Gartner: Global 5G network infrastructure spending will nearly double in 2020

Recently, according to the forecast of Gartner, an information technology research and consulting company, the global 5G network infrastructure market revenue will nearly double to US$8.1 billion in 2020.

The total revenue of the wireless infrastructure market will decline by 4.4% to $38.1 billion in 2020. In 2019, the investment of communication service providers (CSPs) in 5G network infrastructure accounted for 10.4% of the total revenue of the wireless infrastructure market. This investment proportion will reach 21.3% in 2020.

"Investment in wireless infrastructure continues to gain momentum as more communications service providers prioritize 5G projects by repurposing current assets, including radio spectrum bandwidth, base stations, core networks and transport networks, and transitioning LTE/4G spending to maintenance mode," said Kosei Takiishi, senior research director at Gartner. "Early 5G adopters are driving greater competition among communications service providers. In addition, governments and regulators are promoting the development of mobile networks, betting that they will be a catalyst and multiplier for broad economic growth across many industries."

Increasing competition among communications service providers has accelerated the adoption of 5G. The new O-RAN (open radio access network) and vRAN (virtualized RAN) ecosystems may subvert the existing supplier binding model and promote the adoption of 5G by providing highly cost-effective and flexible 5G products in the future. Gartner predicts that communications service providers in Greater China (mainland China, Hong Kong, China, Taiwan), mature Asia Pacific, North America, and Japan will achieve 5G coverage of 95% of the national population in 2023.

2019-2020 Global Wireless Infrastructure Market Expenditure Forecast (Unit: Million USD)

"Although the growth rate of 5G investment has declined slightly in 2020 (excluding Greater China and Japan) due to the impact of the COVID-19 pandemic, communications service providers around the world are rapidly investing new and discretionary funds in building 5G networks and 5G platforms," ​​said Mr. Takiishi.

“In the short term, Greater China leads the world in 5G development, with 49.4% of global investment in 2020 coming from the region. Cost-effective infrastructure equipment manufactured in China, coupled with state support and reduced regulatory barriers, has paved the way for major Chinese communications service providers to quickly achieve 5G coverage,” said Mr. Takiishi. “However, other early adopting and technologically proficient countries are not far behind.”

Gartner predicts that investment in 5G will rebound modestly in 2021 as the population's high reliance on communications networks will trigger behavioral changes that communications service providers will take advantage of. In 2022, investment in 5G will exceed that of LTE/4G.

Communications service providers will gradually add independent (SA) functions to their non-independent (NSA) 5G networks. Gartner predicts that by 2023, 15% of communications service providers around the world will operate independent 5G networks that do not rely on 4G network infrastructure. This will rapidly shift investment in the wireless market away from the LTE/4G field, while spending in the traditional RAN infrastructure field will also decline rapidly.