In particular, Verizon (NYSE: VZ) managed to buck the trend and is currently on track to become the world’s “most valuable” telecoms brand.
David Haigh, CEO of Brand Finance, said: “A call to the help desk may be in order for the telecoms industry, as most telcos saw their brand value decline this year, Over the past year, we’ve seen the combined value of the world’s top telecoms brands decline by 11% to a combined value of $692 billion, compared to $777 billion in 2019 – while all other major sectors recorded significant increases.”
US-based multinational Verizon - CEO Hans Vestberg pictured - was trading at US$53.73 per share as of 31 March, despite a one-year decline of 9.13%. Revenue stands at $131.87 billion and net income $19.27 billion, yet Brand Finance calculated a brand value of $63.7 billion, ahead of rival AT&T, at $59.1 billion.
“Verizon is commended for its overall performance, network reliability, network speed, data performance, call and text performance, while AT&T is the fastest falling and now the second most valuable telecoms brand in the world,” according to Brand Finance.
The analysis continued: “AT&T finds itself inching down to second rank for the first time in nearly a decade and loses its leadership on the telco top 150, overtaken by Verizon. The brand diversified its entertainment portfolio over the last few years, culminating with the acquisition of WarnerMedia, as part of a plan to move away from relying on the traditional telco business and paid TV, as both revenue streams have been drying up over the last years.”
Verizon and AT&T are followed by China Mobile, T Mobile, NTT Group, Xfinity, China Telecom, Spectrum, Vodafone and Orange.
In analysing the data, Brand Finance compared the “business value” of major companies on 18 March to 1 January, using this to estimate the likely impact on “brand value” for each sector. The sectors were classified into three categories based on the severity of business value loss observed for the sector.
Haigh said: "The telecoms sector can be seen as much more resilient in the face of COVID-19, while it experiences a faster revolution in data handling as a result of the remote working revolution we are seeing all around the world. Telecoms brands are in essence already being pressure tested, having seen an immediate spike in demand and now is the time to engage with customers and promote their offerings during this crisis.”
Despite the positive news for Verizon, the wider trend signals that the world’s “biggest companies” could lose US$1 trillion in brand value due to the Covid-19 outbreak.
Haigh said: “The COVID-19 pandemic is now a major global health threat and its impact on global markets is very real. Worldwide, brands across every sector need to brace themselves for the Coronavirus to massively affect their business activities, supply chain and revenues in a way that eclipses the 2003 SARS outbreak. The effects will be felt well into 2021.”
