5G network infrastructure spend to almost double this year


By Amy Sarcevic
Thursday, 30 July, 2020

5G network infrastructure spend to almost double this year

Investments into 5G network infrastructure will almost double to $8.1 billion this year, according to the latest forecast by Gartner. The growth contrasts with an overall decline of 4.4% for the total wireless infrastructure market, which is expected to drop to $38.1 billion in the same period.

The bulk of investment will come from communications service providers (CSPs), with 21.3% of total wireless infrastructure revenue spent on 5G network infrastructure by this segment. This is a considerable rise from last year’s percentage of just 10.4%.

Kosei Takiishi, Senior Research Director at Gartner, said the growth is a reflection of various 5G initiatives and priorities within the CSP sector — driven by heightened competition and the rising threat of disruption. Additionally, new O-RAN (open radio access network) and vRAN (virtualised RAN) ecosystems could promote 5G adoption by providing cost-efficient and agile 5G products in the future.

“Investment in wireless infrastructure continues to gain momentum, as a growing number of CSPs are prioritising 5G projects by re-using current assets including radio spectrum bandwidths, base stations, core network and transport network, and transitioning LTE/4G spend to maintenance mode,” Takiishi said.

“Early 5G adopters are driving greater competition among CSPs. In addition, governments and regulators are fostering mobile network development and betting that it will be a catalyst and multiplier for widespread economic growth across many industries.”

In the short term, Greater China leads the world in 5G development, with 49.4% of worldwide investment in 2020 attributed to the region. Cost-effective, domestically-manufactured infrastructure — coupled with state sponsorship and fewer regulatory barriers — is enabling major CSPs in China to build 5G coverage quickly.

“CSPs in all regions are quickly pivoting new and discretionary spend to build out the 5G network and 5G as a platform,” Takiishi concluded.

Image credit: ©stock.adobe.com/au/tampatra

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