Omdia: Huawei increases global RAN market share due to China hegemony
Due to China’s enormous mobile network market (where foreign vendors are mostly shut out), Huawei remained the world’s largest vendor of radio access network (RAN) equipment – a market worth about $35 billion last year – according to Omdia (an Informa owned company). In 2023, the Chinese behemoth had a 31.3% share of the global RAN market. Omdia says Huawei’s market share was up by an unspecified amount in 2024, due to “a more favorable regional mix as well as market share gains in emerging markets,” according to Remy Pascal, principal analyst at Omdia.
Huawei recently reported a 22% increase in sales last year, to 860 billion Chinese yuan (US$ 118.6 billion), and it looks in better shape than its ailing western rivals. Its share of the global 5G networks market appears to have grown, according to the market research firm.
Omdia’s findings seems further to highlight the futility of U.S. sanctions against Huawei, originally imposed by Donald Trump in his first term as U.S. President and then expanded by President Joe Biden.
Image Credit: Huawei
China still lacks the ability to make the most advanced chips featuring the tiniest transistors. But technical workarounds or loopholes in trade rules have enabled Huawei to revive its smartphone business and remain competitive in networks. Late last year, telco executives who spoke on condition of anonymity said there had been no discernible impact on the quality of its products. And Ericsson continues to regard Huawei as its chief rival.
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“After two years of significant acceleration and exceptionally high investment in 2021 and 2022, and two years of steep decline in 2023 and 2024, Omdia expects 2025 to be a year of stabilization for the RAN market,” said Remy Pascal of Omdia. “Different regions will follow different trajectories, but at a global level, the market is expected to be flattish. North America has returned to growth in 2024 and we expect this to continue, we also expect a positive trajectory in some emerging markets.”
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Other results and forecasts from Omdia:
- The total global RAN market (which includes hardware and software but not services) was just over $35 billion last year, which represented a 12 percent decline on the previous year.
- There was a very slight drop in the aggregate market share of the top five RAN equipment vendors – Huawei, Ericsson, Nokia, ZTE and Samsung. In 2023, Omdia had that figure at about 95%. In 2024, it was roughly 94%.
- Ericsson was one of the main gainers last year thanks to its huge AT&T (non) OpenRAN contract.
- As a result, Nokia lost market share in the U.S., but claims that its global RAN footprint grew by 18,000 sites in 2024.
- Tejas Networks, an Indian RAN equipment vendor (not in the top five) that landed a large 4G contract with state-owned BSNL was another winner.
- Global RAN revenue will be “essentially flat” this year and marked by “low single digit percentage growth” outside China.
- A “positive trajectory” in emerging Asian markets as well as Africa, the Middle East and Latin America is forecast. Europe risks falling behind other parts of the world in mobile network markets.
Top RAN vendors, full year 2024 RAN revenue:
|
Global |
Global ex-China |
|---|---|
|
Huawei |
Ericsson |
|
Ericsson |
Nokia |
|
Nokia |
Huawei |
|
ZTE |
Samsung |
|
Samsung |
ZTE |
Top RAN vendors, full year 2024 RAN revenue, top 3 by region:
|
North America |
Asia & Oceania |
Europe |
Middle East and Africa |
Latin America & the Caribbean |
|---|---|---|---|---|
|
Ericsson |
Huawei |
Ericsson |
Huawei |
Huawei |
|
Nokia |
ZTE |
Nokia |
Nokia |
Ericsson |
|
Samsung |
Ericsson |
Huawei |
Ericsson |
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Dell’Oro Group’s most recent RAN report a few weeks ago stated that the global RAN market is expected to improve slightly over the short term, but the long-term outlook remains subdued. “The underlying message we have communicated for some time has not changed,” said Stefan Pongratz, Vice President for RAN market research at Dell’Oro Group. “Regional imbalances will impact the market dynamics over the short term while the long-term trajectory remains flat. This is predicated on the assumption that new RAN revenue streams from private wireless and FWA, taken together with MBB-based capacity growth, are not enough to offset slower MBB coverage-based capex,” said Dell’Oro’s Stefan Pongratz.
References:
https://www.lightreading.com/5g/huawei-defies-us-to-grow-market-share-as-ran-decline-ends-omdia
RAN Equipment Market to Remain Uninspiring, According to Dell’Oro Group
Network equipment vendors increase R&D; shift focus as 0% RAN market growth forecast for next 5 years!
Telco spending on RAN infrastructure continues to decline as does mobile traffic growth
vRAN market disappoints – just like OpenRAN and mobile 5G
Mobile Experts: Open RAN market drops 83% in 2024 as legacy carriers prefer single vendor solutions
ITU-R WP 5D reports on: IMT-2030 (“6G”) Minimum Technology Performance Requirements; Evaluation Criteria & Methodology
At its ITU-R WP5D February 2025 meeting, a large number of ITU-R WP 5D contributions were discussed on the development of a draft document titled, “Minimum technical performance requirements (TPRs) for IMT‑2030 (“6G”) radio interface(s) [IMT-2030.TECH PERF REQ].”
This Report describes key requirements related to the minimum technical performance of IMT-2030 candidate radio interface technologies. It also provides the necessary background information about the individual requirements and the justification for the items and values chosen. Provision of such background information is needed for a broader understanding of the requirements. After discussion of the contributions, a preliminary list of minimum TPRs is created, and the working document is updated. In total eleven sessions were used including three Drafting Groups to address requirements related to artificial intelligence, energy efficiency and joint requirements. This Report is based on the ongoing development activities of external research and technology organizations. These key technical performance requirements are used in the development of Report IMT-2030.EVAL.
This WP5D meeting discussed contributions on “Evaluation criteria and methodology for IMT-2030″ [IMT-2030.EVAL] and updated the working document. The discussion focused on a number of subjects including test environments, mapping between TPR and test environments, and a high-level view of TPR evaluation methodologies.
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During 3GPP Technical Specification Group RAN’s meeting RAN#106, in Madrid on December 12th, an important 6G study item was approved. The study represents a significant milestone in 3GPP’s interactions with ITU on 6G technical performance requirements (TPRs) as future, deployment scenarios, requirements and potential directions of 6G radio access technologies are further identified and investigated in 3GPP. The 3GPP study item (Details in RP-243327) aims to investigate a candidate set of items for minimum TPRs based on the Recommendation ITU-R M.2160 and, where applicable, the associated target values and key assumptions for the identified minimum TPRs.
