5G base station Market Size & Overview:

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5G base station Market Size was valued at USD 31.7 Billion in 2023 and is expected to reach USD 340.3 Billion by 2032, growing at a CAGR of 30.2% over the forecast period 2024-2032.

The 5G base station market is expanding at an impressive rate, largely due to the rising investment by governments and telecom operators in upgrading network infrastructure. For instance, the U.S. government, according to the Federal Communications Commission, allocated approximately $9 billion to facilitate the expansion of 5G networks, and additional funding has been proposed to support the deployment of rural broadband. With this financial backing, the mass deployment of 5G is expected, a technology that is likely to enhance mobile connectivity and support different applications, including the Internet of Things, autonomous vehicles, and smart cities. There are policies supported by governments that encourage digitization and technological growth, which is likely to create a conducive environment for the development of 5G infrastructure. Finally, the global recognition of 5G superiority by nations is shaping a future where deployment is realized in time, implying that the 5G base station market will continue growing.

Furthermore, the telecommunication industry is in the early stages of implementing the 5G technology, whose benefits include faster data speeds, low latency, and improved network performance. With the increasing uptake of data-intensive applications and services by consumers and businesses, the need for high-speed video and data is imminent. 5G works better in that it can transport massive data volumes more quickly than 4G LTE. Since it operates at reduced latency, the connection is more robust, and devices can achieve faster speeds even when they switch. Additionally, IT and telecom companies are commercializing higher-band spectrums that offer more bandwidth and capacity, promoting better mobile internet experience by consumers and businesses.

5G base station Market dynamics

Drivers:

• The ongoing global rollout of 5G networks has spurred massive demand for 5G base stations, particularly in urban areas to ensure ultra-fast data transmission and low latency.

• Increasing deployment of IoT devices and smart city infrastructures requires a robust 5G network to manage the surge in connected devices.

• Rising interest in edge computing accelerates the need for 5G base stations to support real-time data processing closer to the user, improving efficiency and reducing latency.

The major drivers for the 5G base station market growth are the IoT and Smart city growth. High demand for 5G communication is an essential part of IoT and Smart cities, which are needed to transmit data rapidly and reliably in real-time. All smart applications in Smart cities need 5G, such as smart lighting systems, real-time environmental monitoring, and smart management of traffic. For instance, the number of IoT-connected devices around the world is projected to surge to over 29 billion overall worldwide by 2030. All these devices need 5G networks for high data transfer speeds ultra-low latency and high capacity provided by 5G, which is impossible in the case of 4G. More importantly, by 2050, approx. 50% of the world’s population is expected to live in smart cities. This will dramatically drive the development of efficient communication systems based on 5G communication that will help to manage smart applications in these cities, including healthcare, transport, public safety, and such.

Additionally, there are evident trends of smart cities in many countries in the world today with ambitious plans for the support of IoT. For instance, in China, there are over 500 smart city pilot projects that are being implemented nowadays. While in Singapore, the number of smart city innovations continues to grow as the country’s government works to reach its Smart Nation goal. Hence, this evolution puts an emphasis on the key role 5G stations play in enabling IoT networks inside the cities. This is essential for the real-time work of all connected devices that exchange data quickly, making all urban infrastructures work smoothly. Overall, the expansion and growth of the number of smart cities in the world will encourage the expansion in the demand for 5G base stations.

Restraints:

• The substantial investment required for 5G base station deployment, including infrastructure and spectrum costs, remains a significant barrier to widespread adoption.

• Complex regulatory policies and the limited availability of 5G spectrum across regions are slowing down the deployment pace, especially in developing countries.

One of the significant restraints in the 5G base station market is the high deployment costs. Building 5G infrastructure requires a substantial financial investment, especially in the case of network operators and service providers. 5G operates on much higher frequency bands than previous generations, using millimeter waves that transmit data over short distances. As such, creating a network that manages to cover enough ground, particularly in urban areas, requires the installation of a higher density of base stations. While the high number would be enough to make deployment expensive, each of the base stations would also come with associated operational costs, the most significant of which would be energy usage. A further cost would come from the need to upgrade the infrastructure behind the stations, including fiber optic backhaul and various advanced antennas and network equipment. Each base station requires a separate connection beyond the current bands, companies need to spend significant amounts of money to purchase licenses allowing them to operate on a wide range of frequency bands, which are also auctioned by the government at a premium. Undoubtedly, the combined costs can be high enough to make operators hold back on rolling out 5G base stations, particularly in the case of less profitable and rural areas where the return on investment will be slower.

5G base station Market Segment Analysis

By component

The hardware segment led the 5G base station market in 2023, with a 65% revenue share. This leading position can be explained by the crucial role of hardware components, including antennas, transceivers, and radio units. They deliver 5G network performance and robustness. Moreover, these data were also confirmed by the International Telecommunication Union, which published 5G technology standards. Approximately 50% of the total investment in 5G was made in hardware equipment, and this fact also proves the importance of this segment. At the same time, there is a rise in customer demand for high-capacity network instruments since over the past two years, global average data traffic has more than doubled. Nevertheless, this trend also increases the level of competition among telecommunication companies. In response to the government’s requirements to implement 5G coverage on national levels, these companies must invest in hardware products to ensure their compatibility with new standards. The rapid proliferation of smart devices and IoT applications further drives the demand for high-performance hardware capable of supporting massive data exchange. Overall, they demand more and more advanced hardware that can support the prolific exchange of data and, therefore, these tools will still remain a focal point in the telecommunications companies’ growth strategy.

