Dell’Oro: MEC Investments to grow at 140% CAGR from 2020 to 2025

Dell’Oro Group has published an update to its Multi-Access Edge Computer (MEC) 5-year forecast report. According to Dave Bolan, Research Director, Dell’Oro has lowered their expectations from the previous forecast, because of the slower start than anticipated for 5G SA buildouts, especially for federated MEC capability.

MEC investments are expected to increase at a 140% compounded annual growth rate (CAGR) in Servers and Packet Core User Plane Functions over the next five years. However, MEC specifications need to evolve for federated MEC networking to address broader requirements in the market.
“The cumulative five-year investment in MEC is expected to be $11B.  Approximately 60% of the revenues will come in 2025. Though it looks lopsided in terms of 2025 revenues, when you look at units, the MEC servers are split almost 50/50 between Public MEC and Private MEC (on-premises), wrote David Bolan, Research Director at Dell’Oro Group.
“Though the CAGR is the same as our previous forecast, the cumulative forecast has decreased due to a slower than anticipated wide-scale launches of 5G Standalone (5G SA) networks. This may be due to 5G service providers (SPs) investigating the role that Public Cloud SPs could play in their networks.”
Image Credit:  Dell’Oro Group (Dave Bolan)
“Another factor may be the need for specifications for federated MEC networking,” commented Bolan. “European Telecommunications Standards Institute (ETSI) MEC committee and GSM Association (GSMA) Operator Platform Group just released their requirements for federated MEC networking, identifying seven uses cases that the SP community needs,” added Bolan.
ETSI Model of MEC:
“While MEC can be done for both 4G and 5G, 4G networks need to be upgraded with control and user plane separation. That separation is inherent in 5G.  Another inherent characteristic of 5G is lower latency than 4G LTE. While the forecast has some 4G MEC, the vast majority is based on 5G standalone for MEC to reach its full potential.”
Dell’Oro Group’s Multi-Access Edge Computing Advanced Research Report offers a complete overview of the market opportunity for the Infrastructure Edge to reduce latency. MEC is a new networking technology designed to capitalize on the opportunity. The market is segmented by Public MEC and Private MEC, and offers a worldwide view of the total available market in revenue and units. The MEC Report includes Definition and Scope, Market Drivers, Use Cases, System Architecture, Vendor Ecosystem, US MEC System Deployment Model, and a 5-year MEC Revenues and Shipments Forecast for Servers and the packet core User Plane Functions.
To purchase the report, please email [email protected].

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