Private wireless is not materializing as fast as initially expected, leading Dell’Oro Group to again revise its projections downward. This time the primary source is the traditional wide-area private wireless segments. On the bright side, private small cell RAN revenue projections remain on track to surpass $1 B by 2027.
“Even with revenues coming in below expectations, our long-term position remains unchanged – we still firmly believe that private wireless is a massive opportunity,” said Stefan Pongratz, Vice President at Dell’Oro Group. “At the same time, market opportunity is not the same as a forecast and given the current progress, it will clearly take some time for the private wireless market to reach its full potential. In fact, our current forecast is for private wireless to reach roughly 10 percent of its potential by 2027,” continued Pongratz.
Additional highlights from the Private Wireless Advanced Research Report:
- Total private wireless RAN revenues – including wide-area (traditional and new) and small cells – are projected to grow at a 24 percent CAGR between 2022 and 2027. For reference, public RAN (Total RAN minus private RAN) is projected to decline at a 2 percent CAGR over the same time period.
- 5G is dominating in China while LTE is currently dominating outside of China – 5G NR is projected to surpass LTE by 2026.
- Preliminary findings suggest the largest public RAN suppliers, including Huawei, Ericsson, and Nokia, are well positioned in this initial private LTE/5G phase. Meanwhile, enterprises and operators appear more willing to try out non-traditional RAN suppliers in some private wireless settings.
- Risks are broadly balanced. On the upside, the 5G enterprise puzzle has still not been completely solved. The successful launch of private 5G services by suppliers with strong enterprise channels and/or the successful introduction of a new device could accelerate the demand for 5G in the enterprise. On the downside, 5G awareness is improving but it will take some time for enterprises to fully understand the value of private LTE/5G. Pricing also needs to evolve as the competitive landscape for turnkey solutions improve – some of the price points we see right now for 3- and 5-year leases run the risk of squelching penetration, especially in the mid-market Wi-Fi like segment.