Network Equipment Market Size, Share & Trends Analysis Report By Component (Hardware, Software, Services), By Connectivity (2G/3G, 4G LTE, 5G), By Network Type, By End-user, By Region, And Segment Forecasts, 2022 - 2030

Report Overview

The global network equipment market size was valued at USD 142.70 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 3.5% from 2022 to 2030. The network equipment comprises the set of components used for setting up the network infrastructure. The market consists of network equipment hardware, software, and related services. The rising deployment of  Internet of Things (IoT) enabled devices across commercial, consumer, and industrial infrastructure is one of the leading factors driving demand for network equipment. The advent of 5G technology is anticipated to further augment the adoption of connected devices across organizations to extract relevant information from business data.

Furthermore, the resultant increase in the penetration of smart and connected devices is positively impacting the growth of the market. Additionally, many enterprise customers are updating their network equipment infrastructure to improve the security of their networks and ensure more efficient data exchange. Several enterprise businesses are heavily investing in creating a smart office environment by embracing technologies such as Machine Learning (ML), Augmented/Virtual Reality (AR/VR), and edge computing.

The rising investments in the network equipment infrastructure and solutions by telecom operators and service providers are fueling the market growth. Telecom operators and service providers including Cisco Systems, Inc. and Telefonaktiebolaget LM Ericsson are introducing advanced solutions to implement new infrastructure or upgrade the existing infrastructure of customers and businesses demanding high data speed data capacity. For instance, in January 2022, Cisco Systems, Inc. announced the expansion of its enterprise-grade switching capabilities to secure and modernize critical infrastructure within industrial networks. Such developments are expected to propel the market’s growth.

Additionally, the adoption of advanced technologies across enterprises has encouraged several organizations to adopt next-generation 5G network equipment and software. 5G-enabled network infrastructure and software applications can deliver organizations a competitive advantage by ensuring quick service and support delivery to their customers. In addition, 5G-enabled networks allow organizations to improve their operational efficiency and increase the overall client base. To achieve enhanced bandwidth coverage and capacity, enterprises are increasingly integrating their existing legacy on-premises infrastructure and software applications with the 5G technology.

However, the lack of technological advancements and poor operational efficiencies in developing nations such as India and China are anticipated to hinder the growth of the market over the forecast period. On the other hand, the robust deployment of network equipment infrastructure across smart cities such as the U.S., Canada, and the U.K. are expected to provide lucrative opportunities for the growth of the industry. For instance, BT Group, a telecommunications service provider announced a strategic partnership with Telefonaktiebolaget LM Ericsson to establish 4G/5G networks across major business and industrial hubs across the U.K., such as the Port of Tyne.

COVID-19 Impact Analysis

The COVID-19 pandemic significantly affected the global economy and, subsequently, 5G infrastructure roll-out and deployment plans. For instance, according to data released by the International Monetary Fund (IMF) in October 2021, the global GDP was reduced by a rate of -3.1% in 2020 due to COVID-19. Governments across several countries implemented complete/strict lockdowns during the first two quarters of 2020 to stop the spread of the virus. Several key manufacturers across the globe temporarily shut their facilities to prevent the spread of the virus.

Component Insights

The hardware segment dominated the market in 2021 and accounted for a share of more than 57% of the global revenue. The growth of the segment can be attributed to the growing deployment of network hardware and core equipment across several use cases. Some of these use cases include enterprises, remote surgeries, industrial robotics, autonomous vehicles, wireless cameras, and smart cities. Moreover, emerging RAN services, core network services, and fixed access hardware components are also driving the growth of the hardware segment.

The software segment is anticipated to witness significant growth over the forecast period. The software segment includes the aggregate revenue generated from implementing on-premises and cloud-based software solutions for the RAN, core network, and fixed access. The segment covers infrastructure software (including the network infrastructure management software), Operations Support System (OSS)/Business Support System (BSS), and other software (including application software).

Connectivity Insights

The 4G LTE segment dominated the market in 2021 and accounted for a share of more than 72% of the global revenue. The Voice over Long-term Evolution (VoLTE) technology uses 4G/LTE to transmit data and route voice traffic. Additionally, 4G enables faster access to applications and content, lower latency, and the latest converging services based on multimedia subsystems with unified protocols and architectures.

The 5G segment is expected to register the fastest growth over the forecast period. The improved efficiency and higher performance offered by 5G can potentially empower exceptional user experiences and interfaces. Hence, creating several innovative use cases for several industry verticals such as automotive, retail, and education among others. Such enhancements are pursued by various industry verticals to gain a competitive edge and are expected to drive the growth of the segment.

