By Bernd Debusmann Jr
Global markets have taken a chilling hit amid the coronavirus epidemic, but some sectors are bringing in the dough
Stock markets are plummeting, oil prices are plunging, travel is being restricted, events are being scrapped, millions are placed under quarantine – it’s hard not to be concerned over the impact of the chilling coronavirus epidemic.
Just don’t tell that to Gail Clough, co-founder of the Laughter Factory, the Middle East’s longest-running comedy night.
“We’re so up! Like 30 percent,” she tells Arabian Business. “We were sold out…I probably turned away more people than I let in.”
The long-standing and undisputed matriarch of the Dubai comedy scene is among those who have managed to find a silver lining amid the doom and gloom of the coronavirus epidemic.
From comedy clubs, streaming platforms and home delivery services, to cyber security firms, video-telecommunications specialists and e-commerce retailers, some companies have managed to emerge from the chaos of the outbreak with swelling customer bases, growing brand recognition and – perhaps – promising financials down the line.
In Clough’s case, the coronavirus-related spike in attendance stands to reason: in tough times, many Dubai residents are simply “in need of a laugh”. Despite the cancellation of one of her shows in Abu Dhabi, Clough says crowds at Laughter Factory events in Dubai have remained packed, with no decline from the evening’s average nightly crowd of 175 people.
“We’re smashing the numbers with this,” she says. “Dubai’s going strong. Takes more than a bit of snot to come between us and a night out.”
Growing attendance figures are a standard fixture of Dubai’s comedy goers as many hope to escape the flood of alarming news in bad times. Clough can attest to that, having made so much money in the 2008 crash that she was able to purchase the car of her dreams.
“[In such times] people just need cheering up. It’s a certain type of person that comes to live stand-up,” she explains. “They tend to be quite free-spirited and these sorts of things bring them out of the woodwork. The most money that we ever made was in the 2008 crash. I bought a Jaguar then!”
But the coronavirus is no laughing matter for businesses being targeted by a rash of cyberattacks using the outbreak as convenient “bait,” according to cybersecurity firm Kaspersky, which has had to come to the aid of companies.
Researchers say they have already detected thousands of fraud attempts, including fake emails purportedly sent from the World Health Organisation (WHO) to redirect unwitting users to sites which prompt them for personal information that winds up in the hands of criminals.
“Threat actors take advantage of these kinds of events to try embed their malicious content, [such as] phishing campaigns or even spam emails. They can lure unaware users into clicking a link, or opening a file,” remarks Kaspersky’s META head of presales, Emad Haffar.
While an uptick in cyberattacks is expected during major news events or even holiday periods, the coronavirus epidemic presents a unique challenge for businesses, according to Haffar.
“It’s a global event. Every single person on planet earth is interested in at least reading about the coronavirus, how to protect themselves, the latest news and so forth. Half of the social engineering effort [cybercriminals] need to put in is already done,” he says.
Although Haffar believes it’s too early to predict the financial impact the coronavirus will have on Kaspersky’s bottom line in the region, he says the company has already seen a significant increase in demand for its security products and advisory services, particularly from firms that have asked employees to work from home or are planning to do so in the event the situation deteriorates.
“We’ve received a spike in requests, not necessarily just to counter the coronavirus related scam emails, but mostly to provide advisory services and help them cope with that demand,” he says. “Judging from what we’ve seen, probably this will [in the mid- to long-term] increase demand for cyber security and the appetite of organisations to invest in it.”
Some of the same concerns that are helping boost interest in cyber security are also driving demand for companies that specialise in teleconferencing or web-based collaboration and productivity tools that allow employees to work together, even when out of office.
Among them is Chennai-based Zoho, which provides cloud-based business solutions and announced recently that it will offer a remote work toolkit – known as Zoho Remotely – free for all at least through in July 1. The package includes 10 Zoho applications that can be used for virtual meetings and conferences, as well as shared access to files and documents.
“Not everyone wants, or can, afford to pay in this situation. It’s probably not the best time to pay for software,” explains Ali Shabdar, Zoho’s Middle East and Africa regional director. “At whatever point we stop the free service, we will invite them [customers] to use the paid plan.”
Going forward, Shabdar says a by-product of the virus outbreak is that many organisations in the region and the world are “reconsidering” their traditional ways of doing business. “We became too comfortable with the way we do business,” he explains.
