An argument I have frequently heard, from professionals in the telecom industry, is how the Covid-19 pandemic “must” be good for service provider revenues, since so many people were forced to work from home, and therefore were using more telecommunications.
The reality is that revenues are down, as you would otherwise expect in a situation where whole economies are nearly shut down. The functional result is a recession, and recessions cause lower service provider revenue.
Also, lockdowns keeping people at home hit roaming revenue, and given that mobile services generate a clear majority of global service provider revenue, that has hit both revenue and earnings.
Add to that bankruptcies of significant numbers of small businesses and organizations, and aggregate demand is reduced.
All of that happens within the context of a global business experiencing slow to no growth.
The point is that even professionals who work in the industry can have distorted views of what is happening in the business, especially the impact of the pandemic and economic lockdowns.
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