Chinese vendors Huawei and ZTE account for nearly half of the global RAN market, according to Dell’Oro
The global radio access network (RAN) market conditions remained challenging in the second quarter of the year, with global RAN revenues declining at a double-digit rate year-over-year for a fourth consecutive quarter, according to a recent report by Dell’Oro Group.
“Even if the RAN market is still down at a double-digit rate in the first half, the second quarter offered some glimmer of hope that the nadir of this cycle with double-digit declines might now be in the past for the time being,” said Stefan Pongratz, vice president and analyst at the Dell’Oro Group. “This does not change the fact that the RAN market is expected to decline at a 2% compound annual growth (CAGR) over the next five years. But the pace of the decline should moderate somewhat going forward,” said Pongratz.
The report also highlighted that strong growth in North America and stable trends in China were not enough to offset steep declines in the Asia Pacific region, partly driven by sharp drops in India.
Dell’Oro also noted that at the end of the second quarter, the top five RAN suppliers based on worldwide revenues were Huawei, Ericsson, Nokia, ZTE and Samsung. The report added that the two Chinese vendors had nearly half of the global RAN market as of the end of June.
When compared to 2023, Huawei’s H1 2024 revenue share is up, ZTE is stable while Nokia and Ericsson are down 3 to 4 percentage points, according to the report.
The firm also noted that the global RAN is expected to decline 8-12% outside of China.
A recent report by Dell’Oro Group stated that the global RAN market is forecast to decline at a compound annual rate of 2% during the 2024-2028 period as continued 5G investments will be offset by rapidly declining LTE revenues.
The report pointed out that this expected decline follows the 40-50% increase in the RAN market between 2017 and 2021.
However, Dell’Oro noted that despite the challenging scenario for the RAN market, the pace of the decline should moderate somewhat after 2024.
The Asia Pacific region is expected to lead the decline during the forecast period, while North American RAN revenues are expected to remain significantly lower than their peak in 2022.
According to Dell’Oro, 5G-Advanced technology will play an essential role in the broader 5G journey. However, 5G-Advanced is not expected to fuel another major capex cycle. Instead, operators will gradually transition their spending from 5G towards 5G-Advanced within their confined capex budgets, the research firm found.
Also, the report noted that the RAN segments that are expected to grow over the next five years include 5G New Radio, Fixed Wireless Access, millimter wave, Open RAN, vRAN, private wireless and small cells.
A previous forecast by Dell’Oro Group reported that the global mobile core network (MCN) market is expected to decline by 10% during the 2024-2028 period.
The reduction in the forecast is caused by severe economic headwinds, primarily the high inflation rates, and the slow adoption of 5G Standalone (5G SA) networks by mobile network operators (MNOs), according to Dell’Oro.
