RAN spending splurge in Q4 helps market top $35B in 2020 – Dell'Oro
Stefan Pongratz, analyst with Dell'Oro Group, a market research firm, holds his hands up.
While Dell'Oro correctly identified the overall upward trajectory of the RAN market, said Pongratz – even though the pandemic intensified and "economists adjusted their GDP projections sharply downward" – he conceded that "we completely underestimated the magnitude and the breadth of the ascent in the fourth quarter and for the full year 2020, reflecting stronger than expected results in multiple regions."
Pongratz told Light Reading that the original market-growth estimate was mid-single digit rate advances. The market research firm now calculates total RAN revenue, from 2G through to 5G, increased by more than 10% during 2020 to top $35 billion.
"Growth was driven by stronger than expected 5G NR investments in North America and China," explained Pongratz. "We estimate 5G NR comprised 30% to 50% of the overall RAN mix in 2020."
When taking China out of the equation, Dell'Oro says Ericsson and Nokia maintained their respective number one and number two positions in supplier RAN rankings for 2020.
No doubt helped by geopolitical squeezes on Huawei and ZTE, Ericsson and Nokia actually increased their RAN market shares outside China in 2020 compared with the year previously, going from 35% to 40% (Ericsson) and 25% to 30% (Nokia).
Factor in the huge China market, however, and Huawei keeps its number one position in the overall RAN market. The other top four RAN suppliers globally, in descending order, are Ericsson, Nokia, ZTE and Samsung.
A question of when, not if, for open RAN
Earlier this month, Dell'Oro forecast open RAN revenues to grow at double-digit rates over the next six years with cumulative investments – including hardware, software and firmware (excluding services) – projected to approach $10 billion over the 2020 to 2025 forecast period.
Dell'Oro expects open RAN to account for less than 5% of the 2020 to 2025 RAN market, on a cumulative basis, and says it will have a 10% share of total spend in 2025.
"The conversation and the overall attitude toward open RAN has clearly changed over the past six months," said Pongratz.
"It is no longer a question if open RAN will happen; the question now is more on the timing and the scope."
— Ken Wieland, contributing editor, special to Light Reading