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The Tech Industry Feels the Damaging Impact of the Coronavirus Outbreak

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Rajan Sarma

Health experts around the world are struggling to understand and contain a new family of viruses named as Coronavirus that first appeared in mid-December 2019 somewhere in the Wuhan province of China. Initially affecting China, the Coronavirus outbreak has swept through the rest of Asia and Europe. Within a span of just three and a half months, Coronavirus has claimed over 89,000 cases and has taken up to 4000 deaths worldwide, making it a truly global epidemic.

The impact of Coronavirus has been so far-reaching that its effects can be felt in the tech industry as well. The Tech Industry is currently jolted by the impact of the virus with several companies shutting down stores and factories in China, and also restricting employees to travel to China. At the beginning of the New Year, many multi-national tech companies such as Apple, Samsung, Microsoft, and Google had temporarily shut down their corporate offices and manufacturing units without issuing any notice regarding their re-opening. Similarly, companies

such as Facebook, LG, and Razer have barred their employees from making any unnecessary visits to China. With more than 50 airlines worldwide suspending its flight operations to-and-fro from China, the country has been left aloof from the rest of the world since the deadly Coronavirus outbreak.

Coronavirus has negatively impacted global technology supply chain companies since China manufactures almost half of the global electronic and pharmaceutical products and is the largest manufacturer in the world. Experts are warning customers of a potential global shortage of various smartphones, VR headsets, cars, and numerous other electronics. According to a briefing by global analytical firm Dun & Bradstreet the subsequent shutdown in China is going to disrupt 5 million other businesses worldwide. Producers of Smartphones and other electronics are facing a significant loss of revenue and productivity not only in the factories of Wuhan where the disease originated but also throughout China.

Multiple tech companies are limiting their event travels as well since the virus outbreak. For instance, companies such as Sony, Amazon, Nvidia, and L.G Electronics have all pulled out of the Mobile World Congress Conference (MWC) in Barcelona. Game developers like Facebook Gaming, Oculus and Play Station have pulled out of many gamming events and conferences too. Similarly, Blizzard Entertainment has also cancelled its Overwatch league matches which were due to be held in February and March. PUBG's global qualifier event, to be held in April at Berlin has also been postponed due to the Coronavirus outbreak.

All in all, the Coronavirus outbreak is negatively disrupting the tech industry in three different ways. At first, it is negatively impacting the tech industry's productivity and income levels since many MNC'S have closed down their operations in China completely. Secondly, it is disrupting the global supply chain system with next to zero production in the manufacturing units. Finally, the Coronavirus has forced global tech companies to cancel or postpone their business events, promotional tours, and other related events. In this entire debacle, China has been the biggest sufferer with the country moving towards a recession like situation, with stocks dropping by 8 percent and GDP by 1.6 percent.

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