Network Type Insights

The public segment dominated the industry in 2021 and accounted for a share of 67% of the global revenue. The growth of the segment can be attributed to upcoming smart city projects across the globe. For instance, in May 2020 the city of Hong Kong announced a subsidy plan to encourage the early deployment of 5G across the Hong Kong region. Such initiatives are expected to fuel the demand for public networks thereby contributing to the growth of the industry.

The private segment is anticipated to emerge as the fastest-growing segment over the projected period. A private network has network settings configured within the network routers and access points to restrict access to devices outside the network. Network equipment deployed within a private network infrastructure also comprises physical and virtual devices, such as access points, bridges, hubs, modems, gateways, routers, and switches. The growing adoption of enhanced security of the network enables the adoption of private network equipment by enterprises.

End-user Insights

The telecom operators segment accounted for the largest revenue share of over 61.0% in 2021. Telecom operators deploy network equipment and infrastructure to deliver telecommunication services, such as telephone services, data communication, and computer networking, based on a wide range of communication technologies, including microwaves. To cater to the high demand from this source, prominent network equipment providers are providing telecom operators with specialized networking services that utilize private networks incorporating LTE and 5G network connectivity. Such factors are also driving segment growth. 

The enterprise segment is anticipated to grow at a promising CAGR over the forecast period. Network equipment utilized in enterprise networks includes routers, switches, cloud management networking devices, and network security devices. Network switches, gateways, routers, hubs, and modems may also be included according to the changing end-user requirements. Network equipment providers also offer enterprise-level networking equipment to ensure the safety of network functions. The enterprises demand the high security of the networks which enables the adoption of private network equipment across the enterprises.

Regional Insights

Asia Pacific accounted for the largest revenue share of over 34% in 2021. The growth of the region is attributed owing to the high penetration of next-generation network equipment and infrastructure owing to the region’s tendency to adopt new technologies.

For instance, in April 2022, during the Huawei Global Analyst Summit (HAS) 2022, Huawei Technologies Co., Ltd. announced that it would investigate uplink spectrum reconstruction, ultra-high bandwidth, green air interfaces, ELAA-MM, and native intelligence to assist operators in building '1+1+N' 5.5G networks and upgrading network capabilities. Such developments across the region are expected to maintain the dominance of the Asia Pacific region.

Key Companies & Market Share Insights

To maintain their position, leading vendors frequently engage in strategies such as mergers and acquisitions, new product launches, and others. In April 2022, Ericsson and Turkcell announced a collaboration for the digitalization of industries using Ericsson's Private Network technology. Through a dedicated, on-premise Ericsson Private Networks solution, Ericsson assisted Turkcell in identifying and analyzing prospective use cases for potential engagement possibilities in sectors. Some prominent participants in the global network equipment market include:

• Telefonaktiebolaget LM Ericsson

• Nokia Corporation

• Samsung Electronics Co., Ltd.

• ZTE Corporation

• Juniper Networks, Inc.

• Huawei Technologies Co., Ltd.

• Cisco Systems, Inc.

• Hewlett Packard Enterprise Development LP

• Broadcom

• ALE International (Alcatel-Lucent)

Network Equipment Market Report Scope

Global Network Equipment Market Segmentation

The report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global network equipment market report based on component, connectivity, network type, end-user, and region:

• Component Outlook (Revenue, USD Million, 2017 - 2030)

  • Hardware

    • RAN

    • Core Network

    • Fixed Access

    • Others

  • Software

    • Infrastructure Software

    • OSS/BSS

    • Others

  • Services

    • Professional Services

      • Advisory/Consulting

      • Design / Optimization

      • Tools & Automation

      • Security

    • Deployment Services

      • Testing

      • Installation

      • Integration

    • Managed Services

      • Network Performance And Management

      • App / Data Management

      • RAN Operation Support

      • Core Operation Support

      • Security

      • Training

• Connectivity Outlook (Revenue, USD Million, 2017 - 2030)

  • 2G/3G

  • 4G LTE

  • 5G

• Network Type Outlook (Revenue, USD Million, 2017 - 2030)

  • Public Network

  • Private Network

• End-user Outlook (Revenue, USD Million, 2017 - 2030)

  • Telecom Operators

  • Enterprises

    • Public Safety

    • Healthcare

    • Retail And E-commerce

    • Banking, Financial Services, & Insurance

    • Government & Defense

    • Manufacturing

    • Others

• Regional Outlook (Revenue, USD Million, 2017 - 2030)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

    • France

  • Asia Pacific

    • India

    • China

    • Japan

  • Latin America

    • Brazil

    • Mexico

  • MEA