5G core network revenue expected to reach $1 billion by 2020

5G core network revenue will reach $1 billion in 2020, driven by strong investment and growth in 5G networks.

Service providers are accelerating their 5G core market deployments, a trend expected to continue through 2021, according to Dell'Oro Group's Mobile Core Networks Quarterly Report.

5G core deployments accounted for approximately 15% of mobile core network revenues in 2020. Moreover, in the last four quarters ending in the second quarter of 2020, 4G/5G core network revenues grew 15% year-over-year.

The report also noted that IMS Core VoLTE revenue grew 8% year-over-year in the last four quarters ending 2Q20. Network function virtualization also exceeded 50% for the first time in 2Q20.

"This was the first quarter that vendors started reporting 5G Core revenues, and they were surprisingly strong," said David Bolan, research director at Dell'Oro Group.

He noted that Huawei and ZTE are leading in 5G core, and even vendors like Mavenir have added it to their revenues.

Huawei has been promoting 5G technology over the past few years. In 2019, the company revealed its first fully containerized 5G core network, which uses container technology to assist in network deployment.

Container technology is the best choice for microservice architecture. It can meet changing service requirements by making 5G networks more agile and flexible, maximizing resource utilization, and enabling rapid fault location and self-healing. "Huawei said in 2019.

At the time, Huawei also announced the adoption of a core network based on network function virtualization (NFV) to "enable stateless design, cross-DC deployment, A/B testing, and other innovative technologies."

As of September 2019, Huawei has signed more than 50 5G commercial contracts worldwide, helping operators seize the initiative in 5G deployment and provide "end-user experience".

"The ramp-up in the second half of 2020 has already begun, with T-Mobile commercially launching its 5G standalone network in August and recognizing Cisco and Nokia as its 5G network suppliers," Bolan said.

“Other regions are expected to launch nationwide 5G standalone network services in the second half of 2020, including China. And Ericsson, Nokia and Samsung are widely expected to become 5G core suppliers in South Korea.”