MWC Fallout, As New Smartphone Shortage Issue Emerges
The fallout from the cancellation of the world’s biggest mobile conference in Barcelona due to the coronavirus, is set to cost businesses including many in Australia hundreds of thousands of dollars with little chance of getting any insurance relief.
The cancellation of technology conference Mobile World Congress is “a nightmare” said one Company.
It’s also been revealed that retailers in Australia are now facing the real risk that there will be a major shortage of smartphones an issue that was set to be a hot topic at Mobile World Congress.
Analysts predict smartphone shipments within China will drop by around 40% in the first quarter as the coronavirus disrupts the country’s supply chain.
Numerous factories across China have suspended production as the country continues to cope with the outbreak.
The founder of Chinese tech giant Xiaomi one of the biggest in China claims that the country’s smartphone industry must return to work, or their will be major implications for the industry.
Lei Jun who is from the Hubei province where the virus originated, said yesterday at the launch of their new M10 smartphone that he was concerned for his home region where many components for smartphones are manufactured.
“I’m from Hubei and spent four years in Wuhan in college, so my feelings for Wuhan are quite deep,” said Lei, while donning a facemask at the launch of the company’s new flagship Mi 10 phone series.
Xiaomi was the world’s fourth-biggest smartphone maker in 2018, according to market research firm IDC – after Samsung, Apple and Huawei – and opened a second headquarters in Wuhan in December.
Mobile World Congress was set to be used by several big global brands to try and kickstart 5G which many industry executives including Peter Adderton the CEO of Boost Mobile say is struggling to gather momentum because “there is no killer app” said Adderton.
Organiser the GSMA said that meant it was “impossible” for the event to go ahead, adding it was a “dark day” in the history of the annual tech event.
Mobile analyst Ben Wood said many smaller firms could now be reconsidering whether to attend next year’s MWC because “they have had to swallow many of the costs from this year’s show”.
“The GSMA now needs to be careful that there is not a knock-on effect from this year’s cancellation. Major companies and many attendees will be reviewing the importance of MWC to their business and the GSMA must work hard to have a clear path forward,” he said.
And he pointed out the big tech players often hosted their own events – “set-piece launches where they can control the message away from the hustle and bustle of a tradeshow”.
Samsung did that this week in San Francisco for the launch of their new Galaxy S205G range of smartphones.
Overnight organisers of the event have been attempting to clarify why the show was cancelled amid speculation about the true reason.
“This is not about money – it’s about health and safety and the reputation of our show,” said Mats Granryd, director general of the GSMA.
Rumours had circulated that the organisers had wanted city officials to declare a health emergency in order to claim back expenses on insurance.
Mr Granryd described events as a “force majeure”, a legal term for unforeseeable circumstances.
“There is no way you can insure yourself out of a force majeure situation.”
According to its website, the GSMA takes out standard insurance cover on behalf of exhibitors, which does not cover the spread of communicable diseases unless health authorities issue travel restrictions.
The association’s chief executive, John Hoffman, promised the event would be back next year.
“It is a very dark day; it is very disappointing. But we know the sun will shine,” he said. “This is about our future together, and we look forward to hosting all of you, all of our partners from around the world, for MWC ’21.”