meetings will be streamed. National regulators must follow the recommendations of their country's government.
COVID-19 "is an evolving situation and countries are at different stages in how they are managing it," emailed a Vodafone spokesperson. In the U.K., the operator introduced temporary precautionary measures for staff, including working from home when possible, and staggering commutes to avoid peak rushes. External meetings are done virtually or postponed, and travel between company sites and participation in conferences aren't permitted.
ISP networks are experiencing a traffic explosion in Spain, hit hard by the infection. Traffic through IP networks rose nearly 40%, and mobile usage increased by about 50% in voice, said Movil, Orange, Vodafone, Grupo MasMovil and Grupo Euskaltel. They're doing "everything possible to increase the capacity of the networks" by putting more equipment in place and ramping up existing capacity, but "these measures are not immediately effective." They urged users to be "rational and responsible" by shifting use of streaming or gaming to off-peak hours.
The U.K. ISP Association said members can handle increased demand. "ISPs are ready to handle any potential extra bandwidth and consistently assess the demands that are being put on their networks," said Chair Andrew Glover. He urged businesses to ensure systems can support a potentially large increase in remote connections.
Data protection rules don't hinder fighting the pandemic, said European Data Protection Board Chair Andrea Jelinek. "Even in these exceptional times," personal data must be protected, Jelinek said. EU general data protection regulation allows employers and public health authorities to process personal data in epidemics with a data subject's consent. Rules on processing e-communication data such as mobile location information provide it be used by the operator only when anonymized or with the data subject's consent, the EDPB said.