More than 50% of the global research and development of fibre optics and fibre optic cables is located in Wuhan, China, the area from which the Covid-19 pandemic. Considering that most of the suppliers of key components for 5G base stations are based in Hubei province (whose capital is Wuhan), the impact of the pandemic on the optical communications industry in the first half of 2020 is likely to have serious repercussions on infrastructure development and the launch of 5G services.
Communication companies such as Fiberhome, Yofc e Htgd are engaged in a proactive effort to resume operations and production. However, transportation and logistics remain key aspects of optical communications equipment manufacturing, and the industry is suffering from significantly reduced logistics capacity, which is compromising shipments. If the pandemic is not contained in the second quarter of the year, the establishment of global 5G network and data centre infrastructure will be severely hampered. Among the expected effects is a deferment in the construction of 5G infrastructure and a consequent contraction in demand for smartphone replacement.
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