Gartner expects 5G network spending to almost double in 2020
The analyst firm says rising competition among CSPs is responsible for the accelerating pace of 5G adoption
Spending is expected to reach $8.1 billion (£6.3 billion) this year, comprising 21.3% of total wireless infrastructure revenue. That number has doubled since last year, when investment by communications service providers (CSPs) in 5G network infrastructure was worth $4.1 billion (£3.2 billion) and accounted for 10.4% of total wireless infrastructure revenue.
According to Kosei Takiishi, senior research director at Gartner, “early 5G adopters are driving greater competition among CSPs”.
“Investment in wireless infrastructure continues to gain momentum, as a growing number of CSPs are prioritizing 5G projects by reusing current assets including radio spectrum bandwidths, base stations, core network and transport network, and transitioning LTE/4G spend to maintenance mode,” he said.
“In addition, governments and regulators are fostering mobile network development and betting that it will be a catalyst and multiplier for widespread economic growth across many industries.”
According to the research firm, the rising competition among CSPs is responsible for the accelerating pace of 5G adoption. It also predicts that CSPs in Greater China, Asia/Pacific, North America, and Japan will reach 5G coverage across 95% of national populations by 2023.
“Despite investment growth rates in 5G being slightly lower in 2020 due to the COVID-19 crisis (excluding Greater China and Japan), CSPs in all regions are quickly pivoting new and discretionary spend to build out the 5G network and 5G as a platform,” said Takiishi.
Gartner also predicts that Greater China will continue to be a global leader in 5G development, with nearly half (49.4%) of all worldwide investment in 2020 attributed to the region.
Its success is credited to cost-effective infrastructure manufactured in the region, as well as state sponsorship and reduced regulatory barriers. The combination of the three contributes to major CSPs in China being able to quickly build 5G coverage.
IT Pro reached out to Gartner to enquire if recent developments surrounding Chinese tech giant Huawei, such as the decision to ban it from the UK’s 5G infrastructure, had influenced the predictions in any way. The firm has yet to respond to our request for comment.