RAN market trajectory will continue downward, analyst firm says
The market for Radio Access Network (RAN) equipment is expected to remain a tough one this year, according to new figures from Dell’Oro Group.
Momentum for 5G build-outs in India has been a bright spot in a market that is otherwise in the midst of a network investment pause. But the Indian market is likely to slow this year as well, with several operators already saying that they have effectively completed their national build-outs.
“The big picture has not changed. [Mobile broadband, or MBB]-based investments are now slowing and the upside with new growth areas including FWA and private wireless is still too small to change the trajectory,” said Stefan Pongratz, VP at Dell’Oro Group.
The fact that so much midband spectrum capacity has been brought to market and speedily built out, may mean that operators can delay additional investments. Pongratz went on to say that part of what is weighing on the MBB infrastructure market is “the fact that the upper mid-band capacity boost is rather significant relative to current data traffic growth rates in some markets, which could impact the timing for capacity upgrades.”
“The Radio Access Network (RAN) market is now in a downward trajectory,” Dell’Oro concluded in a release. There was a greater than 40% increase in the RAN market between 2017-2021, a stabilization in 2022 and by the time the numbers for 2023 are said and done, the analyst firm expects a sharp decline for 2023. “Market conditions are expected to remain challenging in 2024 as the Indian RAN market pulls back, though the pace of the global decline this year and for the remainder of the forecast period should be more moderate,” the firm said.
In addition, Dell’Oro said, “5G-Advanced is expected to play an important role in the broader 5G journey, however, it is not expected to fuel another major capex growth cycle.”
Dell’Oro Group expects to see global RAN revenues decline at a 1% CAGR over the next five years, with the Asia-Pacific region seeing the strongest contraction. Which RAN segments are expected to see growth in the next five years, despite the overall market decline? Dell’Oro pegs those as 5G New Radio, Fixed Wireless Access, massive MIMO, Open RAN, virtualized RAN, private wireless and small cells.