The outcome is expected to be shared by Liaison Statement with ITU-R WP5D and used as a baseline for the subsequent 6G study in RAN.
Expected Output and Time scale: A 38 series Technical Report ‘Study on 6G Scenarios and requirements’ scheduled for RAN#112 in June, 2026.
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References:
ITU-R: IMT-2030 (6G) Backgrounder and Envisioned Capabilities
ITU-R WP5D invites IMT-2030 RIT/SRIT contributions
NGMN issues ITU-R framework for IMT-2030 vs ITU-R WP5D Timeline for RIT/SRIT Standardization
IMT-2030 Technical Performance Requirements (TPR) from ITU-R WP5D
https://www.3gpp.org/news-events/3gpp-news/ran-6g-study1
Ericsson and e& (UAE) sign MoU for 6G collaboration vs ITU-R IMT-2030 framework
Cisco CEO sees great potential in AI data center connectivity, silicon, optics, and optical systems
It’s no surprise to IEEE Techblog readers that Cisco’s networking business – still its biggest unit, generating nearly half its total sales – reported <$6.9 billion in revenue for the three-month period ending in January (Cisco’s second fiscal quarter). That was down 3% compared with the same quarter the year before. For its first half year, networking sales dropped 14% year-over-year, to about $13.6 billion.
However, total second-quarter revenues grew 9% year-over-year, to just less than $14 billion, boosted by the Splunk (security company) acquisition in March 2024. Thanks to that deal, Cisco’s security revenues more than doubled for the first half, to about $4.1 billion. But net income fell 8%, to roughly $2.4 billion, due partly to higher costs for research and development, as well as sales and marketing expenses.
Cisco groused about an “inventory correction” as networking customers digested stock they had already bought, but that surely is not the case now as that inventory has been worked off by its customers (ISPs, telcos, enterprise & government end users). Cisco CFO Richard Scott Herren now says “The demand that we’re seeing today a function of extended lead times like we saw a couple of years ago. That’s not the case. Our lead times are not extending.”
Currently, Cisco firmly believes that Ethernet connectivity sales to owners of AI data centers is an “emerging opportunity.” That refers to Cisco’s data center switching solutions for “web-scale” and enterprise customer intra-data center communications. The company’s AI strategy is described here.
Image Courtesy of Cisco Systems
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AI investments “will lead to our networking equipment being combined with Nvidia GPUs, and that’s how we’ll accomplish that in the future,” CEO Chuck Robbins told industry analysts on a call to discuss second-quarter results, according to a Motley Fool transcript. “There’s so much change going on right now from a technology perspective that there’s both excitement about the opportunity, and candidly, there’s a little bit of fear of slowing down too much and letting your competition get too much ahead of you. So, we saw solid demand,” he said.
However, Cisco will face mighty competition in that space.
- Nokia is targeting the same opportunity and last month said it would spend an additional €100 million (US$104 million) on its Internet Protocol unit annually with the goal of generating another €1 billion ($1.04 billion) in data center revenues by 2028.
- Arista Networks is another rival in this market, selling high performance Ethernet switches to cloud service providers like Microsoft.
- Nvidia, whose $7 billion acquisition of Mellanox in 2019 gave it effective control of InfiniBand, an alternative to Ethernet that had represented the main option for connecting GPU clusters when analysts published research on the topic in August 2023. Just as important, the Mellanox division of Nvidia also is a leader in Ethernet connectivity within data centers as described in this IEEE Techblog post.
- Juniper Networks (being acquired by HPC) is also focusing on networking the AI data center as per a white paper you can download after filling out this form.
During the Q & A, Robbins elaborated: “On the $700 million in AI orders, it’s a combination of systems, silicon, optics, and optical systems. And I think if you break it down, it’s about half is in silicon and systems. And it continues to accelerate. And I’d say the teams have done a great job on the silicon front. We’ve invested heavily in more resources there. The team is running parallel development efforts for multiple chips that are staggered in their time frames. They’ve worked hard. They were increasing the yield, which is a positive thing. And so, we feel good about it, but it’s a combination of all those things that we’re selling to the customers.”
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Enterprise AI:
“What we’re seeing on the enterprise side relative to AI is it’s still — customers are still in the very early days, and they all realize they need to figure out exactly what their use cases are. We’re starting to see some spending though on specific AI-driven infrastructure. And we think as we get AI pods out there — we got Hyperfabric coming. We got AI defense coming.
We have Hypershield in the market. And we got this new DPU switch, they are all going to be a part of the infrastructure to support these AI applications. So, we’re beginning to see it happen, but I think it’s also really important to understand that as the enterprises leverage their private data, their proprietary data, and they’ll do some training on that and then they’ll run inference obviously against that. We believe that opportunity is an order of magnitude higher than what we’ve seen in training today. We’re going to continue to innovate and build capabilities to put ourselves in a better position to be a real beneficiary as this continues to accelerate. But as of today, we feel like we’re in pretty good shape.”
“If you look at AI defense with the AI Summit that we did recently, there’s — I think there’s about 20-some-odd customers who are interested in going to proof of concept with us right now on it. We had almost half the Fortune 100 there for that event. So, I feel good about where we are. It will turn into greater demand as we just continue to scale these products.”
Telco use of AI Edge Applications:
“We see some of the European network operators are looking at delivering AI as a service,” said Robbins. “We see a lot of them planning for AI edge applications that are sitting at the edge of their networks that they’re managing for customers.”
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Cisco raised its guidance and now expects revenues for the full year of between $56 billion and $56.5 billion, up from its earlier range of $55.3 billion to $56.3 billion.
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References:
https://www.cisco.com/site/uk/en/solutions/artificial-intelligence/index.html
https://www.juniper.net/content/dam/www/assets/white-papers/us/en/networking-the-ai-data-center.pdf
Nokia selects Intel’s Justin Hotard as new CEO to increase growth in IP networking and data center connections
Initiatives and Analysis: Nokia focuses on data centers as its top growth market
Nvidia enters Data Center Ethernet market with its Spectrum-X networking platform
Nokia selects Intel’s Justin Hotard as new CEO to increase growth in IP networking and data center connections
Nokia today announced that their President and Chief Executive Officer, Pekka Lundmark will be replaced on April 1st by 50 year old Justin Hotard who currently leads Intel’s Data Center & AI Group. Hotard joins Nokia with more than 25 years’ experience with global technology companies, driving innovation, technology leadership and delivering revenue growth. Prior to Intel, he held several leadership roles at large technology companies, including Hewlett Packard Enterprise (more below) and NCR Corporation. He will be based at Nokia’s headquarters in Espoo, Finland.
