5G Infrastructure Market

Market Overview

The global 5G infrastructure market size was worth USD 5 billion in 2021. It is estimated to reach USD 167 billion by 2030, growing at a CAGR of 48.5% during the forecast period (2022–2030).

5G infrastructure offers low latency coverage for large data streams that power IoT devices, semi-autonomous vehicles, and augmented reality. The network of macro-and small-cell base stations with edge computational capacity required for the 5th generation technology standard for mobile networks is referred to as 5G infrastructure. Rising demand for high-speed network connectivity has enabled enterprises to install upgraded network infrastructure to enhance operational efficiency and reduce process costs. Thus, robust deployment of upgraded network infrastructure across enterprises to deliver enhanced services to their customers is estimated to propel the demand for 5G infrastructure worldwide.

The user experience for several use cases, including Ultra-high Definition (UHD) video, seamless video calling, and Virtual Reality (VR) and Augmented Reality (AR) gaming, is anticipated to be improved by 5G technology. Several manufacturing facilities are focusing on technological revolutions to boost their total output, improve operational efficiency, and save costs to survive in a highly competitive industry.

Market Dynamics

Market Drivers

• Continual Rise in Data Traffic and Resulting Need for Network Capacity Expansion

The need for 5G infrastructure is driven by the continuous rise in data traffic and the need for network capacity expansion. Internet traffic has skyrocketed in the last year due to the increase in many digital activities caused by the lockdowns and restrictions imposed during the pandemic. The COVID-19 pandemic resulted in millions of people worldwide using videoconferencing for work and learning from home, among other things. In March–April 2020, the three major platforms reported 700 million daily users. When other platforms were included, the total number of users amounted to roughly one-tenth of the world's population. 

The average number of Zoom users has increased from 10 million in December 2019 to 300 million in April 2020. 1 Cisco's Webex had 324 million users in March 2020, more than doubling from the previous month. 2 In April 2020, Microsoft Teams had 75 million daily users. 3 Being confined to one's home also increased one's use of social media, video streaming, and online gaming. Massive increases in data traffic have resulted from these online activities. Internet traffic increased by 40% in Spain following the shutdown, while mobile data traffic increased by 25%.

• Need for Ultra-Low Latency

Latency is described as the data packet's gap time or transfer rate. The time between when a package is sent and when the recipient receives it is referred to as one-way latency. In contrast, roundtrip latency is the period between packet transmission and acknowledgment reception. The advent of intelligent concepts such as IoT, connected devices, artificial intelligence, and augmented and virtual reality are speeding up. However, due to high latency issues, businesses cannot fully explore the full potential of these technologies. Consequently, 5G has become more popular because it provides low latency and an improved user experience.

Telemedicine, in which hospitals and other health care providers can connect real-time data without delay during a life-threatening scenario, could be one of the most critical low latency applications. The low latency rate of this technology is likely to result in remote robotics treatments in the near future. Therefore, the soaring need for low latency is anticipated to fuel the demand for a 5G network.

Market Restraint

• Growing Cybersecurity Threats

The 5G rollout has officially started, bringing with it plenty of advantages that have the potential to impact human life and work. With faster connectivity, ultra-low latency, and greater network capacity, 5G will reshape the operations of essential infrastructure actions from the plant floor to the cloud. Large-scale connections, capabilities, and services will be empowered, paving the way for smart cities, self-driving cars, remote surgery, and other new technologies.

5G networks, on the other side, are an enticing target for cybercriminals and foreign adversaries looking for precious information and knowledge, as well as a global disturbance. The rapid expansion of IoT systems has been fueled by network appliances, consumer electronics, business, and industrial IoT (IoT) devices. 5G technology is improving certain IoT functions, likely to result in an expansion of IoT devices and a security problem that organizations and individuals cannot deal with.

Security experts are falling behind in the rapid development of new technology, such as cloud, AI, and IoT. According to the 2021 (ISC)2 Cybersecurity Workforce Study, an information security professional workforce gap of 2.72 million. While many institutions are turning to security automation and machine learning remedies to fill the void, these solutions will not cover all risk areas. This human resource scarcity creates trouble for businesses attempting to implement or expand their use of fifth-generation networks. Moreover, by rushing to implement new technologies, mostly without proper planning or expertise, companies expose themselves to security breaches that can result in massive losses.

Market Opportunities

• Increasing Deployment Of 5G Network Infrastructure for Smart City Use-Case Applications

Global urbanization is accelerating, with cities now housing more than 54 percent of the world's population. Many Chinese cities, such as Beijing, Shanghai, Guangzhou, and Shenzhen, have more than 10 million people. Cities have grown more extensive and complex in recent years, posing numerous risks, concerns, and management challenges.

To assist the increased density of small cells required to achieve both the economic and Smart City benefits enabled by 5G wireless networks, municipal leaders should take several steps to stimulate telecom operators to invest in deploying next-generation infrastructure in their municipalities.

