The COVID-19 pandemic has had a lasting impact on countries around the world. Even with the successful vaccination roll-out, regions are still moving in and out of lockdowns. As you’d expect, containment measures have caused a substantial drop in business activity across Europe, especially in contact-intensive sectors.
Economic growth is expected to pick up throughout 2021 as vaccines become more widely distributed. However, communication service providers have seen a significant surge in demand because of the pandemic. Overnight they saw demand spike as organisations moved to a distributed workforce.
With many businesses now committing to a more hybrid working model, communication service providers will continue to experience high demand for the foreseeable future. This presents a unique set of challenges.
To understand the true scale of demand and examine how COVID-19 has impacted communication service providers, A10 Networks conducted research that analyses the challenges and issues that senior IT professionals in communication service providers face and how they are adapting to a post-pandemic world. Over 1,200 senior professionals took part in the research from five different countries. It covered seven different vertical market sectors: financial services, education, healthcare, government, ecommerce and retail, utilities, and gaming.
As we examined the responses across these different vertical markets, this is what we found.
Gaming, retail and ecommerce see significant spikes in demand for data and network bandwidth
Without a doubt, COVID-19 had a significant impact. Almost universally (99%) of the 1,200+ respondents experienced an increase in demand for data and network bandwidth from their customers and subscribers. This was clearly due to the rapid switch to remote working and the continued lockdowns across countries and regions. These have continued throughout the first half of 2021.
Interestingly, communication service providers with gaming customers witnessed the highest increase in demand. It was perhaps as citizens found themselves with more time on their hands working from home or furloughed. This was followed by government sector respondents and then ecommerce and retail. To this point, gaming, ecommerce and retail saw significant spikes in the increase in demand for data and network bandwidth in the over 75% and up to 100% category with 13% and 11.5%, respectively.
As you can imagine, this increase in demand has affected communication service providers in several ways. The top-three consequences of the surge were:
- more than half stated that they had to scale up infrastructure across their entire network
- half again had to scale up in specific high-demand locations
- just under half invested more heavily in security technologies.
Education sector customers have witnessed unprecedented demand as a result of homeschooling
The rapid surge in demand due to COVID-19 meant that communication service providers had to quickly expand their capabilities. As organisations have moved to a remote setup, the attack surface has also expanded and intensified. It meant that respondents had to invest heavily in security technologies to protect their networks. Likewise, demand has come from multiple different locations. Previously customers/subscribers were more likely to be in offices together. Now, workforces are geographically dispersed, creating broader and heavier spikes in multiple locations.
Here, we found that respondents with customers in the education sector were the most likely have to scale up their infrastructure to meet specific high-demand locations, as schools closed and children moved to home learning.
We asked whether COVID-19 had accelerated network transition to a more distributed network (edge). We also asked how much of the total network traffic this impacted. Interestingly, respondents serving the healthcare and utilities sector witnessed above-average acceleration: 66% and 67%, respectively, in the “by over 25-50%” category. Respondents serving the gaming sector were highest (38%) in the “by over 50-75%” category.
Healthcare invests in security technologies
The increase in traffic has significantly changed capital investment plans for communication service providers in multiple ways. More than half of the respondents plan to increase their investment in security. No doubt this is due to the escalating attacks witnessed on organizations with remote workforces.
Providers serving the healthcare sector were most likely to be investing in security. However, communication service providers with customers in the government and education sectors were pausing investment plans.
Changing customer relationships and requirements
How has this changed relationships with customers? Over half of communication service providers have seen an increase in demand for online platforms such as customer service portals from their customers. Interestingly, half of the respondents claimed that customers are more concerned about business continuity and resilience than before the pandemic. 44% said that customers have increased their expectations around security from network service providers.
Unsurprisingly, respondents serving the financial services sector were most likely to say their customers have concerns around security, with more than half stating this was the case.
Gaming sector foresees a hybrid workforce
Most respondents surveyed don’t think the work environment will snap back to how it was before the COVID-19 pandemic. More than two-thirds (67%) believe their customers will continue to operate with employees working from home in some form. Therefore, a significant proportion believes that many of their customers will reorganise their working practices. It means that remote working will become a permanent feature.
Respondents serving the financial services market were most likely to think that the work environment would snap back to how it was before, with 40% believing this to be the case. Interestingly, those respondents servicing the gaming industry thought that this sector was most likely to see a hybrid approach to work. Three-quarters (75%) stated this would be the case. It was followed by respondents serving the government sector, where 71% thought the same.
Cybersecurity training programmes are a priority for education and healthcare
What about the security challenges enterprise customers/subscribers are facing? Education (62%) and healthcare (61%) said that their customers need to revise their employee cybersecurity training programmes. The financial services sector ranked highest in terms of ensuring that BYOD policies were more robust. Additionally, when we asked about the highest priority security investments for 2021-2022, ecommerce and retail (51.5%) were the most focused on upgrading firewalls and other security appliances.
When it comes to 5G, just under one-third of respondents stated that maintaining a quality service and avoiding service outages were top security challenges. For ecommerce and retail respondents, ensuring uptime is critical. 35% said that maintaining a quality service and avoiding service outages were key challenges. These were also top security challenges for utility companies. Over a quarter of gaming companies saw the unpredictable subscriber usage and the changing patterns on the network as their top security challenges as 5G becomes more widely available.
Altogether, the impact of COVID-19 on communication service providers has been enormous. Although there have been variations across different vertical sectors, there is a general recognition that resilience and security must be priorities as businesses adjust to a future of hybrid work environments.
A10 Networks (NYSE: ATEN) provides Reliable Security Always™, with a range of high-performance application networking solutions that help organisations ensure that their data center applications and networks remain highly available, accelerated and secure. Founded in 2004, A10 Networks is based in San Jose, Calif., and serves customers globally with offices worldwide.