“Leading Nokia has been a privilege. When I returned to Nokia in 2020, I called it a homecoming, and it really has felt like one. I am proud of the work our brilliant team has done in re-establishing our technology leadership and competitiveness, and positioning the company for growth in data centers, private wireless and industrial edge, and defense. This is the right time for me to move on. I have led listed companies for more than two decades and although I do not plan to stop working, I want to move on from executive roles to work in a different capacity, such as a board professional. Justin is a great choice for Nokia and I look forward to working with him on a smooth transition,” said Nokia’s President and CEO Pekka Lundmark.
“I am delighted to welcome Justin to Nokia. He has a strong track record of accelerating growth in technology companies along with vast expertise in AI and data center markets, which are critical areas for Nokia’s future growth. In his previous positions, and throughout the selection process, he has demonstrated the strategic insight, vision, leadership and value creation mindset required for a CEO of Nokia,” said Sari Baldauf, Chair of Nokia’s Board of Directors.
“I am honored by the opportunity to lead Nokia, a global leader in connectivity with a unique heritage in technology. Networks are the backbone that power society and businesses, and enable generational technology shifts like the one we are currently experiencing in AI. I am excited to get started and look forward to continuing Nokia’s transformation journey to maximize its potential for growth and value creation,” said Justin Hotard.
Rumors started to swirl in September, after a report in the Financial Times newspaper, that Nokia was seeking a replacement for Lundmark, who by then had been its CEO for about four years. Nokia said in a statement: “The Board fully supports President and CEO Pekka Lundmark and is not undergoing a process to replace him.”
–>How seriously should the FT and all other media now take the company’s public statements?
Lundmark had told Nokia’s board months earlier, in the spring of 2024, that he would consider stepping down once “the repositioning of the business was in a more advanced stage.” This author certainly does not think that “advanced stage” has been reached yet. “The current CEO has not got to grips with the growth problem. The top line has not increased since the Alcatel-Lucent takeover,” said a shareholder.
Nokia’s share price is now only 10% of its peak $260 Billion valuation in 2000 peak (that’s a 90% decline in price over almost 25 years- buy and hold?). However, the company has gained almost 40% in the last year after operational improvements and signs that construction of AI data centers could be a significant growth opportunity for Nokia’s network infrastructure business group, its second-biggest unit. In his leaving video, Lundmark drew attention to the sales growth rate of 9% for the final quarter of 2024 and the operating margin of 19.1%, Nokia’s best in a decade.
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“We’re at the start of a super cycle with AI,” said Hotard. “One that I see [as] very similar to the one we saw a couple of decades ago with the internet. In these major market transitions new winners are created and incumbents either reinvent themselves or fail… My focus will be to accelerate the transformation journey.”
During the Nokia conference call Q&A Hotard was defensive to questions about his plans for the company. He did say that networking comes second only to compute hardware when it comes to share of AI datacenter investment and he looks forward to the completion of the $2.1 billion Infinera acquisition. “The hundreds of billions of dollars being invested in data centers today from a technology standpoint of course start with compute accelerators and GPUs [graphical processing units], but the second thing is the network and the connectivity and further it is not just the connectivity inside the data center but the connectivity across data centers,” said Hotard on today’s call. That implies an increased emphasis Nokia will place on optical networking within and between data centers.
Indeed, IP networking and data center connectivity are becoming a fast-growing part of Nokia’s network infrastructure unit that provides the connectivity inside those data centers, recently landing deals with Microsoft and UK-headquartered Nscale. The hoped-for return is an additional €1 billion ($1.03 billion) in revenues by 2028. The Infinera acquisition, announced in June 2024 and expected to be finalized in the next few weeks, is also partly a data center play, bolstering Nokia’s portfolio of optical networking assets.
On Nokia’s Q3 2024 earnings call in October, Lundmark said, “Across Nokia, we are investing to create new growth opportunities outside of our traditional communications service provider market. We see a significant opportunity to expand our presence in the data center market and are investing to broaden our product portfolio in IP Networks to better address this. There will be others as well, but that will be the number one. This is obviously in the very core of our strategy.” At that time, Lundmark said Nokia’s telco total addressable market (TAM) is €84 billion, while its data center total addressable market is currently at €20 billion. “I mean, telco TAM will never be a significant growth market,” he added to no one’s surprise.
On today’s call, Lundmark drew attention to its revival and strength when asked to compare Nokia with Ericsson. “Of course, we respect them as a competitor in radio networks. We are slightly behind them in terms of market share, but we have had great deal momentum recently – you’ll have seen some of the deal announcements – and, very importantly, the feedback we are receiving from our customers is that we are now fully competitive in terms of our portfolio.”
Justin Hotard, slated to be Nokia’s new boss on April 1, 2025
During the past year Hotard has headed up Intel’s Datacenter & AI Group. Prior to that he was at HPE for nine years heading up the High Performance Computing, AI & Labs group.
“Networks are the backbone that power society and businesses, and enable generational technology shifts like the one we are currently experiencing in AI. I am excited to get started and look forward to continuing Nokia’s transformation journey to maximize its potential for growth and value creation,” said Justin Hotard.
What will Hotard led Nokia’s future commitment be to a shrinking market for mobile networks? Revenues generated by the global mobile market are estimated to have fallen about $5 billion last year, to $35 billion, after a $5 billion drop in 2023, according to Omdia (an Informa owned market research firm), as network operators cut spending. But an exit would rid Nokia of a business still responsible for 40% of total sales just as smaller rivals appear to be struggling.
Nokia seems to value Hotard’s U.S. background and experience in the data center and AI market. “If you look at the market and look at the world, the U.S. is an important market for us and so that is one element we consider – experience from that technology business there,” said Sari Baldauf, Nokia’s chair, when asked on today’s call why an external candidate was preferred to an internal appointment.
