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Hyperscalers are poised to disrupt the private cellular networks market over the next few years

Hyperscalers are poised to disrupt the private cellular networks market through their ecosystems, platforms and marketplaces

Hyperscalers (especially Amazon, Google and Microsoft) intend to standardize, modularize and verticalize private cellular networks (PCN)-related solutions inside their ecosystems, platforms and marketplaces, especially as it pertains to 5G and edge computing. Hyperscalers are focused on hiding the complexity of private networks and edge computing, enabling end users to more easily procure and consume these resources and unlock the value of data.

Enterprise and government consumption of networking resources will ultimately come to resemble how IT resources are consumed via the cloud, and solutions will be outcome-based. Early manifestations of this trend can be seen with Microsoft’s packaging of its 5G core with Azure Private Multi-Access Edge Compute (MEC) to enable and drive enterprise digital transformation with on-premises private 5G MEC. Microsoft is also building a range of vertical-specific use case solutions spanning smart factory, defense, retail transformation, and healthcare. Amazon and Google are following Microsoft’s lead in this domain.

Ultimately, TBR believes a large portion of activity in the private cellular networks and edge computing markets will be conducted inside hyperscalers’ ecosystems. CSPs and vendors will increasingly have to play inside hyperscalers’ ecosystems in some way to stay relevant in the market as it evolves.

Private 5G Network Revenue by Provider Type 2020-2025E

TBR’s Private Cellular Networks Market Landscape deep dives into the market for private cellular networks. This global report covers enterprises that are investing in private cellular networks as well as all of the major vendors and some nascent players that supply infrastructure in this space. The research includes key findings, key market developments, market sizing and forecast, regional trends, technology trends, vertical trends, use cases, and key customer deals that are occurring in the market. TBR’s Private Cellular Networks Market Forecast, which is global in scope, details private cellular network spending trends among enterprises and governments, particularly as it pertains to 5G. This research includes current-year market sizing and a five-year forecast of several private cellular networks market segments and geographies.

Hyperscalers are poised to disrupt the private cellular networks market over the next few years

Key insights

Hyperscalers (especially Amazon, Google and Microsoft) intend to standardize, modularize and verticalize [private cellular networks (PCN)-related solutions inside their ecosystems, platforms and marketplaces, especially as it pertains to 5G and edge computing.

Enterprise and government consumption of networking resources will ultimately come to resemble how IT resources are consumed via the cloud, and solutions will increasingly be outcome-based.

Hyperscalers are focused on hiding the complexity of private networks and edge computing, enabling end users to more easily procure and consume these resources and unlock the value of data.

TBR’s Private Cellular Networks Market Landscape deep dives into the market for private cellular networks. This global report covers enterprises that are investing in private cellular networks as well as all of the major vendors and some nascent players that supply infrastructure in this space. The research includes key findings, key market developments, market sizing and forecast, regional trends, technology trends, vertical trends, use cases, and key customer deals that are occurring in the market. TBR’s Private Cellular Networks Market Forecast, which is global in scope, details private cellular network spending trends among enterprises and governments, particularly as it pertains to 5G. This research includes current-year market sizing and a five-year forecast of several private cellular networks market segments and geographies.

TBR releases exclusive webinar content from May 2021

HAMPTON, N.H. (June 3, 2021) — Technology Business Research, Inc. (TBR) announces on-demand availability of its May 2021 webinars, featuring discussions on private cellular networks leaders, laggards and investments; IT services market developments; edge computing; and blockchain.

How leading vendors performed in the private cellular networks market in 2020

Principal Analyst Chris Antlitz details exclusive content from our inaugural Private Cellular Networks Vendor Benchmark, including which vendors are growing the fastest and which regions and verticals drove the bulk of private cellular networks investment in 2020.

IT services market rebounding in 2021 after pandemic-caused trough

               Practice Manager Patrick Heffernan, Principal Analyst Boz Hristov, Senior Analyst Elitsa Bakalova and Analyst Kelly Lesiczka discuss IT services vendors’ roads to recovery post-pandemic, the impact of automation adoption in service delivery on vendors’ P&L, and what’s next for vendors’ headcount strategies.

