Spain Telecoms market in the COVID-19 era

pic: Tania Fernandez @tania_fernandez

It is no longer a secret that the COVID-19 pandemic has triggered a crisis worldwide. But as Einstein said, “creativity is born from anguish, just like the day is born form the dark night“.

This statement has been particularly true for telecommunications in Spain: although the country already had a powerful fibre optic network and a solid telecommunications infrastructure, the pandemic has become a source of development opportunities for this sector.

Spain in Europe: a leader in telecommunications

Spanish network has proved capable of remaining fully operational, even in exceptional situations such as the current pandemic. This is due to the foresight of the four major telecommunications operators that provide service to the country.

In Spain there is currently more optical fiber deployed than in Germany, France, United Kingdom and Italy combined, so it is not surprising that Spanish telecommunications have managed to cope with the increased demand that has arisen due to the confinement imposed by the COVID-19.

It is worth noting that Spain has 4G mobile coverage in 100% of homes and fibre coverage in 77% of its territory. This fact, together with the fact that the pandemic has accelerated the implementation of new technologies such as 5G or 400G/800G for optical fibre nodes, means that Spain is leading Europe in the field of Telecommunications.

This will undoubtedly provide the country with a great competitive advantage to face the digital transformation that the pandemic is imposing on the global economy.

Pandemic and economy: the digital advantage

The better telecommunications, the bigger opportunities. COVID-19 has created a new working scenario that relies on the telecommunications sector.

Teleworking, online shopping and distance learning have gone from being mere options to becoming the only serious alternatives for keeping society working despite the pandemic.

The IMF predicts a 3% decline in world’s GDP in 2020, which in Spain could fall to 8% due to the depression in sectors such as tourism. But the Spanish telecommunications shows a very different perspective.

In addition to the increase in demand for connectivity, other areas have also benefited. Such is the case of cybersecurity services as each remote work station is now a vulnerable point for companies. Another boom sector is video on demand platforms, with Netflix leading the way, not to mention the increase in online game subscriptions.

Negative impacts of the pandemic and future challenges

It is also true that COVID-19 has slowed down the development of telecommunications in some respects. These include the physical deployment of the new 5G towers which will affect sales of terminals with the ability to use this technology. However, it has also imposed a truce between operators to achieve an improvement in their network traffic management.

Future opportunities include major advances in the area of telemedicine, online education, corporate transactions and online leisure services.

The coronavirus pandemic has endorsed the digital transformation of society. After so many positive advances, this change is now imminent and irreversible.

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