Coronavirus vs. PS5 and Xbox Series X – Impact of 2019-nCoV on the Industry
The coronavirus has affected over 45,000 people so far. At this point, we can talk about an outbreak that has direct effect on the economy, as corporations are also affected by it. How serious is the threat for the next-gen?
UPDATE: Unfortunately, another industry event has been cancelled: the GSMA, who organize the MWC in Barcelona, decided to call the event off. This is yet another conference hindered by the coronavirus. You can read more about the details of this announcement in our news.
Coronavirus has been on everyone's lips in recent weeks. And for a good reason. We're in the middle of an international outbreak of the SARS-CoV-2, or the Wuhan Coronavirus. According to WHO, however, if you're not an older person, and you have no pre-existing medical conditions, your life generally isn't at serious risk. As I'm writing this, an international of experts convenes in Geneva to figure out a way to prevent a more serious episode, like a pandemic. The largest number of confirmed diseases were reported in Asia (mainly China), but infections have already spread to US, Europe, and Australia. The Novel Coronavirus has directly affected lives of dozens of thousands of people around the world, and so it's effects also reverberated in the tech industry almost directly after the outbreak was announced.
Events and fairs
It's common knowledge that most of the industry and manufacturing is based in Asia. Sony, Samsung, LG, Xiaomi, Nintendo, and many, many others are all Asian corporations. And even if a particular company doesn't have Asian pedigree, it certainly manufactures its hardware in this part of the globe – like Apple, HP, or Dell. All those companies regularly rub shoulders on industry events. However, due to the outbreak, many of these are either strictly reduced, or completely cancelled.
Taipei Game Show 2020 – cancelled
One of the canceled events is the Taipei Game Show. From our perspective, it's not as exciting an event as gamescom or the E3, but Taiwan is one of the centers of modern big tech corporations, and the TGS is the biggest event of the kind in Asia. Even more significant for us is the fact that in Taipei, we were supposed to see new chunks of gameplay from Cyberpunk 2077. Yeah... this isn't happening.
Initially, the organizers planned to introduce numerous restrictions to maximize the safety of the participants. For example, the temperature of each person entering was supposed to be checked by specialized machines. Protective masks were supposed to be mandatory. But yeah... it's not happening. The organizers had to cancel the event completely.
For the time being, Taipei Game Show 2020 is postponed until the summer, but the exact date is still unknown. Whether it will happen or not is impossible to predict now.
Mobile World Congress 2020 – limited access
Anyone who is at least remotely interested in the mobile industry knows that every year, it's largest event is held in Barcelona – the Mobile World Congress. Tech companies from all over the world flock to the Catalan capital. This is where cutting-edge prototypes and flagship hardware is most often revealed. Barcelona was the place of choice for companies such as Samsung, where they revealed their Galaxy Fold. Not this year.
ittedly, Mobile World Congress 2020 was not canceled, but the largest companies in the mobile industry and beyond have withdrawn. Sony, Amazon, Nvidia, LG, ZTE, Intel, and Vivio – none of these companies will show up. We can also conclude from the Facebook posts of our colleagues that a significant number of journalists, for whom the MWC was a permanent element in the calendar, are not going to Catalonia either. I'm not surprised.
MWC 2020 has not been canceled, and it's likely to take place. For now, the organizer introduced restrictions for all participants. People from Hubei province, of which Wuhan is the capital, will not be allowed to attend the event. Anyone who travelled to China will have to prove that it happened at least 14 days prior to the event . Temperature measuring devices were also introduced, the number of medical staff was doubled, and disinfectants were placed in key locations. A special hotline will also be available all the time. Is this enough? Time will tell.
Will the coronavirus delay the launch of PS5 and Xbox Series X?
Let's get this straight – cancelling TGS or MWC barely has any effect on anyone outside the industry. But there are events and releases planned, which we, as gaming freaks, are anxiously looking forward to attending. Meanwhile, first rumors were already spread, saying that the outbreak will have a negative impact on these. Of course, we are talking about the release of next-generation consoles. Both PlayStation 5 and Xbox Series X are expected to debut sometime in late November / early December 2020. If Sony and Microsoft decide to significantly postpone the launch of next-gen, many players will shed a tear.
How is it possible that the launch of the PS5 and Xbox Series X could be delayed due to a virus? Well that's kind of obvious – Asia is the epicenter of the outbreak, so any exacerbation of the epidemic will have increasingly far-reaching effect. Next-gen consoles, just like most of the electronics we use, are manufactured in China, Taiwan, and others. Closing factories, or even quarantining entire cities should affect the production capacity of factories located there. If workers from a particular factory start getting sick, then we have a problem. But then – if it comes to this we might have more important things to worry about than playing games. . .
No reason to panic
Experts reassure players that there is no reason to panic. In their opinion, the launch of PS5 and Xbox Series X will start becoming threatened if the outbreak lasts at least until June this year. Michael Pachter from Equity Research notes that while the coronavirus is already impacting the mobile industry, the smartphone and tablet sector is very different from gaming consoles. First of all, if we look at Apple, they're strongly tied to Chinese Foxconn. Sony and Microsoft, on the other hand, aren't so closely linked to specific countries that manufacture goods. This provides them with more flexibility in selecting the location of the factories that will produce the consoles – the schedule wouldn't be compromised, but the price could change.
We also have to keep in mind the launch date and the demand. iPhones always debut in September. Next-generation consoles will launch in November or December, which could make a huge difference in context of the coronavirus outbreak. Experts predict that production of PS5 and Xbox Series X will begin in June. It's more than likely that by that time, the virus will already be largely under control. In addition, the volume is also a lot different – in case of consoles, we're talking around 1 million units a month. Meanwhile, Apple has to manufacture up to 3-4 million smartphones in 30 days, and hence the production has start much earlier. This is why Sony and Microsoft are in a relatively comfortable position, despite the risks. This is probably why both companies have not yet commented on the case and are waiting for development.
Still, minor delays and slips in the schedule should definitely be taken into for as long as the virus is beyond control. Again, this is no reason to panic, just something to keep in mind. Everything depends on the development of the epidemic. If WHO and world governments manage to contain the situation, things should go as planned. You have to that currently, coronavirus' lethality is around 2%. For more than 43 thousand infected people there has been around 1 thousand deaths. The situation is serious, but this isn't exactly an end-of-the-world scenario. On top of that, we have more than 4 thousand people have already completely recovered. Of course, provided that the data is reliable.
Unfortunately, the list of companies, events, businesses, industries, or even individual games that have been or may be affected by the coronavirus is not exhausted yet. In the coming weeks, and possibly even months, we're bound to get more news of delays caused by the international situation. Apple is already talking about significant problems with the launch of new iPhones. The Outer Worlds debut for the Nintendo Switch was delayed for a later date. The introduction of 5G technology will be delayed in China itself. This may of course be the tip of the iceberg that the industry and big tech might, but don't necessarily have to crush into.
In all that, you have to that a lot depends on people: doctors, specialists, and regular folk like us. When it comes to epidemics, there's a huge responsibility resting on every single individual out there – humans are the weak link in this chain. So to sneeze and cough into your elbow, and wash your hands with soap often. Some of you probably the spread of the virus in World of Warcraft. This was an ideal opportunity for scientists to analyze human behavior in the face of a deadly epidemic, and although everything happened in a virtual world, I'm afraid we failed that test miserably.
