The global O-RAN market is estimated to attain a revenue of USD 419.51 Million in 2021 and USD 21,371.47 Million in 2028 by growing at a CAGR of 83.1% over the forecast period, i.e., 2020-2028. Increasing utilization of online applications, such as virtual meetings, cloud-based services, streaming of 3D & ultra-HD (8K) resolution video content, and others, along with the growing demand for high-speed data is anticipated to raise the adoption of 5G technology in the coming years, and in turn drive the market growth during the forecast period. It is estimated that by the end of 2025, almost half of the world would be connected with 5G network connectivity. Additionally, the shift in preferences amongst the consumers towards digital communication, is allowing telecom operators to expand their service offerings, which in turn is expected to drive the demand for open radio access network technology. Open-RAN benefits both RAN vendors, operators, and 3rd parties. The cellular network operators adopt Open-RAN because it provides additional flexibility to meet rigorous 5G application requirements in several vertical industries with various network requirements for performance, capacity, and latency. By the end of 2020, the market registered a revenue of USD 169.50 Million.
The Open-RAN architecture is designed so that it helps in lowering the total costs of ownership of RAN networks. The cost reductions depend on two significant factors: lower upfront capital deployment costs and lower operating expenses through automation. The lowering operational costs and the gradual growth in telecom subscribers is expected to raise the adoption of Open-RAN technology amongst the mobile network operators (MNOs). Moreover, it is anticipated that in 2021 around 2 million 5G cell sites will be deployed in the United States. The network architecture allows the operators to aggregate baseband functionality by utilizing a single virtualized BBU to support multiple radios and also reduces the overall hardware cost, and enables a smaller, more manageable, and more energy-efficient installation footprint worldwide. Moreover, the technology can reduce the ongoing network operating and maintenance expenses. Furthermore, open interfaces allow the implementation of new network features and functions operable on any vendor's hardware without the need for engineers and technicians for vendor-specific integration. Open-RAN can also replace the time-consuming and manual work of maintaining, upgrading, and optimizing networks via centrally managed and automated computing processes. Such factors are expected to drive the growth of the global O-RAN market during the forecast period.CLICK TO DOWNLOAD SAMPLE REPORT
Regionally, the global market is segmented into five major regions comprising North America, Asia Pacific, Europe, South America, and Middle East & Africa. Among the markets in these regions, the Asia Pacific O-RAN market is expected to hold the leading market share of 38.1% and attain a revenue of USD 8,150.95 Million in 2028 by growing at a CAGR of 81.7% during the forecast period. Moreover, based on country, the market in Japan is expected to garner the largest market revenue of USD 1887.90 Million by the end of 2028. The market in North America captured the second leading stance in 2020 and is expected to garner a revenue of USD 134.38 Million in 2021, owing to the increasing virtual meetings and cloud-based services adopted by the end users. In North American region, United States is projected to generate significant growth opportunities for by holding the largest market share throughout the forecast period while Canada is projected to grow with the highest CAGR of 134.8% during the forecast period. Major American telecom companies and network operators, including AT&T, T-Mobile U.S., Verizon, and UScellular, have joined the O-RAN Alliance founded in 2018. The objective of the O-RAN Alliance is to reshape the RAN industry towards mobile networks that are more intelligent, open, virtualized, and fully interoperable. The U.S. and Canada are the primary markets for O-RAN in North America. In the U.S., the growth of O-RAN is primarily led by the boost in the adoption of IoT and IIoT coupled with increasing research and development for developing efficient O-RAN solutions. In addition to this, the United States government considers Open-RAN a viable strategy for wireless providers to avoid using telecommunications equipment from Chinese vendors, such as Huawei and ZTE.
Moreover, the government has planned to invest around $1 billion in new open radio access network technologies to spur US software companies. Initiatives such as these are anticipated to elevate the market growth during the forecast period. North America is witnessing a surge in demand for O-RAN attributed to its applications in autonomous and vehicles and advanced in-home entertainment systems. Fast and secure communication networks, including LTE and 5G, are the foundations for autonomous driving. 5G applications such as autonomous vehicles and IoT will benefit from Open-RAN deployed at the network edge, support network slicing use cases efficiently, and allow secure and efficient over-the-air firmware updates.