Technology and complexity bring opportunities to services around edge

               Practice Manager Patrick Heffernan, Principal Analyst Boz Hristov and Senior Analyst Nicki Catchpole host a cross-practice discussion on how the complexity of edge computing is impacting digital transformation and creating opportunities for IT services vendors and consultancies.

Transforming the economic engine one block at a time

               Practice Manager Patrick Heffernan, Principal Analyst Boz Hristov, Senior Analyst Evan Woollacott and Senior Strategy Consultant Geoff Woollacott examine blockchain’s impact on buyers’ digital transformation initiatives and discuss blockchain-specific use cases through the lens of a multienterprise business network framework.

TBR webinars are typically held Wednesdays at 1 p.m. EST and include a 15-minute Q&A following the main presentation. To find out what we are discussing next month, check out the Webinars page of our website.

Interested in a one-on-one discussion with one of the above subject-matter experts or a private webinar with one or more of our teams?

Contact us today for more information on our free 90-day trial

LTE remains the de facto technology for private cellular networks

According to TBR’s estimates, 5G represented 8%, on average, of benchmarked companies’ PCN revenue in 2020, with the rest being LTE. LTE remains the de facto technology for PCN, thanks to its maturity and vibrant ecosystem, which has been developed over the past decade. 5G for private networks, on the other hand, remains in its infancy, with key 3GPP Release 16 standards recently ratified, 5G spectrum gradually coming to market, compatible infrastructure commercialized and endpoint devices becoming available in the past year.

The endpoint device aspect of the nascent 5G ecosystem will begin to proliferate over the next couple of years, at which point 5G PCN implementations can be scaled commercially. In the meantime, most of the 5G engagements that occurred in 2020, with the notable exception of those in China, were focused on experiments and pilots, pending the commercial availability of compatible endpoint devices. China has a significant head start with private 5G, with Huawei and ZTE equipping leading entities in the country, particularly the government, with the technology as part of national digitalization-related initiatives. Other developed APAC countries, namely South Korea, Japan, Taiwan and Singapore, are following closely behind China in 5G readiness.

TBR’s Private Cellular Networks Vendor Benchmark tracks the revenue key vendors obtain from the sale of LTE- and 5G-related infrastructure (includes RAN, core, transport and services provided for that infrastructure) to governments and enterprises, including large, medium and small non-CSP (telco, cableco, webscale) businesses. The benchmark ranks key private cellular networks vendors by overall revenue and by segment. Global market share and regional data and analysis are also provided.

PCN vendors poised for rapid growth as 5G ecosystem is built out

5G represented a small portion of the overall PCN market in 2020, but is poised to rapidly scale in coming years

According to TBR’s estimates, 5G represented 8%, on average, of benchmarked companies’ private cellular network (PCN) revenue in 2020, with the rest being LTE. LTE remains the de facto technology for PCN, thanks to its maturity and vibrant ecosystem, which has been developed over the past decade. 5G for private networks, on the other hand, remains in its infancy, with key 3GPP Release 16 standards recently ratified, 5G spectrum gradually coming to market, compatible infrastructure commercialized and endpoint devices becoming available in the past year.

The endpoint device aspect of the nascent 5G ecosystem will begin to proliferate over the next couple of years, at which point 5G PCN implementations can be scaled commercially. In the meantime, most of the 5G engagements that occurred in 2020, with the notable exception of those in China, were focused on experiments and pilots, pending the commercial availability of compatible endpoint devices.

China has a significant head start with private 5G, with Huawei and ZTE equipping leading entities in the country, particularly the government, with the technology as part of national digitalization-related initiatives. Other developed APAC countries, namely South Korea, Japan, Taiwan and Singapore, are following closely behind China in 5G readiness.

Vendors’ PCN sales funnels are burgeoning

Vendors are experiencing significant and broad interest from enterprises and governments for how to leverage PCN for digital transformation-related initiatives. 5G is of particular interest, portending a strong growth profile through this decade.