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Telecoms.com Scott Bicheno offered his opinion: “Hotard reckons Nokia’s telco customer base gives it an advantage when it comes to AI datacenters, which are increasingly built near to sources of power, often in remote locations. So, while this does feel like a promising strategic pivot for Nokia, those telco customers might be worried about mobile being deprioritized as a consequence. The appointment of someone from a company with an appalling track record in that sector is unlikely to ease that concern.”
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References:
https://www.telecoms.com/ai/nokia-signals-a-move-away-from-mobile-and-europe-with-new-ceo
https://www.ft.com/content/5f086aee-91b9-421a-9f32-c33e67b1af7f
Initiatives and Analysis: Nokia focuses on data centers as its top growth market
Nokia to acquire Infinera for $2.3 billion, boosting optical network division size by 75%
Who will be the big bidders at upcoming FCC C-band and AWS auctions?
Under new chairman Brendan Carr, the U.S. Federal Communications Commission (FCC) plans to open up more C-band (3.98-4.2 GHz) spectrum for 5G, recalling a golden age of spectrum awards that brought in tens of billions of dollars. The first C-band auction, which drew to a close in early 2021, brought in a staggering US$94 billion. Verizon made headlines by shelling out $52.9 billion at the auction, including incentive payments and clearing costs, so naturally there is talk of whether it will look to repeat its performance in the next C-band sale. But until we have more information it’s all just speculation. “In 2020, the FCC conducted the most successful auction in history when it released 280 megahertz of mid-band spectrum in the C-band for 5G,” Carr wrote, in a blog post.
At its upcoming February 25, 2025 Open Commission Meeting, the FCC (among other things) will:
- Enhancing National Security Though the Auctioning of Spectrum Licenses
The Commission will consider a Notice of Proposed Rulemaking that would update 10 year-old AWS-3 service-specific competitive bidding rules to bring those rules in line with current practice as the first step in fulfilling the Commission’s statutory obligation to initiate an auction of licenses for the AWS-3 spectrum in the Commission’s inventory by June 23, 2026, under the Spectrum and Secure Technology and Innovation Act. (GN Docket Nos. 25-70, 25-71, 13-185) - Exploring New Uses for Mid-Band Spectrum in the Upper C-band
The Commission will consider a Notice of Inquiry exploring whether, and if so how, we could free up additional mid-band spectrum for new services in the Upper C-band to meet projected spectrum demand, spur economic growth, and advance American security interests. (GN Docket No. 25-59)
CTIA – the U.S. wireless industry’s primary trade group – quickly cheered the news: “We applaud Chairman Carr for his swift action in exploring how best to make the upper C-band available for 5G wireless commercial use,” CTIA CEO Meredith Attwell Baker said in a statement. However, Carr didn’t specifically say whether that C-band 2.0 auction would be for 5G. “We will vote on a notice of inquiry that asks whether the commission should open up additional portions of the C-band (3.98-4.2 GHz) for more intensive use. We want to hear your views,” Carr wrote.
Elon Musk’s SpaceX and the major U.S. 5G telcos (AT&T, Verizon, T-Mobile) have expressed interest in upper C-band spectrum. SpaceX said in January that the FCC should develop “a modernized sharing framework” for the upper C-band, presumably so that it could be used by both satellite operators (like SpaceX) and terrestrial operators (like AT&T, Verizon and T-Mobile).
“Establishing a modernized sharing framework for the upper C-band that welcomes multiple new entrants is essential to solidify American leadership in 6G, which will interweave terrestrial and satellite networks into a seamless consumer experience,” SpaceX wrote. Politico noted that FCC’s Carr – has been developing ties to Musk.
“While the outcome is far from certain, we give an edge to the wireless interests,” wrote Blair Levin, a policy adviser to New Street Research and a former high-level FCC official, in a recent note to investors. “In this administration it appears that ‘whatever Elon wants, Elon gets.’ So, it is difficult to have conviction on the outcome.” Indeed, there are plenty of ways for the FCC to handle the upper C-band situation. Levin wrote, “There are multiple compromises available, such as allocating some to exclusive and some to satellite sharing or getting back more spectrum from the current users,” he wrote.
Other industry watchers are unsure about SpaceX vs wireless industry C-band spectrum bidding:
- “It’s unclear whether SpaceX could overcome the wireless lobby’s desire for more terrestrial spectrum,” analyst Tim Farrar, with TMF Associates, told Light Reading.
- “The upper C-band is an enormous opportunity to unleash additional spectrum for mobile 5G, for LEO [low-Earth orbit] satellite direct-to-device connectivity, or for a combination of both,” Michael Calabrese told Light Reading. Calabrese is director of the Wireless Future Project, which is part of New America’s Open Technology Institute think tank. Calabrese said that FCC Chairman Brendan Carr “is wise to open a notice of inquiry to explore what form of repurposing or sharing will best promote innovation and the connectivity needs of the future. The one certainty is that the 220 megahertz in C-band that was not repurposed five years ago should be a priority for reallocation to a higher and better use today.”
–>The previous C-band sale may have been the peak of wireless network operator spectrum spending, but we could see the big players pony up a significant amount of cash again in the next year or so at FCC auctions.
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Mr. Carr also talked about an upcoming AWS-3 frequency auction, indicating that it is on track to take place by mid-2026 as required by law. In one of his first official statements as the new chairman of the FCC, Carr said he plans to auction AWS-3 spectrum before the end of next year. He added that the commission would consider holding another auction of C-band spectrum.
“This month, we will vote to kickstart the process for reauctioning a large number of AWS-3 spectrum licenses that have sat in inventory for years. This auction will be a win-win. It brings new spectrum into play for commercial use. And the proceeds from this auction will also cover the costs of the national security initiative known as “rip and replace”—an effort that is removing untrustworthy technology, like Huawei and ZTE gear, from networks. Specifically, our AWS-3 notice of proposed rulemaking will ensure that the Commission is on track to meet its statutory obligation to complete this auction by June 23, 2026.’
Those auctions will help pay for Rip and Replace (mostly Huawei network equipment) from U.S. telco networks. The Rip and Replace program was created in 2020 to remove Chinese components from U.S. wireless communications systems. The Rip and Replace fund needs an additional $3B in order to finish its mission.
