5G Market Outlook to 2025 - Comprehensive Global Analysis and Projections by Networking Infrastructure and Industry Sector
Telecommunication providers worldwide have recognized the urgent necessity for a complete transformation of their current network frameworks. The rapid increase in the number of connected devices has demonstrated that existing infrastructures are inadequate for managing the escalating data traffic. As data traffic continues to rise, ensuring a high quality of service (QoS) for end-users has become a crucial consideration for these operators. Intense competition for subscribers, coupled with shrinking profit margins, has led to declining revenues for telecom companies, putting the industry at risk of significant downturns, a situation that became apparent around two years ago. The deployment of 4G LTE networks did not yield the expected financial returns for many operators, resulting in losses for some. In response to this challenging environment, the International Telecommunications Union, in collaboration with various stakeholders, proposed a new network architecture designed to meet modern demands. This initiative led to the establishment of Release 15 and Release 16, which are now recognized as the foundational standards for wireless telecommunications, commonly referred to as 5G. The 5G market in North America, particularly within the industrial automation sector, is projected to grow at a compound annual growth rate (CAGR) of 48.65%, reaching an estimated US$ 1.25 billion by 2025, up from US$ 0.17 billion in 2020.
The potential of the new 5G architecture extends beyond the telecommunications sector, impacting various industry verticals. The industrial automation sector is poised to be one of the primary beneficiaries of 5G technology in the near future. North America, recognized as a technological and manufacturing powerhouse, is expected to experience significant advancements as 5G technology is integrated into industrial automation processes. Notable applications of 5G in manufacturing include cell automation, where devices on assembly lines and control units communicate wirelessly; the use of Automated Guided Vehicles (AGVs) for transporting goods within factories; process automation; remote assistance and robotic control for tasks such as measurement and excavation; and the implementation of augmented reality (AR) for staff training and maintenance.
In our analysis, we have categorized the 5G market based on networking infrastructure and industry verticals. The networking infrastructure segment encompasses small cells, macro cells, and other related components. While 5G technology finds applications across various business scenarios, the industry vertical segment includes sectors such as smart automotive, healthcare, smart transportation, consumer electronics, industrial automation, building and home automation, among others. Geographically, the 5G market is examined across regions including North America, Europe, Asia-Pacific (APAC), the Middle East and Africa (MEA), and South America (SAM).
Initially, North America is projected to hold the largest market share in the 5G infrastructure sector in 2020, driven by a significant increase in 5G trials, government backing, diverse business applications, and a conducive ecosystem of industries. The governments of the United States, Canada, and Mexico are actively engaging in initiatives to facilitate the rollout and deployment of 5G technology throughout the region, collaborating with various stakeholders such as chipset manufacturers, mobile network operators (MNOs), device manufacturers, and technology providers. These collaborative efforts are expected to further accelerate the deployment of 5G across North America. Key players in the 5G market are strategically positioning themselves to capitalize on opportunities in emerging markets. Prominent companies in the 5G landscape include T-Mobile USA, Inc., Cisco Systems, Inc., AT&T, Inc., Qualcomm, Inc., Ericsson, Huawei Technologies Co. Ltd., Verizon Communications, Inc., Nokia Networks, Telefonica S.A., and Orange S.A.