Cities are becoming more innovative in operating, delivering services, and supporting residents and businesses due to the internet of things (IoT), artificial intelligence (AI), cloud computing, and fast communication networks. The continued deployment of 5G networks, with significant increases in speed, bandwidth, and data throughput, will only accelerate the global development of smart cities. 

Regional Analysis

By region, the global 5G infrastructure market share is segmented into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa. 

Asia-Pacific Surpasses Other Regions

Asia-Pacific is the most dominant and the fastest-growing region. It is estimated to reach USD 78 billion by 2030 at a CAGR of 52.6%. This is due to the combative deployment of 5G New Radio infrastructure by significant telecom service providers such as KT Corporation, China Mobile Limited, and NTT Docomo Inc. Moreover, governments in China, Japan, and South Korea are focusing on releasing multiple sub-6GHz, and mm-Wave frequency ranges to meet the increasing demands for high-speed data connectivity between many subscriber bases. As an outcome, the region's market is anticipated to increase during the forecast period.

In addition, the presence of several 5G and communication services is expected to drive the demand. China is expected to dominate the market. As per MIIT, China will have 2 million 5G base stations installed this year to accelerate the country's next-generation mobile network expansion while formulating the development of the advanced 6G wireless system (MIIT). Currently, the Chinese mainland has 1.425 million 5G base stations in operation, supporting over 500 million 5G users nationwide.

Europe stands second for global demand in the 5G infrastructure market due to predominant vendors and carriers' investments in launching the technology in this region. It is estimated to reach a predicted value of USD 131.5 billion by 2030 at a CAGR of 49.6%. The European Commission and the European ICT industry's public-private partnership (5G PPP) to provide 5G infrastructure will deliver solutions, architectures, technologies, and standards for another generation.

The North American market is anticipated to grow at a sizable CAGR throughout the forecast period due to the presence of significant service providers like AT&T Inc., Sprint Corporation, T-Mobile, and Verizon Communications. The aforementioned corporations' extensive efforts in constructing 5G infrastructure are expected to accelerate regional market growth. For instance, T-Mobile and Ericsson agreed to a 3.5 billion USD deal in September 2018 to enhance T-5G Mobile's network infrastructure. As part of the agreement, Ericsson will give T-Mobile hardware and software for the 5G New Radio (NR) to offer high-speed internet. Additionally, it is projected that the adoption of next-generation network infrastructure will rise in the upcoming years due to the escalating need for high-speed data networks to construct autonomous factories.

Segmental Analysis

The global 5G infrastructure market share has been classified based on communication information, spectrum, network architecture, vertical, and regions.

On the Basis of Communication Information

By communication information,

The global 5G infrastructure market is segmented into Hardware (Radio Access Network, Core Network, xHaul, and Transport Network) and Services (Consulting, Implementation and Integration, Support and Maintenance, and Training and Education).

The Hardware segment dominates the global 5G infrastructure market. It is expected to reach USD 130.5 billion by 2030, generating a CAGR of 48.8%. 

Radio Access Network (RAN) holds the most commanding position within the hardware segment. It is estimated to reach a predicted value of USD 88 billion by 2030 at a CAGR of 54.2%. This is attributable to the robust deployment of 5G RAN with several small cells and macrocell base stations worldwide. Implementing virtual and centralized RAN is rapidly increasing among network service providers to reduce the overall infrastructure costs and network complexities. In addition, the use of Software-defined Networking (SDN) technology to improve the operational efficiency of virtual RANs is further expected to play a crucial role in the overall segment growth.

Core Network is estimated to reach a market size of USD 84 billion by 2030 at a CAGR of 58.3%. It plays a critical part in handling network traffic and stores consumer information. However, leading network suppliers are migrating toward mounting cloud-based 5G core networks to lower the Total Cost of Ownership (TCO) and deliver fluent connectivity. For example, in April 2020, Ericsson and British Telecommunication PLC (BT) contracted to implement a fully cloud-native mobile packet core for standalone and non-standalone networks to fulfill the high-speed bandwidth needs of individual consumers and firms.

On the Basis of Spectrum

By spectrum, the global 5G infrastructure market is segmented into Sub-6 GHz and Millimeter Wave (mmWave).