AT&T is the most likely to spend big on the AWS-3 spectrum sale, given that it has less mid-band spectrum than its rivals, and CEO John Stankey has already expressed interest in the airwaves.
References:
https://www.telecoms.com/spectrum/new-fcc-chair-looks-to-repeat-c-band-mega-auction
https://broadbandbreakfast.com/fcc-to-vote-on-aws-auction-inquiry-into-upper-c-band-2/
https://www.lightreading.com/5g/could-elon-grab-some-of-5g-s-spectrum-
https://www.lightreading.com/5g/carr-hands-a-spectrum-gift-to-5g-industry
https://www.ctia.org/news/ctia-statement-on-chairman-carrs-announcement-on-upper-c-band
https://www.fcc.gov/February2025
Eric Schmidt: FCC C-Band Auction Dooms U.S. 5G Future
UPDATED: Mid-band Spectrum for 5G: FCC C-Band Auction at $80.9B Shattering Records
FCC Auction 110 for mid-band 5G spectrum gets $21.9B in winning bids
FCC Chairman Pai Reviews 5G FAST plan and importance of the C-Band (3.7 GHz to 4.2 GHz) auction
4 U.S. Mobile Operators offer C-band FCC proposal to address aircraft interference
FCC Auction 108 (2.5 GHz) ends with total proceeds << than expected; T-Mobile expected to be #1 spectrum buyer
FCC launches new 5G mid-band wireless spectrum auction (FCC Auction 108)
Bloomberg: 5G in the U.S. Has Been a $100 Billion Box Office Bomb
Network equipment vendors increase R&D; shift focus as 0% RAN market growth forecast for next 5 years!
In 2024, Ericsson’s R&D spending was SEK53.5 billion ($4.8 billion). “It is our firm commitment to really ensure that we have capacity to do the investments in R&D over time,” said Lars Sandström, Ericsson’s chief financial officer. “I think that has been the guiding star for the company for quite some years and I think, if you go long back into history, we felt that has been hurting our ability to invest when not having the right cash position.” Meanwhile, Nokia’s R&D spending rose 5% on the year, to about €4.5 billion ($4.6 billion).
Combined, that was only one-third of Huawei’s projected 2024 R&D spending of around 197.8 billion yuan or $27.3 billion which was ~20% higher than 2023. Huawei’s R&D spending has increased in recent years, from 102 billion yuan in 2018 to 164.7 billion yuan in 2023. It invests more than 10% of its sales revenue into R&D each year. In addition to telecom and IT equipment/software, Huawei is a leader in China’s efforts to develop advanced chips and technology. The company is involved in a government-funded project to develop memory units for AI chips.
Mobile network market shrinkage has not helped ROI in wireless network R&D projects. Overall RAN sales fell 11% in 2023, to about $40 billion, said researchers at Informa owned Omdia. At the midpoint of its most recently published data, Omdia was anticipating another contraction of 15% in 2024 to ~$35 billion.
Stefan Pongratz of Dell’Oro said that mobile infrastructure investments slowed significantly in 2024. Preliminary findings indicate that the Radio Access Network (RAN) market contracted by 10 to 20% year-over-year (YoY) during the 1Q24 to 3Q24 period (final 4Q24 and full-year data expected around mid-February). Network operators in many countries paused spending after their initial 5G rollouts did not lead to meaningful improvements in sales or profitability.
Following the intense 5G acceleration phase from 2017 to 2022, RAN investments declined sharply in 2023 and 2024, with the exception of India where RAN market growth is now tapering off.
While data for 2024 is unavailable, the top five vendors – Huawei, Ericsson, Nokia, ZTE and Samsung – served ~95.1% of the global RAN market in 2023, according to Omdia. That doesn’t leave much room for start-up or other RAN equipment makers (like Fujitsu, NEC, Datang Mobile, Mavenir, CICT Mobile, Comba, and other small players).
“The underlying message we have communicated for some time has not changed,” said Stefan Pongratz, Vice President for RAN market research at Dell’Oro Group. “Regional imbalances will impact the market dynamics over the short term while the long-term trajectory remains flat. This is predicated on the assumption that new RAN revenue streams from private wireless and FWA, taken together with MBB-based capacity growth, are not enough to offset slower MBB coverage-based capex,” continued Pongratz.
Additional highlights from Del’Oro’s Mobile RAN 5-Year January 2025 Forecast Report:
- Worldwide RAN revenues are projected to grow at a 0% CAGR over the next five years, as rapidly declining LTE revenues will offset continued 5G investments.
- Medium-term risks to the baseline are balanced, while the long-term risks are tilted to the downside and characterized by the data growth uncertainty with the existing MBB use case. As the investment focus gradually shifts from coverage to capacity, one of the most significant forecast risks is slowing mobile data traffic growth. Given current network utilization levels and data traffic trends in more advanced markets, there are serious concerns about the timing of capacity upgrades.
- The mix between existing and new use cases has not changed. Private/enterprise RAN is expected to grow at a 20 percent plus CAGR while public RAN investments decline. At the same time, because of the lower starting point, it will take some time for private RAN to move the broader RAN needle.
- 5G-Advanced positions remain unchanged. The technology will play an essential role in the broader 5G journey. However, 5G-Advanced is not expected to fuel another major capex cycle. Instead, operators will gradually transition their spending from 5G towards 5G-Advanced within their confined capex budgets.
- RAN segments that are expected to grow over the next five years include 5G NR, FWA, mmWave, Open RAN, vRAN, private wireless, and small cells.
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So how do incumbent RAN vendors cope? Ericsson is becoming more heavily reliant on software sales. CEO Börje Ekholm told analysts on the company’s last earnings call: “It is going to take some time for customers to realize we are increasingly becoming a software business. If you go back 15 years, we were much more hardware-centric, and then it was a bigger question for customers. As you move into becoming a software vendor, the working capital becomes less and less and less.”
Nokia is turning to data center connectivity for growth. CEO Pekka Lundmark declared that data centers are now the company’s top growth target, shifting away from its traditional focus on telecommunications networks and services. Nokia is developing and promoting data center switching platforms, IP networking solutions, and automation technologies to cater to the needs of hyperscalers and enterprise customers. The company has secured notable contracts with companies like CoreWeave, a leading AI hyperscaler, which demonstrates their growing presence in the data center space. It’s also in the process of acquiring fiber optic equipment company Infinera which will enhance both inter and intra- data center connect capabilities. Nokia is emphasizing open-source software like SONiC alongside its own SR Linux operating system to provide flexibility and cater to diverse customer requirements.
