RAN market loses steam in first half of 2022: Dell’Oro

The positive momentum around the Radio Access Network (RAN) market over the past four years is losing some steam, according to Dell’Oro Group.

The market research firm reports that the overall 2G-5G RAN infrastructure equipment market, including hardware and software, declined in the second quarter, recording the first year-over-year reduction in more than two years and the third consecutive quarter of RAN coming in below expectations.

And it doesn’t look like deteriorating macro conditions, high levels of inflation and supply chain disruptions are the culprit here.

Instead, Dell’Oro attributes the weaker-than-expected results to regional development in the region it calls Asia Pacific (APAC), excluding China. RAN revenues in APAC – excluding China – declined at a double-digit rate, reflecting challenging conditions in Japan and spectrum auctions in India, according to Dell’Oro Group VP Stefan Pongratz.

Supplier exits, like those by Ericsson and Nokia, also weighed in on the Russian RAN market in the second quarter, he noted. 

“More generally, the RAN market has been performing well now for four consecutive years since the upswing began in the second half of 2018 so expectations were already more muted going into 2022,” he told Fierce. “But the developments in the first half were still a bit softer than anticipated.”

Slower momentum is not a sign that the 5G deployment phase is over, he said in a statement. “The message we have communicated for some time now, namely that the 5G cycle will be longer than previous technology cycles, still holds,” he said.

Here are some other highlights from the 2Q 2022 RAN report:

  • The top five global suppliers in the quarter – no surprise here – include Huawei, Ericsson, Nokia, ZTE and Samsung.
  • The top four suppliers outside of China in the quarter include Ericsson, Nokia, Huawei and Samsung.
  • Huawei and ZTE continued to dominate in China, together accounting for 90-95% of revenues in the first half of 2022.
  • Ericsson maintained its hold on the RAN market outside of China, accounting for 39% of the revenues for the first half of the year.
  • Even though RAN results disappointed in the quarter and first half revenues are tracking below expectations, RAN is still projected to record a fifth consecutive year of growth in 2022.