Asia Pacific accounts for a significant share of the Open Radio Access Network (O-RAN) market owing to booming investments in advanced entertainment systems for autonomous vehicles. In the wake of technological advancements, enterprises in this region are investing heavily in IoT and AI technologies. Furthermore, increasing number of initiatives from countries such as India, Japan, Korea, and others, is also expected to boost the market growth over the forecast period. The growth in this region can be attributed to the increasing demand for high speed and internet coupled with ongoing trends of cloud-based solutions. O-RAN, combined with cloud technologies, are being deployed in this region to facilitate more flexible network capabilities. Furthermore, the market is expected to expand owing to the growing implementation of 5G base stations, supported by increasing investments in research and development by many key players working in the telecommunications industry to develop an efficient O-RAN solution.
The global O-RAN market is segmented by components into hardware, software, and services. Out of these, the hardware segment is expected to hold the highest market share throughout the forecast period and further attain a revenue of USD 9895.88 Million by the end of 2028. The software segment on the other hand is expected to grow with the highest CAGR of 89.5% during the forecast period. Based on connectivity technology, the 4G LTE segment is estimated to garner the highest market revenue by the end of 2021 owing to the fact that O-RAN for 4G LTE follows the principle of COTS hardware material that ensures inter-operator transferability. Recently, multiple antenna technologies that aid multiple-input multiple-output (MIMO) have emerged that ensure better transmission and network stacking thus, reducing overall costs. Although, the 5G segment is expected to foresee the 4G LTE segment in the coming years by growing with the highest CAGR of 95.5% during the forecast period. Based on deployment location, the market is segmented into urban and rural. Out of these, the urban segment accounted for the highest share in 2020 and is further estimated to grow with the highest CAGR of 84.5% during the forecast period. The competitive pressure amongst telecom operators and the prioritization of urban landscapes are expected to boost the growth of the urban segment in the upcoming years.
Our report has covered detailed company profiling comprising company overview, business strategies, key product offerings, financial performance, key performance indicators, risk analysis, recent developments, regional presence, and SWOT analysis among other notable indicators for competitive positioning. Some of the prominent industry leaders in the global O-RAN market that are included in our report are Metaswitch Networks, Mavenir, NTT DOCOMO, INC., Sterlite Technologies Limited, Huawei Technologies Co., Ltd., Radisys Corporation, Casa Systems, VIAVI Solutions Inc., Parallel Wireless, Inc., NXP Semiconductors, and others. The report also includes key players who manufacture the radio units for O-RAN, namely Fujitsu Limited, NEC Corporation, Benetel Ltd., Comba Telecom Systems Holdings Ltd., and others. Further, players manufacturing fiber optics, wired & wireless components for O-RAN are ip.access Ltd., Altiostar, NTS Technology, and others.
FREQUENTLY ASKED QUESTIONS
The growing adoption of 5G technology in cellular network, along with the lower upfront capital deployment cost are the major factors responsible for the growth of the market.
The market is anticipated to attain a CAGR of 83.1% over the forecast period i.e., 2020-2028.
The carrier grade scalability and the system integration complexity are estimated to act as barriers to the market growth.
Asia Pacific is estimated to create notable growth opportunities for market growth over the forecast period.
The major players in the market are Metaswitch Networks, Mavenir, NTT DOCOMO, INC., Sterlite Technologies Limited, Huawei Technologies Co., Ltd., Radisys Corporation, Casa Systems, NXP Semiconductors, and others.
The company profiles are selected based on the revenues generated from the product segment, geographical presence of the company which determine the revenue generating capacity as well as the new products being launched into the market by the company.
The market is segmented by component, connectivity technology, deployment location, end-use vertical, and by region.
The 4G LTE segment is anticipated to hold largest market size in value and is estimated to display significant growth opportunities.
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