Written by Nick Wood
There is one bright spot amid all the doom and gloom about lower telco capex and its effect on vendor earnings.
The market for private cellular networking equipment saw revenues in the second quarter jump 60% year-on-year, according to Dell’Oro.
The research firm was at pains to point out that private networking is only a small part of the overall RAN market. In February, it predicted that cumulative spending on LTE/5G small cells for private networking will reach $1 billion by 2027. Admittedly that forecast doesn’t include macro cells deployed in private networks, but even if it did, it is highly likely the figure would still be a drop in the ocean compared to the tens of billions that are typically spent on RAN equipment every year.
Nonetheless, the likes of Ericsson and Nokia are under pressure to tap new sources of revenue growth as telcos, led by those in the US, rein in their macro RAN capex. The private networking market, irrespective of its relative size, is still a growth area.
Indeed, Dell’Oro expects total private wireless RAN revenues to grow at a 24% CAGR between 2022 and 2027, while public RAN revenues are set to decline at a 2% CAGR over the same time period.
