A new report from SNS Research predicts 125% CAGR over the next three years on VRAN spending, with 5G a significant influence by 2020.
Forecasts on the expected increased use of virtualized platforms by telecommunication operators received further fuel from a recent report by SNS Research predicting global spending on virtualized radio access network infrastructure and software will hit $2.6 billion annually by 2020.
The report noted the market today was at a “nascent stage with most investment focused on virtualized small cells for targeted greenfield deployments and pilot engagements for macrocell coverage.” But, the market is expected to surge at a 125% compound annual growth rate over the next three years as mobile operators “realize the benefits of RAN virtualization.”
SNS noted the move towards running RAN aspects of a network in a virtualized environment as virtual network functions on top of commodity hardware can result in a reduction in total cost of ownership, increased performance and greater scalability.
The move was also seen as beneficial for mobile operators as they prepare for “5G” network upgrades, with SNS noting mobile operators are currently looking at multiple baseband functional split options for VRAN deployments to ease the network evolution transition and reduce fronthaul costs. The research firm said it expects around $900 million of all VRAN investments to be directed at 5G network plans by the end of 2020.
A number of operators and their vendor partners have begun trialing aspects of VRAN in lab environments as they prepare to support 5G deployments.
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