References:
https://www.lightreading.com/5g/ericsson-and-nokia-flaunt-cash-as-open-ran-pack-struggles
RAN Equipment Market to Remain Uninspiring, According to Dell’Oro Group
Dell’Oro: Global RAN Market to Drop 21% between 2021 and 2029
Highlights of Dell’Oro’s 5-year RAN forecast
Mobile Experts: Open RAN market drops 83% in 2024 as legacy carriers prefer single vendor solutions
Dell’Oro: OpenRAN revenue forecast revised down through 2027
Dell’Oro: RAN market still declining with Huawei, Ericsson, Nokia, ZTE and Samsung top vendors
Dell’Oro & Omdia: Global RAN market declined in 2023 and again in 2024
Dell’Oro: RAN market declines at very fast pace while Mobile Core Network returns to growth in Q2-2023
Dell’Oro: RAN Market to Decline 1% CAGR; Mobile Core Network growth reduced to 1% CAGR
Empresa de Telecomunicaciones de Cuba in its worst ever state; saddled with worthless Cuban pesos
Cuba’s national monopoly telco, Etecsa (Empresa de Telecomunicaciones de Cuba) is chronically starved of the foreign currency which it needs to buy telecom infrastructure equipment, such as cables and network hardware. Etecsa only has Cuban pesos, which are completely worthless outside its borders. No company in any other country will accept pesos in payment for anything.
Translating Cuba, which has translated and published a 14ymedio article in English, we have learned that the state-owned telco has been fined by the government for failing to spend its entire 2024 peso budget, even though it tried to do so. The island’s network operator had already told the authorities that it had underspent by many millions of pesos because no foreign company will accept them in payment either for goods or services.
The proposed solution was to designate the underspent cash as profit and then divide it up between Etecsa employees, but the Cuban government objected, fined the telco, and sequestered the cash.
To prevent the scenario from being repeated this year, Etecsa is preparing new payment methods for its services to collect as much hard currency as it can.
“Several scenarios have been evaluated, and so far the one that seems the best is to limit the number of recharges in national currency for the same customer. When he gets down to a certain monthly amount, he will have to recharge in dollars,” clarifies the administrator. “Together with the recharges from abroad, the purchase in Cuba will be enabled, directly in dollars or with a Classic card.”
“What happens now is that mobile phone customers sometimes have thousands of pesos left and can buy as many navigation packages as they want. They can even make transfers of that money so that others can buy a connection package. It will remain limited, because there’s not much Etecsa can do with that Cuban money. It’s worthless for investments and purchasing infrastructure.”
“We are just now restructuring everything, and that is one of the reasons why we are removing some monthly offers of recharges with a bonus, because there are many customers whose relatives abroad buy the recharge for them, which includes a balance and a recharge package, but then they resell it to others who pay them in Cuban pesos, and these in turn buy new navigation packages. We even know that many relatives send them dollars, and they change them on the black market and buy the packages in national currency. So Etecsa doesn’t earn foreign exchange and can’t go on like this because this is a telecommunications company and has to earn a lot of money.”
“We are tying pieces of cables together to repair the breaks,” one Etecsa employee told 14ymedio, adding that the company is going through “the worst crisis since its creation.” As a result of the foreign currency crisis, in 2022 the telco was unable to “fulfill its financial commitment to Nokia,” the island’s mobile data infrastructure supplier.
For the 2025 budget, the Minister of Finance and Prices, Vladimir Regueiro Ale, has warned that a “special tax on telecommunications services” will be implemented. According to the owner, “this will generate a tax in addition to the invoices from the Cuban Telecommunications Company of more than 13 billion pesos,” a sea of national currency for some dollar-thirsty coffers. That sounds like a lot, but it’s currently the equivalent of $542m and it’s useless Cuban pesos…That won’t help Etecsa which is in its worst ever state, unable to make basic repairs or replace the batteries that power mobile network sites.
“There are no land lines to replace, we lack the boxes for home installation, and there are also many problems with supplying cables.”
The lack of liquidity has been taking its toll on Etecsa for years, especially with its foreign investors. In 2022, for the first time in 15 years, the company could not fulfill its financial commitment to Nokia, the Finnish company that has worked on the Island implementing the data service for mobile telephony.
References:
Etecsa Will Start Charging for Some Services in Dollars Inside Cuba
Telecom data traffic in Cuba grows 10% due to COVID-19; Free access to EnZona e-commerce platform
What’s the real status of Internet access in Cuba?
Cuba-Google agreement to speed up Internet access on the island
AT&T and Verizon cut jobs another 6% last year; AI investments continue to increase
In 2018, after AT&T acquired Time Warner, the enlarged AT&T had approximately 230,000 employees and annual revenues of about $172 billion. Both figures have declined subsequently, but headcount has been reduced at a much sharper rate. Data published this week, after AT&T reported full-year sales of $122.3 billion, shows another 9,500 jobs were cut in 2024, decreasing the total to 141,000 workers. Back in 2017, counting the Time Warner business it was then trying to buy, AT&T had as many as 280,000 employees. Is AI being used to replace jettisoned employees at AT&T?
During Monday’s earnings call, AT&T’s CEO John Stankey said AI is already powering a variety of functions at the telco. “What we’ve been able to do in our call centers and how we operate within our customer base, a lot of that has been driven by AI tool applications. And it’s not that we’re necessarily exclusively replacing individuals with the technology, but we’re making them a lot more effective and efficient,” Stankey said, adding that AT&T is also using AI to develop its computer code. “We’re spending less right now to develop new code internally … and it’s through the application of AI and technology.”
Stankey added that AT&T plans to invest more heavily in AI this year, including by using its customer data to more effectively target customers with promotions and other offerings. “If I were to say I had a goal for 2025, I would like to … be talking about good momentum we’ve received in business as a result of executing on some of those things moving forward.”
AI was also highlighted during recent calls about financial results as something that would help to sharpen the axe. Those updates came after AT&T said in December 2024 that its latest aim was to slash another $3 billion in annual costs by the end of 2027. “In 2025, we will make progress on this goal by further integrating AI throughout our operations,” said Stankey this week. AT&T has also put AI to use on writing code and adapting the capabilities of the mobile network based on analysis of traffic patterns.
