Fewer new subscribers mean the sector’s growth worldwide will have a CAGR of just 1% over the next five years
A new report by Dell’Oro Group yet again forecasts slower than expected growth in the market for mobile core networks. The analyst house is predicting just 1% compound annual growth rate over the next five years – half what it forecast in January.
Further, while revenue growth rates are projected to be flat in 2026, Dell’Oro expects them to “turn negative in 2027”.
Europe, the Middle East and Africa, along with the Asia-Pacific region excluding China, are expected to have the highest positive CAGRs, while China and North America will be the worst hit.
Revised down thrice
“We have reduced our forecast for the third consecutive time, primarily caused, this time, by an expected slowdown in subscriber growth,” said Dave Bolan, Research Director at Dell’Oro Group.
“Also, we reduced our projections for the Multi-access Edge Computing (MEC) market to a 31% CAGR as commercially viable enterprise applications are taking much longer to realize than earlier hoped.
He added, “Mobile network operators (MNOs) are concerned about inflation, a possible recession and political conflicts. They are therefore being restrained in their capital expenditures, another factor weighing in on a more conservative forecast.”
Slower than 2022
“As we continue refining our count of MNOs that have launched 5G Standalone (5G SA) eMMB [enhanced mobile broadband] networks, we note that only four…have commercially deployed new 5G SA networks compared to six in the first half of 2022,” Bolan stated.