Though 5G remains primarily in the exploratory phase, many of these engagements are likely to convert into commercial contracts over the next couple of years. In the interim, the bulk of PCN deal wins will be for private LTE networks.

TBR’s Private Cellular Networks Vendor Benchmark tracks the revenue key vendors obtain from the sale of LTE- and 5G-related infrastructure (includes RAN, core, transport and services provided for that infrastructure) to governments and enterprises, including large, medium and small non-CSP (telco, cableco, webscale) businesses. The benchmark ranks key private cellular networks vendors by overall revenue and by segment. Global market share and regional data and analysis are also provided.

How leading vendors performed in the private cellular networks market in 2020

Private cellular networks, particularly LTE and 5G, have become a key growth area within the ICT ecosystem. Enterprises are investing in private cellular networks as part of their broader digital transformations and a broad array of vendors are capitalizing on opportunities in this space.

Join Principal Analyst Chris Antlitz for an in-depth, exclusive review of TBR’s first edition of its Private Cellular Networks Vendor Benchmark, during which will discuss the revenue performance of leading vendors that sell private cellular network solutions. Chris will also provide commentary on smaller but faster-growing vendors.

TBR’s Private Cellular Networks Vendor Benchmark tracks the revenue key vendors obtain from the sale of LTE- and 5G-related infrastructure (including RAN, core, transport and services provided for that infrastructure) to governments and enterprises, including large, medium and small non-CSP (telco, cableco, webscale) businesses. The benchmark ranks key vendors in the private cellular networks space by overall revenue and by segment. Global market share and regional data and analysis are also provided.

Don’t miss:

  • Which vendors are leading the private cellular networks market from a revenue perspective
  • Which vendors are growing the fastest and why
  • Which regions and verticals drove the bulk of private cellular networks investment in 2020

Mark your calendars for Wednesday, May 26, 2021, at 1 p.m. EDT,
and REGISTER to reserve your space.

Enterprise interest in 5G has greatly increased since the pandemic began, pulling forward adoption timelines

Global 2000 companies and governments will drive the vast majority of spend on private 5G infrastructure

Global 2000-sized companies and governments have the scale, financial resources and technical acumen to handle the complexity of 5G and realize its full benefits. TBR estimates over 90% of private 5G investment will stem from these entities through mid-decade, at which point network slicing, solution maturity and lower price points will enable SMBs to participate more pervasively in the 5G opportunity. TBR expects most SMBs seeking 5G will leverage public infrastructure for their needs as the cost and complexity of private 5G will be too much for many of these smaller companies to handle.

Leading enterprises intend to fundamentally transform their operations by converging IT and operational technology with 5G, edge computing, AI and machine learning, and IoT.

Manufacturers and governments are expected to be among the largest investors in private 5G networks through mid-decade.

Software upgradability of private LTE systems to 5G will enable some enterprises to accelerate their migration to 5G

A large portion of the global private LTE install base is software upgradable to 5G, which will hasten some enterprises’ move to 5G, but the timing of these upgrades will be contingent on 5G device readiness.

TBR expects leading enterprises will upgrade their private LTE systems starting in 2021 as compatible devices and 3rd Generation Partnership Project (3GPP) features from Releases 16 and 17 become available. This upgrade cycle is a key factor in why the private 5G market size will be able to scale in the early years of the forecast period.

TBR’s Private Cellular Networks Market Forecast, which is global in scope, details private cellular network spending trends among enterprises and governments, particularly as it pertains to 5G. The report includes current-year market sizing and a five-year forecast of the private cellular networks opportunity by vertical, by provider type and by region.

Enterprise spend on private 5G infrastructure will grow at a TBR-projected 97.4% CAGR from 2020 to 2025 to $7.5B

Enterprise spend on private 5G infrastructure will grow at a TBR-projected 97.4% CAGR from 2020 to 2025 to $7.5B

Key Insights

Global 2000 companies and governments will drive the vast majority (more than 90%) of spend on private 5G infrastructure through 2025.