The Sub-6 GHz segment holds the most significant global 5G infrastructure market share. It is expected to reach USD 75 billion by 2030, generating a CAGR of 38.5%. This is attributed to the enormous investments made by crucial communication service providers in acquiring low and mid-band frequencies and consequently delivering high bandwidth services to consumers, businesses, and industries. Recently, the governments across critical countries such as China, the US, Japan, South Korea, and many other countries released sub-6 GHz frequencies to provide high-speed internet services in their countries. 

mmWave segment is the fastest-growing. It is estimated to reach a value of USD 129 billion by 2030 at a CAGR of 78%. The US Federal Communication Commission (FCC) released several mmWave frequencies, including 24.25–24.45 GHz, 24.75–25.25 GHz, 47.2-48.2 GHz, and 38.6-40 GHz, among others, with a view of delivering connectivity with reduced latency for applications such as autonomous vehicles. Also, other countries, such as Russia, South Korea, Japan, and Italy, have utilized mmWave frequencies for improved data services. Thus, increased emphasis on to release mmWave frequencies by key federal governments across many countries is expected to augment the mmWave segment growth.

On the Basis of Network Architecture

By network architecture, the global 5G infrastructure market is segmented into Standalone and Non-Standalone.

Standalone is the fastest-growing segment. It is expected to reach USD 10 billion by 2030, generating a CAGR of 82.3%. The fast-growing industrial digitalization has paved a new revenue stream for service providers across the globe. To provide uninterrupted connectivity between machine-to-machines, the need for the ultra-reliable high frequency with reduced latency connectivity is rising. Similarly, the requirement for unified bandwidth capacity with minimum latency to discover seamless communication between autonomous vehicles is projected to drive the need for 5G infrastructure in the transportation and logistics sector. Therefore, the demand for faster data speed across the verticals mentioned above will cause standalone segment growth.

With a revenue share of over 80% in the worldwide 5G infrastructure market by 2022, the non-standalone (NSA) network architecture is expected to grow profitably. This can be ascribed to the non-standalone network's early global adoption. The non-standalone network is typically installed in conjunction with the current LTE network. A 5G NSA network model has also been implemented by several top service providers, including AT&T, Verizon Communication, and China Mobile Limited, for primary use cases, including cloud-based AR/VR gaming and UHD films.

Non-Standalone (NSA) network architecture acquires the most dominant position in the market. It is estimated to reach a value of USD 107.5 billion by 2030 at a CAGR of 42.9%. This is accredited to the early rollout of the non-standalone network globally. The non-standalone network is usually deployed in integration with the previous LTE infrastructure. Besides, many leading service suppliers such as AT&T, Inc., Verizon Communication, and China Mobile Limited have used a 5G NSA network model for primary use cases, such as cloud-based AR/VR gaming and UHD videos.

On the Basis of Vertical

By vertical, the global 5G infrastructure market is segmented into Residential, Enterprise/Corporate, Public Safety and Defense, Smart City, Industrial, Energy and Utility, Transportation and Logistics, Healthcare Facilities, Retail, Agriculture, and Others.

The Enterprise and Corporate vertical holds the largest share of the market. It is expected to reach USD 40 billion by 2030, generating a CAGR of 50.7%. This is accredited to the surging need for faster data bandwidth for use cases, involving uninterrupted digital meetings, seamless connectivity during cloud computing, and creating an intelligent workplace by providing enhanced connectivity to IoT devices.

Residential Vertical acquires the second-largest market share. It is estimated to reach a value of USD 30 billion by 2030 at a CAGR of 50.7%. The necessity to offer seamless connectivity to intelligent home applications, cloud-based Augmented Reality/Virtual Reality gaming, and others has raised the implementation of 5G infrastructure for residential or consumer applications.

The Industrial vertical is the fastest-growing segment. It is estimated to reach a value of USD 33.5 billion by 2030 at a CAGR of 53.7%. The increasing demand to discover continual communication among industrial applications is expected to propel the growth of the industrial segment over the forecast period. These industrial applications primarily include collaborative/cloud robots, automated guided vehicles (AGVs), wireless cameras, and others.

The demand for high-speed internet access across energy-generating and distribution applications is expected to drive significant growth in the energy and utility sector. The adoption of 5G technology and associated infrastructure in the transportation and logistics sector is further anticipated to be fueled by the growing demand to provide improved connectivity to ships and containers/vessels for effective monitoring from remote areas.

Recent Developments

• April 2022 - GFO Investments and Airspan Networks collaborated to help transform the hospitality industry at The Gale South Beach, one of the first US hotels to provide its guests with a high-speed 5G CBRS private network.
• February 2022 - Juniper Networks announced the purchase of WiteSand, an innovator in cloud-native zero trust Network Access Control (NAC) solution provider.
• In December 2022, BMWs with AT&T NumberSync® for Connected Car become smartphones on wheels.
• In October 2022, AT&T will launch a dozen 5G "Edge Zones" around the United States to enable the next generation of network services.
• In September 2022, Ford Super Duty models will have 5G connectivity from AT&T starting in 2023.
• In December 2022, With a shareable indoor 5G solution, Ericsson, Solutions by STC, and ACES will improve network performance in the Kingdom of Saudi Arabia.
• In December 2022, Network lags are predicted and avoided by Ericsson, China Mobile, and Tencent Cloud using an award-winning 5G time-critical solution.