By core network

The software-defined networking (SDN) segment had the highest revenue share in the market in 2023. This can be attributed to the growing importance of network flexibility and management characteristics in 5G networks. As per the National Institute of Standards and Technology, offering the report on SDN, organizations adopting this technology can expect approximately a 30% reduction in operational expenditure simultaneously enhancing the performance of networks. This significant reduction in the cost of operation helps in achieving the target of telecommunication organizations that want to ensure improved functions with minimum cost.

The Network function virtualization segment is expected to have a high growth from 2024 to 2032 supported by the need to have network architectures that are flexible and can be scaled. As the data traffic and its demands grow, telecom providers adopt NFV solutions that provide the capability of running network functions by deploying them. This helps in increasing the efficiency of companies and keeping the capital expenditure low at the same time. The governmental help in the form of grants and subsidies in the adoption of these technologies and the development of the telecommunication infrastructure will support both the SDN and NFV segments to grow in the future.

By Network Architecture

The 5G non-standalone NSA segment held the largest market revenue share in 2023. The NSA architecture offers operators the flexibility to make use of their existing 4G LTE infrastructure and gear them up for the 5G network. This infrastructure is one of the most successful strategies used across various regions for quick deployment. The Global Mobile Suppliers Association reported that nearly 60% of the 5G networks launched across the globe in 2023 were supported by the NSA architecture. Many other mobile network companies across various regions are successfully running on this model for a faster deployment rate. They are provided the option to use the existing infrastructure while offering the 5G services. Governments have reported that countries employing the NSA model have reported a 20% quicker deployment of 5G networks by taking these networks live. As operators continue to explore options for efficient network deployment, the NSA segment is expected to maintain its significant market share through 2024, ensuring a smoother transition to fully standalone 5G networks.

Regional Market Analysis

The Asia-Pacific region dominated the 5G base station market in 2023, capturing the largest share. The investment in 5G infrastructure and the rapid deployment by key countries such as China, Japan, and South Korea, fuelled the region’s dominance. According to the government source, China accounted for more than 60% of the global 5G base station installations. The state-backed initiative and aggressive rollouts of giant telecoms, China Mobile, China Telecom, and China Unicom, were the key drivers for the large-scale deployment of 5G base stations in China. By the end of 2023, China had more than 2.9 million 5G base stations, marking a 32% YoY increase. As a result. China became a leader in the APAC region. In addition, the market’s drive to develop smart cities, IoT applications, and industrial automation was another factor contributing to the dominance of the APAC region and it is expected to maintain its leading position over the forecast period in the global 5G base station market.

Also, North America accounted for a significant share of the 5G base station market. The solid investment by telecommunication operators and a supportive regulatory environment introduced by the U.S. government were the primary reasons for the dominating position. The FCC’s “5G Fast Plan” focuses on deploying 5G infrastructure faster and promoting competitive access to 5G spectrum. Moreover, Verizon and AT&T have drastically improved and deployed 5G infrastructure for urban and rural areas, which further contributes to North America’s leadership position. In addition, the transition of consumer demand and 5G applications, including smart cities and connected vehicles, are other growth aspects in the North American region. The government’s continued interest in promoting broadband development and digital innovation is expected to sustain the leading position of North America in the global 5G base station market.

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Key Players

• Huawei Technologies Co., Ltd. (5G RRU, 5G gNodeB)

• Ericsson (Ericsson Radio System, Massive MIMO AIR 6488)

• Nokia Corporation (AirScale Base Station, ReefShark)

• ZTE Corporation (ZXR10 M6000-S, 5G RAN)

• Samsung Electronics Co., Ltd. (Compact Macro, 5G vRAN)

• Fujitsu Limited (5G vRAN, 5G Baseband Unit)

• NEC Corporation (5G Base Station Equipment, Open RAN)

• Qualcomm Technologies, Inc. (FSM100xx 5G Platform, Snapdragon X65)

• Cisco Systems, Inc. (Cisco Cloud RAN, Cisco 5G Infrastructure)

• NVIDIA Corporation (A100 Tensor Core GPU, EGX Platform)

• Intel Corporation (FlexRAN, Atom P5900)

• CommScope (OneCell, Mosaic)

• Juniper Networks, Inc. (5G RAN Solutions, Open RAN Transport Solutions)

• VMware, Inc. (Telco Cloud Platform, 5G vRAN)

• Xilinx, Inc. (Versal AI Core, RFSoC DFE)

• Parallel Wireless, Inc. (OpenRAN, All-G Cloud-Native RAN)

• Mavenir Systems, Inc. (Open RAN vRAN, Cloud-Native 5G Core)

• Keysight Technologies (5G Network Emulation Solutions, Open RAN Architect)

• Altiostar Networks, Inc. (Open vRAN, 5G Radio Access Network)

• Casa Systems, Inc. (Axyom vRAN, 5G Core) and others

Recent Development

March 2024: The Federal Communications Commission (FCC) announced an additional $3 billion in funding for rural 5G deployments, aimed at bridging the digital divide in underserved areas.

In March 2024, The Federal Communications Commission announced an additional $3 billion in funding for rural 5G deployments. This effort is part of the goal to close the digital divide in underserved areas.

In February 2024, The U.S. Department of Commerce released a report on policy for 5G infrastructure investments, which led to a 15% increase in job creation in the telecommunications sector.

In January 2024, the National Telecommunications and Information Administration released a white paper on the economic impact of 5G, which asserts that the technology could contribute $500 billion to the U.S. economy by the end of the decade.