AT&T officials have previously discussed the possibility that AT&T central offices could host AI capabilities. During a recent analyst event, AT&T CTO Jeremy Legg said that some of the company’s central offices could be used for AI, but that the company would have to address the power requirements for those AI computing functions.
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Job cuts at Verizon have also been dramatic. Under CEO Hans Vestberg, it has managed to grow sales while axing jobs. Annual revenues at the company rose by $6.5 billion between 2020 and 2024, to about $134.8 billion, just as 32,600 jobs were slashed over this period. Workforce shrinkage left Verizon with fewer than 100,000 employees at the end of 2024. The rate of Verizon job cuts was relatively low in 2024, when fewer than 6,000 positions were eliminated, down from the nearly 12,000 that were scrapped in 2023. Yet Verizon employs about 78,000 fewer people today than it did ten years ago, and there has been no sign the trend might go into reverse.
At Verizon, “driving down costs in our operations” is part of a “three-pronged strategy for AI,” Vestberg told analysts. AI Connect, which should be the most exciting prong, positions AI in the same way edge computing was positioned years ago. The idea is to host the resources needed for AI applications in the network facilities that dot the US – some 16,000 “near net” enterprise locations, according to Verizon, along with between 100 and 200 acres of land partially “zoned” for data center build – and then charge for the privilege.
“If you think about where we are on generative AI today, it’s where large language modules are trained at large data centers and that require enormous capacities. Over time, that will, of course, come much closer to the edge of the network,” Verizon CEO Hans Vestberg explained on the operator’s quarterly conference call.
Kyle Malady, head of Verizon Business and the executive leading the operator’s AI efforts, offered more details: “Power, space and cooling are the currencies that are in demand right now, and we have all three,” he said in discussing the AI sector. “As we look across our assets, take inventory and compare against other players in the market, we believe that we are in a leadership position when it comes to usable power and space. We have facilities across the United States that either have spare power, space and cooling, or can be retrofitted. As we sit here today, we have 2-10+ megawatts of usable power across many of our sites. … In addition, we have between 100 and 200 acres of undeveloped land, some currently zoned for data center builds, and much of it in prime, data center-friendly areas.” Malady added that Verizon would deploy Vultr’s GPU-as-a-Service (GPUaaS) in its data centers in order to support the AI computing applications that require those kinds of high-performance graphical processing units (GPUs).
Malady added that Verizon sees a total addressable market (TAM) of $40 billion or more in this new area.
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CEO’s Stankey and Vestberg have made cost cutting a priority, but most of the attendant layoffs so far are not due to the impact of AI. Stankey said, “It’s not that we’re necessarily exclusively replacing individuals with the technology, but we’re making them a lot more effective and efficient in how they handle customer needs and then complementing that with customer-supported AI.”
If AI does create new types of job, as many AI cheerleaders say, they have clearly not increased the headcount at AT&T or Verizon. A key take-away is that over the last few years, telcos were able to operate a business of roughly the same size with just a fraction of the workforce they previously employed. Average revenues per employee rose 6% at Verizon last year, to about $1.35 million, and have soared from less than $717,000 a decade ago. At AT&T, they grew 7% in 2024, to nearly $868,000, and are up from less than $544,000 in 2014.
References:
https://www.lightreading.com/ai-machine-learning/at-t-and-verizon-cut-another-15-3k-jobs-in-2024-as-ai-advanced
Verizon and AT&T cut 5,100 more jobs with a combined 214,350 fewer employees than 2015
https://www.verizon.com/about/news/verizon-unveils-ai-strategy-power-next-gen-ai-demands
https://www.lightreading.com/the-edge-network/at-t-and-verizon-are-pivoting-into-the-landlord-biz-for-ai
AT&T to deploy Fujitsu and Mavenir radio’s in crowded urban areas
AT&T’s leads the pack of U.S. fiber optic network service providers
AT&T’s fiber business grows along with FWA “Internet Air” in Q4-2023
U.S. Cellular to Sell Spectrum Licenses to Verizon in $1 Billion Deal
Verizon to buy Frontier Communications
Verizon Business sees escalating risks in mobile and IoT security
Ericsson’s sales rose for the first time in 8 quarters; mobile networks need an AI boost
Ericsson today said sales in its key networks unit grew 4% in the 4th quarter as contract wins and network investments by some large customers contributed to a 70% jump in North America (NA) sales, but its cloud software and enterprise units both saw sales and earnings decline. Revenue in the NA region rebounded sharply in the third quarter and continued to do so in the fourth quarter, helped by deliveries under a major AT&T “Open RAN” contract that began last year and will continue into 2025. AT&T’s Open RAN plan is for 70% of its wireless network traffic to flow across open-capable platforms by late 2026.
India has largely completed a rapid phase of network upgrades that saw deployments peak in 2023, and operator investments in the country have now normalized, Ericsson said. Total sales rose 1.4% to 72.91 billion kronor, after declining at double-digit rates in both 2023 and 2024.
“The near-term market recovery is in the hands of our customers, but our confidence in the stabilizing market is growing,” Chief Executive Borje Ekholm said on an analyst call Friday. “We are starting to see a change in sentiment.” He later said, “5G has not been built out. If you take the North American market, 5G standalone is not rolled out [1.]. London in Europe has very limited buildout. Most of the time when you get the 5G icon on your phone, you are basically on dynamic spectrum sharing using 4G spectrum.”
Note 1. Not true. Both T-Mobile and Dish Network have deployed 5G SA networks.
“I think the whole world is moving from a cost-optimized supply chain to resilience. You need to factor in resilience in the supply chain and that is why we built a US factory, and we are investing to increase capacity in the U.S. as well,” said Ekholm.
On that analysts call, Chief Financial Officer Lars Sandstrom said the company has production in North America, Latin America, Europe, Asia and India, so it has the opportunity to move production between different sites depending on President Trump’s plans. “Of course tariffs could have an impact going into 2025, but I think we’re all waiting a little bit to what is going to happen there,” he said, adding that there might also be tariff exemptions for critical products.
