Global 5G Infrastructure market will reach USD 17.07 billion by 2025

The global 5G infrastructure market is valued at USD 784 million in 2019 and is estimated to reach USD 1310 million by the year 2020.

Its market value is expected to grow at the CAGR of 67.1% within the time horizon of 2020-2025 because of the growing smart cities, increasing machine to machine connections, and low latency of 5G networks.

Its market value will reach USD 17067 million by the year 2025.

Definition / Scope
Market Overview
Market Risks
Top Market Opportunities
Market Trends
Industry Challenges
Technology Trends
Pricing Trends
Market Size and Forecast
Market Outlook
Technology Roadmap
Distribution Chain Analysis
Competitive Landscape
Competitive Factors
Key Market Players
Strategic Conclusion
References
Appendix

Definition / Scope

5G infrastructure is the fifth generation ultra-broadband mobile network that supports high-speed internet service. The 5G network infrastructure consists of the large and small-scale base stations with edge computing capabilities, which assists in reducing latency, improving reliability, connectivity, and performance.

This network infrastructure is applied in the sector of telecom services providers, automotive & transportation, consumer electronics, and others. Globally, more than 10 million people are estimated to be the 5G mobile subscribers in the year 2019.

Based on the type of network architecture, the global 5G infrastructure market consists of standalone and Non-standalone networks. Based on the type of spectrum, this market is categorized into two segments i.e. Sub-6 GHz and mmWave.

Market Overview

The total market size of the global 5G infrastructure market is valued at USD 784 million in the year 2019 and is expected to reach USD 1310 million in the year 2020. Its market value is expected to grow at a CAGR of 67.1% within the forecasted time horizon of 2020-2025. Its market value is expected to reach USD 17,067 million by the end of the year 2025.

Based on geography, the European region is leading the global 5G infrastructure market with a market share of almost 50% of the total global 5G infrastructure market. The market size of this region is valued at USD 392 million in the year 2019.

Based on the spectrum insights, the sub-6 GHz is leading the market with a market share of almost 84.4% of the global 5G infrastructure market because of the huge investment of the communication service providers in the low and mid-band frequencies. The market size of this segment is valued at USD 661.7 million in the year 2019.

Based on the network architecture, the Non-standalone segment is leading the market with a market share of 88.33% of the global 5G infrastructure market. The market size of this segment is valued at USD 692.53 million in the year 2019.

As per the application of the global 5G infrastructure, the market is considered, the telecom services providers are leading the market with a market share of almost 90.28% of the global 5G infrastructure market. The market size of this segment is valued at USD 707.78 million in the year 2019.

Growing smart cities market, increasing machine to machine connections, low latency of 5G networks, and growth in mobile data traffic are the factors driving the growth and development of the global 5G infrastructure market. However, the high investment cost of the 5G infrastructure might restrain the growth and development of the global 5G infrastructure market.

Along with this, the existing pandemic outbreak of the COVID-19 disease will temporarily create the risk for the development of the global 5G infrastructure market. The key market players engaged in this market are Ericsson, Huawei, Nokia Networks, Samsung Electronics, ZTE Corporation, Intel Corporation, and Hewlett Packard Enterprise.

Market Risks

Existing outbreak of COVID-19 disease

The pandemic outbreak of the COVID-19 disease has caused the disruptions in the trials related to the stability and performance of 5G standalone networks. Because of this, some of the countries have postponed the plans for the auction of 5G infrastructure.

For instance, France, Spain, and Australia have postponed the spectrum auction on sub-6 GHz and mmWave. Along with this, the pandemic outbreak of this disease has influenced the exports of telecom equipment for 5G new radios from countries like China, the US, etc to the global 5G infrastructure market.

The existing pandemic outbreak can temporarily create the risk for the growth and development of the COVID-19 disease.

Top Market Opportunities

Low latency in 5G mobile networks

The latency is the time interval between the transmission and reception of the packet. The use of advanced technology and remote control for the infrastructure requires a high level of precision without any sorts of time lag and error.

The use of existing 4G networks can cause the delay and problems in critical situations while the use of 5G mobile networks is expected to decrease the end to end latency by almost 10 times.

The emerging use of 5G mobile networks will significantly reduce the latency while either video chatting with a friend, or playing games in virtual reality and will improve the user experiences in these situations.

The low latency in the use of the 5G mobile networks will create a significant opportunity for the growth and development of the global 5G infrastructure market.

Growth in mobile data traffic

Over the past five years, the global mobile data traffic has been increased by almost eightfold and the mobile network connections speed is increase by almost threefold.

It is expected that the average smartphone will generate 4.4 GB of traffic per month by the end of the year 2020 and 11 GB of traffic per month by the year 2022. The 5G networks will have 2.6 billion subscriptions which account for almost 65% of the total global population by the end of the year 2025.

