Analysis of Novel Coronavirus Epidemic Impact on Optical Communication Industry -- Controllable Short-term Impact of The Epidemic and Promising Medium and Long-term Development Opportunities
2019 novel coronavirus (2019-nCov) has been spreading rapidly in China since the end of 2019. The WHO emergency committee held a meeting in January 30th to announce that the new crown virus epidemic constitutes a public health emergency (PHEIC) with international concern. Novel coronavirus control has been taken to control the expansion of the new coronavirus, including the suspension of part of the transport, Changchun Spring Festival holiday and medical isolation control. The further development of the epidemic situation and related prevention and control measures have a potential impact on the R & D and manufacturing of optical communication industry in China.
For the impact of shutdown, shutdown and medical control on the production of enterprises in the optical communication industry, through the enterprise announcement information and investigation and communication, we believe that if the epidemic can be effectively controlled before April, the market is still expected to be better in the whole year, the short-term impact is controllable, and the industry impact is expected to be eliminated in the next few quarters.
2020 is the first year of China's 5g scale deployment, and the three major operators have successively launched the 5g optical transmission equipment bidding. Among them, the total bidding amount of optical transmission equipment procurement announced by China Mobile is about 20 billion yuan. Facing the impact of economic downward pressure and new epidemic situation, it is expected that 5g investment may further increase in 2020.
In 2020, North American data center will show a strong trend of investment recovery, and capital expenditure will start to show a substantial growth after six quarters of stagnation. Amazon, Microsoft, Google and other companies' data center optical module demand will directly drive the rapid growth of optical device market. China's data center market will enter a recovery period of capital expenditure as 5g construction approaches.
With the market of optical communication expected to be better in the whole year, the short-term production capacity impact of the epidemic is expected to be eliminated in the following quarters.