5-Year Forecast: Radio Access Network Market to Grow Over the Near-Term
With the overall RAN market now growing at the fastest pace in nearly ten years and on track to approach revenue levels not seen since the Chinese operators rolled out 3G, one of the fundamental questions is simply whether there is more room to grow with this elevated baseline, keeping in mind the historically tight coupling between RAN revenue and wireless capital intensity. And if so—where will this growth come from?
Predictions 2021–Wireless LAN Market
At the beginning of 2020, we expected a solid year for the WLAN market, driven by a still humming economy and a technology upgrade cycle to Wi-Fi 6. After the pandemic hit, we revised our forecast down steeply (double digit decline)—similar to prior economic declines. As the year progressed, however, WLAN proved resilient and 2020 revenue is on track to come slightly lower than 2019—a remarkable result of government stimulus coming primarily from the US, followed by China and select countries in EMEA such as Germany. For example, the US’ E-Rate program, which provides telecommunications funding for K-12 schools, was opened to a second round in September 2020 to allow schools to request additional funds for 2020-21 to address surging bandwidth demand stemming from remote learning. In China, the government’s Made in China 2025 initiative has provided incentives for manufacturers to modernize their processes.
Predictions 2021 – Data Center Switch Market
For the full year of 2020, we now predict the market to decline only low-single-digit, compared to our prior forecast of mid-single-digit decline. We expect the Cloud segment to grow at a low single-digit rate, in line with our prior predictions. However, we adjusted our forecast for the non-Cloud segment from high single-digit to mid-single-digit decline, as the anticipated recovery in 2H2020 will offset some of the weakness in the first half of the year (The non-Cloud segment was down 8% Y/Y in 1H2020).
Predictions 2021—Service Provider Router Market
In the ensuing months, traffic growth moderated and even contracted in some cases. Nonetheless, IP networks are transporting more traffic than ever and are likely running at higher utilization levels compared to pre-pandemic times. We expect SPs to boost network capacity and reset their operational metrics for the new traffic levels and patterns—returning to pre-pandemic practices.
Predictions 2021 – Network Security Market
As we arrive at the end of 2020, it’s a good time to look at the forthcoming year. We assume that 2021 won’t surprise like this year, and we’ll be able to start returning to pre-pandemic routines. On a global scale, most things will return to the way they were, but some may not. The same is true for the network security market, where we predict two new trends and a return of a historical one:
Predictions 2021 – Campus Switch Market
Looking at 2021, we predict the positive momentum to continue and drive 2% growth in the market. This projected growth will be propelled by improvement in macro-economic conditions as recent GDP reports indicate that economists at world-leading banks are forecasting positive GDP growth in 2021, compared to negative growth in 2020. Additionally, the availability of a vaccine will help abate the uncertainty in the market and boost business confidence.
Predictions 2021 – Optical Transport Market
Every market and industry has a cycle. In fact, some industries are comprised of many different cycles that, in combination, result in changes to the amplitude and direction of market growth. Among the different cycles that influence the Optical Transport market, I think the best cycle to highlight for 2021 is the Product Cycle.
Predictions 2021—Radio Access Network (RAN) Market
With 5G and the overall RAN market coming in a lot faster for the full-year 2020 relative to the projections we outlined a year ago, the time is right to review our 2020 projections and discuss the 2021 outlook.
Predictions 2021– Broadband Access and Home Networking Market
Sticking with cable, 2021 will see a steady increase in operators adopting distributed access architectures (DAA), including both remote PHY and remote MACPHY products. As operators continue to look across their existing node base, they are going to run into situations … DAA nodes or augmented by R-PHY shelves in order to continue to meet growing capacity demands among those service groups…
Predictions 2021– Data Center Infrastructure
2020 has been a tumultuous year in which the industry has to reevaluate its data center deployment strategy. While COVID-19 and the ensuing recession did weigh down on projected 2020 data center capex growth to just 2%, the slowdown in spending was not as much as originally feared. Some Cloud service providers have continued to expand their infrastructure to support increased internet usage and work-from-home dynamics, while a great deal of uncertainty persists in other industry sectors. Our 2021 outlook is more optimistic, with a data center capex projection of 10%. We identify the following key trends that could shape the dynamics of the data center capex in 2021.