Leading enterprises intend to fundamentally transform their operations by converting IT and operational technology with 5G, edge computing, AI, machine learning and IoT.

LTE and Wi-Fi will have a place in the private networks domain, but most enterprises will ultimately need 5G.

TBR’s Private Cellular Networks Market Forecast, which is global in scope, details private cellular network spending trends among enterprises and governments, particularly as it pertains to 5G. The report includes current-year market sizing and a five-year forecast of the private cellular networks opportunity by vertical, by provider type and by region.

Telecom operators felt the effects from COVID-19 in 1Q20; the impact on telecom vendors will be more pronounced in 2Q20

Telecom market impact

COVID-19 impacted the telecom industry during 1Q20 on different levels, with telecom operators feeling the initial effects during the quarter. TBR believes telecom vendors were initially shielded from the early effects, but we anticipate a deeper negative impact on both operators and vendors in 2Q20 as the pandemic plays out.

Though company results and the broader ICT market are expected to be challenged further in the short term (over the next year) due to the crisis, TBR believes the near term (two to three years) and long term (three to five years) will be net positive on the ICT industry as the post-COVID era drives enterprises and governments around the world to double down on digitalization and invest in a broad range of technologies to evolve their businesses and increase safety in the new world.

Telecom edge compute

The COVID-19 virus will significantly impact the ICT infrastructure supply chain, and, more broadly, the global economy. This dynamic and evolving situation prompted TBR to revise its telecom edge compute market size in the recently published Telecom Edge Compute Market Landscape.

Though the virus will delay the ultimate build-out of the edge, the cumulative market size during the forecast period is expected to be larger and grow faster than originally anticipated once the dust settles from the virus.

TBR expects the virus to delay edge spend in 2020 and a portion of 2021. By mid-2021 TBR expects the supply chain to be fully operational again, at which time the industry will attempt to catch up to align with pent-up demand.

TBR expects governments and businesses around the world will reassess their disaster response and risk profiles to mitigate future risks to their societies and operations. This will drive investment in surveillance, drones, industrial automation, blockchain, AR/VR and other use cases that require edge resources to operate. As such, TBR increased the cumulative market size for edge infrastructure as it is expected that many governments, not just the U.S. and China, will justify these investments for national security and business resiliency purposes. It is expected that communication service providers (CSPs) will be key beneficiaries of this addressable market to support government and business initiatives in these areas.

Private cellular networks

Despite short-term issues, COVID-19 will ultimately be a net positive driver of the private cellular networks market over the near to long term.

Private 5G market will eclipse private LTE market in 2023 as enterprises leverage 5G as a platform for digital transformation

The private 5G networks market will see strong growth through this decade as a broad range of industries and governments adopt the technology

Though TBR expects the market for private LTE networks will continue to grow through the mid-2020s (at an estimated CAGR of 8% to $4.4 billion from 2019 to 2024), we anticipate it will be eclipsed by private 5G beginning in 2023. TBR believes the step up in performance of 5G versus LTE and critical features endemic to the 5G 3rd Generation Partnership Project standard, such as TSN and URLLC, will be key drivers of the migration to 5G as a foundational platform for digital transformation. Many enterprises that already have private LTE networks are likely to build migration to 5G into their road maps. The software upgradability of more recent LTE infrastructure provides a more seamless and cost-effective path to 5G.

TBR’s Private Cellular Networks Market Landscape deep dives into the market for private cellular networks, particularly as it pertains to 5G. This global report covers enterprises and governments that are investing in private cellular networks as well as all of the major vendors and some of the key disruptors (e.g., startups) that supply infrastructure in this space. The research includes key findings, key market developments, market size and forecast, regional trends, technology trends, vertical trends, use cases, and acquisitions and alliances that are occurring in the market. The report also provides lists of key companies in the private cellular networks ecosystem that play a role in the market.

To read about our most recent publishing of the Private Cellular Networks Market Landscape, check out Private 5G networks market will see strong growth as a broad range of industries and governments adopt the technology.