The widespread outbreak of coronavirus has affected each and every country around the world leaving a lot of sectors paralized. When the world is in a state of lockdown, the software industry has some advantages and disadvantages in this situation.
As a result of the current situation, many top IT and software companies have lowered their revenue forecast for the quarter and year. Small and big industries including industry leaders like Google, Facebook and Apple are affected due to reduced advertising and technology spends by clients.
Market analysis and research firm IDC has also projected that the overall revenue of the global IT industry will see a decline of 3% to 4% due to the outbreak of the virus. As the impact of coronavirus on the software industry will be both positive and negative, let us discuss it in detail.
Positive impact of coronavirus on Software industry
Increase in Demand
Widespread outbreak of coronavirus has led to the closure of many brick and mortar businesses. As a result, such businesses are looking to collaborate with IT companies to bring their work online. Thus, the demand for software companies in this field will see an increase due to coronavirus. Also the increasing use of technology will increase the demand of tech companies in the coming future.
Proper working through “Work from Home”
There are mixed reviews when it comes to working from home. For some it is a boon, but at the same time for others, a bane. As most of the work of the software industry is online; the work has not been impacted much. Almost all companies have given “Work from home” to their employees and they are completing their work as usual. So, the working cycle of the software industries are running while developers are getting more time with family.
Video and Teleconferencing
As coronavirus has led to the cancellation of major tech conferences; companies are approaching software companies to arrange video conferences for them. They are trying to collaborate with software companies to make a video conferencing network for them so that they can arrange online conferences, meetings, etc. along with employee productivity tracking tools.
The increasing need for remote interactions among the pandemic has emphasized the need for 5G technology, which will accelerate the adoption of work from home in the long run.
Negative impact of coronavirus on Software industry
Global travel restrictions have led to delay in execution of ongoing projects. All those projects which require travel have come to standstill. This will in return result in a delay in the release of funds for the companies and is likely to boost pricing pressures in future.
Disruption of the Supply Chain
The state of lockdown has resulted in the disruption of product supply. IT companies which export (and import) products are facing difficulty due to this break in the supply chain.
Cancellation of contracts/deals
Along with the delay in projects, coronavirus has also led to cancellation of many contracts and deals. Many clients have canceled the projects that were to start soon due to the impact on their primary business. There is a possibility that the projects may never see the light of day.
Fear of Recession
All the above mentioned impacts of coronavirus on industries are pointing towards recession. As many projects are delayed, many are cancelled, companies are facing losses due to a break in the supply chain.
The economy is depleting and industries of different sectors are losing clients and projects. This has led companies to reduce employee costs. As a result, millions have lost their jobs if the current scenario continues then the world is sure to head into recession.
Future Prospects after the Outbreak
The impact of coronavirus on the Software industry has had an impact on markets but it has also opened doors of opportunity to the tech industry.
Many apps are being developed to help take businesses and services online. AI and Chatbots are also used to provide better customer service, speed up medical research, provide pandemic intelligence and a huge gamut of software services that Clavis Technologies is at the forefront to provide.