Ericsson said restructuring charges rose to 1.6 billion kronor in the quarter, mainly related to redundancies, efficiency measures and right-sizing operations to align with lower demand in some markets. The company said that restructuring charges for 2025 are expected to remain at elevated levels. Indeed, Ericsson has heavily cut costs, eliminating 9,400 “internal and external” jobs in 2024. The net reduction leaves the company with 94,236 employees, down from 99,952 a year earlier and more than 111,000 back in 2017, when Ekholm first took charge. Over this period, it has retreated from various activities in TV and cloud hardware to concentrate on 5G, although its $6.2 billion takeover of Vonage in 2022 brought additional staff into the business.
Ekholm acknowledged what IEEE Techblog readers already know – that mobile network data traffic growth has slowed down, which reduces demand for Ericsson’s products. Ericsson’s response has included putting heavy emphasis on the concept of programmability, whereby 5G networks could be dynamically adapted to support different services and scenarios, including artificial intelligence (AI) applications.
“The network needs to be prepared for the AI traffic,” said Ekholm. “It’s going to require more uplink. It’s going to require a different performance of the network. That, I think, may be more important in the next few years as a traffic definition. So yes, overall traffic is probably going to continue to taper down. But I think the demand coming from the new applications on top will materially impact the way you need to invest in the network.” However, that AI RAN initiative is in its infancy and yet to be commercially deployed.
References:
https://www.lightreading.com/5g/ericsson-boosted-by-us-but-axed-9-400-jobs-last-year
https://about.att.com/story/2023/commercial-scale-open-radio-access-network.html
vRAN market disappoints – just like OpenRAN and mobile 5G
The case for and against AI-RAN technology using Nvidia or AMD GPUs
Dell’Oro & Omdia: Global RAN market declined in 2023 and again in 2024
Latest Ericsson Mobility Report talks up 5G SA networks (?) and FWA (!)
Beyon partners with Ericsson to build energy-efficient wireless networks in Bahrain
Ericsson and e& (UAE) sign MoU for 6G collaboration vs ITU-R IMT-2030 framework
Dell’Oro: RAN market still declining with Huawei, Ericsson, Nokia, ZTE and Samsung top vendors
Ericsson on 5G use cases: remote surgery, augmented and virtual reality with AI agent all depend on 3GPP URLLC specs
Nokia (like Ericsson) announces fresh wave of job cuts; Ericsson lays off 240 more in China
Swisscom (with Ericsson) to offer the world’s best and most sustainable mobile network
Gartner: Gen AI nearing trough of disillusionment; GSMA survey of network operator use of AI
Global IT spending is expected to total $5.61 trillion in 2025, an increase of 9.8% from 2024, according to the latest forecast by Gartner, Inc.
“While budgets for CIOs are increasing, a significant portion will merely offset price increases within their recurrent spending,” said John-David Lovelock, Distinguished VP Analyst at Gartner. “This means that, in 2025, nominal spending versus real IT spending will be skewed, with price hikes absorbing some or all of budget growth. All major categories are reflecting higher-than-expected prices, prompting CIOs to defer and scale back their true budget expectations.”
GenAI will Influence IT Spending, but IT Spending Won’t Be on GenAI Itself:
Segments including data center systems, devices and software will see double-digit growth in 2025, largely due to generative AI (GenAI) hardware upgrades (see Table 1). However, these upgraded segments will not differentiate themselves in terms of functionality yet, even with new hardware.
Table 1. Worldwide IT Spending Forecast (Millions of U.S. Dollars)
2024 Spending |
2024 Growth (%) |
2025 Spending |
2025 Growth (%) |
|
| Data Center Systems | 329,132 | 39.4 | 405,505 | 23.2 |
| Devices | 734,162 | 6.0 | 810,234 | 10.4 |
| Software | 1,091,569 | 12.0 | 1,246,842 | 14.2 |
| IT Services | 1,588,121 | 5.6 | 1,731,467 | 9.0 |
| Communications Services |
1,371,787 |
2.3 | 1,423,746 | 3.8 |
| Overall IT | 5,114,771 | 7.7 | 5,617,795 | 9.8 |
Source: Gartner (January 2025)
“GenAI is sliding toward the trough of disillusionment which reflects CIOs declining expectations for GenAI, but not their spending on this technology,” said Lovelock. “For instance, the new AI ready PCs do not yet have ‘must have’ applications that utilize the hardware. While both consumers and enterprises will purchase AI-enabled PC, tablets and mobile phones, those purchases will not be overly influenced by the GenAI functionality.”
Spending on AI-optimized servers easily doubles spending on traditional servers in 2025, reaching $202 billion dollars.
“IT services companies and hyperscalers account for over 70% of spending in 2025,” said Lovelock. “By 2028, hyperscalers will operate $1 trillion dollars’ worth of AI optimized servers, but not within their traditional business model or IaaS Market. Hyperscalers are pivoting to be part of the oligopoly AI model market.”
Gartner’s IT spending forecast methodology relies heavily on rigorous analysis of the sales by over a thousand vendors across the entire range of IT products and services. Gartner uses primary research techniques, complemented by secondary research sources, to build a comprehensive database of market size data on which to base its forecast.
More information on the forecast can be found in the complimentary Gartner webinar “IT Spending Forecast, 4Q24 Update: GenAI’s Impact on a $7 Trillion IT Market.”
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Gartner’s 2025 forecast for IT spending is consistent with the market research firm’s predictions from late last year that the move to AI is driving a surge in spending on data center infrastructure and IT services in Europe. IT spending across the continent will come in at US$1.28 trillion in 2025 they said. Presumably it takes a little longer to gather up the data necessary for predictions across the whole world.
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Separately, Citi analysts expect 2025 growth to be largely driven by continued AI spending as data center capital expenditure for the biggest cloud service providers is forecasted to increase by 40% this year.
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In a recent survey of network operators, GSMA found that telcos are allocating more resources to in-house and out-of-house AIs capabilities and projects, but only a subset are spending more than 15% of their digital budgets on AI. Nearly half of operators are dedicating 5% to 15% of their digital budgets towards AI, covering a range of categories, including data systems, large language models and infrastructure upgrades, the GSMA survey found. That AI money is also being allocated toward AI teams, tools and partnerships, said GSMA. The association, which primarily represents mobile operators, has been asked for more details about the size, scope and methodology of its latest study.
AI Status at Network Operators:
References: