Coronavirus threatens the next generation of smartphones

BBC Technology 02 Apr 2020 11:06
By Sooraj Shah Technology of Business reporter
Mazen Kourouche, Apple Store in Sydney in 2018, with iPhone XSImage copyright Mazen Kourouche

Every Autumn, Mazen Kourouche heads to the biggest Apple Store in Sydney, Australia, and queues up for hours to be one of the first people in the world to get his hands on the latest iPhone.

"Since the iPhone 7 came out I've been lining up for the new Apple devices for a few reasons: firstly the hype associated with them, secondly because of the resale value, and thirdly because Australia is the first country to get access to the devices, so people are interested in hearing about it," he says.

According to Mr Kourouche, who develops software for the iPhone operating system (iOS), many people would usually travel from overseas to get their hands on the iPhone in Australia. The nation's time zone means its Apple stores are the first to open around the world on launch day.

This year could be different though. Like most other retailers, Apple has closed its shops around the world in response to the coronavirus outbreak.

Image copyright Getty Images

Sources have told the Japanese publication Nikkei that Apple is weighing up whether to delay that launch.

Production of phones has already been disrupted,

Many smartphone makers rely on components that are made in China and South Korea, two nations that have been hardest hit by the outbreak.

And it's not just supply, demand has fallen dramatically. Shipments of smartphones in China tumbled by 40% in the first quarter of 2020, compared with the same period last year, according to research firm IDC.

"We're likely to see significant drops in Western Europe and the US as well," Gaurav adds.

The effect on existing devices will be a worry for device manufacturers, but it will be the impact on their new devices which will be of greater concern, particularly as fans of Apple and Android devices are accustomed to specific times of the year when they can buy a new device, while manufacturers rely on this as one of the biggest revenue streams every year.

Different parts of the production process will be affected in different ways.

But there may be some research and development work which requires specialised equipment that employees can't take home.

Image copyright Getty Images

"Testing may be hard as the industry is very tight on security and they would probably struggle with the concept of people taking home prototypes of the phone to test - as these are usually shrouded in secret," he says.

The effects of this and the China factory shutdowns are only now starting to ripple down into the smartphone industry, and the impact could be bigger than expected.

Much obviously depends on what happens in the coming months. Restrictions on delivery and shipping might force firms to delay product launches, and possibly launches may even be held back until 2021.

"We know that the first weeks and months of these new devices' sales life are very important because they're sold at the highest levels," says Mr Naus.

Image copyright Getty Images

Prices may not come down - but if the demand is not there, then perhaps new strategies could be put into place.

However, Apple's biggest fans are likely to remain loyal.

Continue reading original article...


AppleMazen KouroucheMr KouroucheChinaAustralia
You may also like