The use of a 5G network will further generate 45% of the total global mobile data traffic by the year 2025. The rising demand for mobile data traffic is driving the growth and development of the global 5G infrastructure market.

Market Trends

Increasing Machine to Machine (M2M) connections

Globally, the number of the machine to machine connections is in increasing trend. Its number has been increased from 0.5 billion in 2014 to 2 billion in 2019. It is expected to reach almost 3.3 billion by the year 2021.

The existing mobile networks such as 4G, 3G, Wi-Fi, and other wireless networks can support the limited number of connections. Because of this, the demand for the 5G networks is increased for the increasing machine to machine connection, data transfer, and connection support.

This increasing number of the machine to machine connections is creating a significant opportunity for the growth and development of the global 5G infrastructure market.

Growing smart cities in emerging economies

The smart cities use different types of information and communication technologies such as electronic Internet of things sensors for the collection and use of data for the resources and assets management.

This type of urban city requires high-speed network services with low latency and robust connection. The global market for smart cities is increasing at a CAGR of 21.28% within the forecasted time horizon of 2020-2025 because of the growing urbanization, rising need for a better quality of life, and government smart cities initiatives.

Its market value is expected to reach USD 2,402.12 billion by the end of the year 2025, will increase from USD 517.62 billion in the year 2017. The growing global smart cities market will create a significant opportunity for the growth and development of the global 5G infrastructure market.

High investment cost of the 5G infrastructure

Globally, the cost of investment in the sector of the 5G infrastructure is quite high. The global cost of the investment in 5G infrastructure is expected to be about USD 2.7 trillion by the end of the year 2020. Along with this, the installation cost of the 5G infrastructure is also high.

For instance, the installation of the fiber optic cabling costs almost USD 130- USD 150 billion and takes almost 5 to 7 years for completion. The investment cost associated with the installation of the 5G infrastructure might restrain the growth and development of the global 5G infrastructure market.

Industry Challenges

Highly consolidated market

The global 5G infrastructure has a highly consolidated market as the majority of its market value is accounted for by the top few market players. The top five key market players account for more than 60% of the total market value of this market. Here, the top five market players are Ericsson, Huawei, Nokia Networks, Samsung Electronics, and ZTE Corporation.

Here, Ericsson is the leading market player accounting for a market share of almost 20.56% of the total global 5G infrastructure market followed by Huawei which accounts for a market share of almost 7.78% of the total global 5G infrastructure market. It is quite challenging for the market players to establish their market value.

Technology Trends

Advancing technology and innovation is driving the implementation of 5G networks all over the world. Some of the key technological trends occurred in the global 5G infrastructure market are discussed as follows:

Internet of things: It is an integrated system consisting of mechanical, digital, and computing machines that allows the transfer of the data over a network without a human to human and human to computer interaction.
Wearable technology: These technological devices consist of smart electronic devices that are worn on the surface of the skin to detect, analyze, and transmit information related to human activities.
Autonomous Vehicles: These types of vehicles consists of sensors that perceive and sense the environment and are capable of moving safely with very limited or no human input. They are also called self-driving or robotic vehicles.

Pricing Trends

The cost of the 5G infrastructure depends upon the type of network architecture, spectrum, technology, and application of the 5G networks.

For example, the cost required for the small cell deployment on the road infrastructure is about USD 2.1 billion while the cost of such deployment in rail infrastructure is about USD 675.48 million.

The global investment cost required for the 5G infrastructure is expected tor each USD 2.7 trillion in the year 2020.

Market Size and Forecast

The total market size of the global 5G infrastructure market is valued at USD 784 million in the year 2019 and is expected to reach USD 1,310 million in the year 2020. Its market value is expected to grow at a CAGR of 67.1% within the forecasted time horizon of 2020-2025. Its market value is expected to reach USD 17,067 million by the end of the year 2025.

Based on geography

The European region is leading the global 5G infrastructure market with a market share of almost 50% of the total global 5G infrastructure market. The market size of this region is valued at USD 392 million in the year 2019.
The North American region accounts for a market share of almost 30.77% of the total global 5G infrastructure market. The market size of this region is valued at USD 241.23 million in the year 2019.
The Asia-Pacific region accounts for a market share of almost 15.38% of the total global 5G infrastructure market. The market size of this region is valued at USD 120.62 million in the year 2019.
The ROW stands for the rest of the world that includes South America, the Middle East, and the African Region. This segment accounts for a market share of almost 3.85% of the total global 5G infrastructure market. The market size of this segment is valued at USD 30.15 million in the year 2019.