“The tools have been there for more than a decade, but not everyone utilised them to the fullest. It’s time for everybody to regroup and quickly start learning how to use it…..now it’s not a luxury, it’s a need.”
Shabdar’s thoughts are echoed by Savio Tovar Dias, senior director for sales engineering for American multinational tech firm Avaya International, who says the coronavirus has led customers to explore new ways of implementing technologies they may have been previously hesitant to use.
“Customers have always thought about it, but adoption rates have been low. We’re going to see adoption and usage increase. We’re seeing a significant advancement in remote working and the value of doing that,” he explains. “We’re seeing a large uptick.”
Ihsan Anabtawi, chief operating and marketing officer at Microsoft UAE, which is providing its Microsoft Teams platform free for customers who don’t have commercial licenses and is working with the UAE Ministry of Education to help establish remote learning classrooms – says demand for remote working platforms is likely to remain long after the end of the epidemic.
“People will end up realising that having remote work enabled in place is useful in any scenario. If something like this happens, you’ll be ready. It allows flexibility,” he says.
“Once things normalise, you’ll see people continue with a hybrid set-up. They can work from the office, but if the need arises, without necessarily an emergency or a medical situation, then they’ll have the tools they need to work remotely and remain connected.”
The same video-conferencing technology that is making it easier to work from home is now increasingly becoming a key part of the health sector currently being tested by the coronavirus epidemic.
“Primary care, when delivered over telehealth channels, offers the opportunity to navigate patients to the correct care need, thereby reducing unnecessary visits, tests, medications and the associated costs,” says David Healy, EMEA CEO for US insurance giant Aetna International. “This is particularly relevant in the current climate where Covid-19 concerns can put a lot of people off visiting hospital waiting rooms. These telehealth services are a safe and secure way to talk to an experienced doctor, without the risk of catching or spreading infection.”
Aetna agrees it is too early to judge the eventual financial impact of the virus, although it has seen a spike in coronavirus-related inquiries from members.
“I believe everybody’s attention now is on protecting their employees and members,” Healy adds. “While it may be too soon to assess any business impact or forecast, we are monitoring the current international and domestic environment for Covid-19 related risks and are preparing accordingly.”
Other companies have taken the opportunity presented by the epidemic to diversify their portfolio – even if they don’t necessarily intend to make a profit. Regal Global Trading, for example, has announced plans to set up a factory in Dubai to manufacture affordable face masks and medical kits to be shipped to virus-stricken countries all over the world, particularly China.
“Everyone in China needs masks. They did not go and try to set up surgical mask factories [prior to the outbreak], because there is very little income in that. They went for more value-added products. They don’t have the capacity, even if they’re the largest producer of non-woven cloth,” explains Khurram Shroff, chairman of IBC Group, which backs Regal.
“It’s a fiasco everywhere in the world, and people are starting to gouge prices.”
Shroff is quick to point out that he’s unlikely to make a profit from the project. Because of price increases caused by staggeringly high demand amid the outbreak, the necessary equipment – which would usually be available for $80,000 – now costs $500,000. The entire facility, he adds, would have cost about $150,000 to set up in normal times. In the coming weeks it is being set up for approximately $1m and will eventually ramp production up to 600,000 masks each day.
“The world has changed, and now everyone will talk about wearing masks in public areas for protection. We feel that the demand will stay there,” Shroff says of the facility’s future. “But, for now, everyone else [producing masks], is making money. We just want to figure out how to effect a big change.”
Given the uncertainty that swirls around the coronavirus epidemic – and the frightening financial hit to global economies – the size and extent of the outbreak’s impact remains largely unclear. But for some companies, it seems that every cloud has a silver lining.
While Netflix has declined to answer queries from Arabian Business on the impact of coronavirus on its business, some analysts around the world are predicting that the company will see a significant boost as a result.
Analyst Michael Olson of Piper Sandler, for example, analysed search trends for Netflix on Google and believes that the company’s subscribers from the US and Canada alone could grow by as much as 3.8 percent year-on-year – more than twice that previously forecast. The data also suggests that international subscribers may grow 30.9 percent compared to the same quarter last year, above expectations for growth of 29.9 percent.
“With coronavirus fears pushing consumers away from travel and out-of-home entertainment, Netflix could be a near-term beneficiary of this temporarily altered behaviour.”For all the latest Politics & Economics news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.