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Operators to Lose over $25bn in Roaming Revenue over the Next 9 Months, as Coronavirus Impacts Travel

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New analysis from Juniper Research has found the impact of Coronavirus on the international travel industry could cost netowrk operators over $25 billion in lost revenue during the next 9 months.

Juniper Research examined two possible scenarios: medium and high impact, believing a low impact is now not possible. The high impact scenario assumes severe disruption to international travel will continue for 9 months, with travel restrictions and reduced demand for international travel continuing. In this case, the resulting impact on operators’ international roaming revenue would be significant.

For further information, please watch our video discussion on the impact of Coronavirus on operators and download our free whitepaper: Coronavirus: The Impact on Mobile Roaming for Operators.

No End in Sight for Travel Issues

In the high impact scenario, Juniper Research believes over 650 million passenger trips will be cancelled due to Coronavirus over the next 9 months. This is over 80% of the anticipated international passenger trips that were previously forecast before the spread of the virus.

The research assumes that over half of all roaming revenue for the year will be affected, amounting to $25 billion in lost revenue. The research also highlighted the period between June and August as of particular significance when the demand for international travel is high. It forecast that operators could lose up to $12 billion in roaming revenue alone in these three months.

In terms of the overall impact on operators, it must be noted however that global roaming revenue only accounts for approximately 6% of total operator-billed revenue per year, limiting the hit on the industry.

No Mitigation Strategies

Given the nature of the international travel industry, the research anticipated there will be no strategies available to operators to mitigate this loss. It forecast that services, such as virtual conferencing, will offer businesses an alternative to international travel, but will offer no benefit to operators.

Additionally, the research highlighted that travel cancelled due to the spread of Coronavirus is unlikely to be rebooked. As a result, this loss of roaming revenue is unlikely to be recovered once the international travel industry resumes normal service.

Juniper Research provides research and analytical services to the global hi-tech communications sector, providing consultancy, analyst reports and industry commentary.