Based on the spectrum insights

The sub-6 GHz is leading the market with a market share of almost 84.4% of the global 5G infrastructure market because of the huge investment of the communication service providers in the low and mid-band frequencies. The market size of this segment is valued at USD 661.7 million in the year 2019.
The mmWave segment accounts for a market share of almost 15.6% of the total global 5G infrastructure market. The market size of this segment is valued at USD 122.30 million in the year 2019.

Based on the network architecture

The Non-standalone segment is leading the market with a market share of 88.33% of the global 5G infrastructure market. The market size of this segment is valued at USD 692.53 million in the year 2019.
The standalone segment accounts for a market share of almost 11.67% of the total global 5G infrastructure market. The market size of this segment is valued at USD 91.47 million in the year 2019.

Based on application

The telecom services providers are leading the market with a market share of almost 90.28% of the global 5G infrastructure market. The market size of this segment is valued at USD 707.78 million in the year 2019.
The automotive and transportation segment accounts for a market share of almost 1.11% of the total global 5G infrastructure market. The market size of this segment is valued at USD 8.71 million in the year 2019.
The consumer electronics segment accounts for a market share of almost 5% of the total global 5G infrastructure market. The market size of this segment is valued at USD 39.2 million in the year 2019.

Market Outlook

The global 5G infrastructure market is expected to grow at the CAGR of 67.1% within the forecasted period of 2020-2025 because of growing smart cities market, increasing machine to machine connections, low latency of 5G networks, and growth in the mobile data traffic are the factors driving the growth and development of the global 5G infrastructure market.

Its market value will reach USD 17067.69 million by the year 2025.

Technology Roadmap

The adoption of innovative technological solutions is creating a favorable environment for the implementation of the 5G infrastructure globally. For instance, the incorporation of smart cities, autonomous vehicles, and wearable technologies are driving the demand for the robust and low latency 5G technology.

Along with this, the increasing use of the digitalized system in the daily activities will drive the growth and development of the 5G infrastructure market.

Distribution Chain Analysis

In the delivery of the 5G networks, the involved key stakeholders are the central server system, 5G macro cell, local servers, 5G microcell, 4G macro cell, and the end-users.

At first, the central server system provides the network services for 5G macro and small cells. The 5G macrocell is integrated with 4G networks and then provided to the end-users through the local server system.

Competitive Landscape

The key top five market players engaged in the global 5G infrastructure market are Ericsson, Huawei, Nokia Networks, Samsung Electronics, and ZTE Corporation.

Here, the Ericsson is leading the market with a market share of almost 20.56% of the total global 5G infrastructure market.

Competitive Factors

The key market players engaged in this 5G infrastructure market are focused on the product portfolio expansion, high investment in research and development activities, mergers & acquisitions, geographical expansion, and collaborations.

For example, Ericsson has done a partnership with Intel Corporation to develop the next-generation hardware management platform delivering cloud-like agility for distributed cloud and 5G.

China Mobile Limited has done a partnership with Huawei Technologies, ZTE Corporation, and Ericsson to deploy 5G radio access network in China.

Along with this, they are focused on the overall productivity, operational efficiency, and reduced cost of the infrastructure.

Key Market Players

Short profile of the key market players engaged in the global 5G infrastructure market is discussed as follows:

Huawei: It is one of the leading global information and technology solutions providers with almost 36 joint innovation centers, and 14 research & development centers. It is committed to the digital and intelligent world with its headquarter in China.

Ericsson: It is the Sweden-based leading global information and communication technology company engaged in the field of the networks, digital services, managed services, and emerging business.

Samsung: It is a world wide South Korea-based multinational company engaged in the field of electronics, telecommunications, home appliances, automotive, chemicals, and medical equipment. The revenue of this company is valued at USD 208.5 billion.

Nokia Networks: It is a multinational telecommunications infrastructure and equipment company which was founded in 2007. It has its headquarter in Espoo Finland.

ZTE Corporation: It is a Chinese multinational company engaged in the manufacture of telecommunications equipment and systems with its headquarter in China. The revenue of this company is valued at USD 12.82 billion in 2019.

NEC Corporation: It is a Japanese multinational company engaged in the sector of information technology and electronics with its headquarter in Minato City, Tokyo, Japan. The revenue of this company is valued at USD 27 billion in the year 2019.

Strategic Conclusion

The global 5G Infrastructure Market is growing at a rate of 67.1% because of the growing smart cities market, increasing machine to machine connections, low latency of 5G networks, and growth in mobile data traffic.

However, the high investment cost of the 5G infrastructure disease might restrain the growth and development of the global 5G infrastructure market. The existing pandemic outbreak of the COVID-19 disease will temporarily create the risk for the development of its market.

References

Appendix

USD= United States Dollar
CAGR= Compound Annual Growth Rate