FWA, private wireless can’t revive RAN market

The Radio Access Network (RAN) has been in a downward spiral and the prospects of it coming back to life anytime soon are close to nil, according to the latest market forecast by Dell’Oro Group.

Even fixed wireless access (FWA) and private wireless – two areas showing promise in the 5G era – aren’t enough to keep the RAN market from sinking.

“The big picture has not changed,” said Dell’Oro Group VP Stefan Pongratz in a statement. Mobile broadband (MBB)-based investments “are now slowing and the upside with new growth areas including FWA and private wireless is still too small to change the trajectory.”

In addition, “weighing on the MBB market is the fact that the upper mid-band capacity boost is rather significant relative to current data traffic growth rates in some markets, which could impact the timing for capacity upgrades,” he said. 

It’s not exactly coming out of the blue. Analysts have been painting a grim picture for the RAN market for at least the past year. Last February, Mobile Experts released a report that said 5G RAN investments will decline over the next few years until 6G ramps up.

It follows the usual pattern whenever the industry deploys a new generation of wireless technology – once the initial deployments are done, there’s a decline in capex spending and a reduction in the RAN  market.

According to Dell’Oro Group, the RAN market rose between 2017 and 2021 before revenues stabilized in 2022. Then in 2023, RAN revenues took a steep turn downward.

Market conditions are expected to remain challenging in 2024 as the RAN market in India pulls back, although the pace of the global decline this year and for the remainder of the forecast period should be more moderate, Dell’Oro said.

Here are some other data points from Dell’Oro’s mobile RAN 5-year forecast report:

• Worldwide RAN revenues are projected to decline at a 1% compound annual growth rate (CAGR) over the next five years.
• The Asia Pacific region will lead the decline while growth prospects in the North America region will improve.
• 5G Advanced is expected to play an important role in the broader 5G journey; however, it’s not likely to fuel another major capex growth cycle.
• RAN segments that are expected to grow over the next five years include: 5G NR, FWA, millimeter wave, Massive MIMO, open RAN, private wireless, small cells and Virtualized RAN.