EET Asia (2020-04-21)
According to a research note from ABI Research focusing on telco cloud revenues from 5G core deployments, this could fall between 20% to 30% short of previous forecasts of $9 billion this year. ABI fears the investment shortfall in updating networks could be between $2 billion to $3 billion ‘in the short term’.
“The 5G market was growing faster than anticipated, with 2020 expected to be the starting point for 5G Standalone (SA) core commercial deployments in CSPs’ networks. But that expectation may take a little longer to materialize.
“That is due, in part, to the fact that Covid-19 will almost certainly derail further trials and testing to verify the processing performance and stability of 5G Stand Alone networks. In the short term the industry may have no choice but to protect existing consumer revenue,” suggests Don Alusha, senior analyst at ABI.
Meanwhile, Dimitri Mavrakis, Research Director for 5G at ABI, told EE Time,s“there are relatively few challenges as regards the supply chain, which remains relatively robust. The biggest problem we see impacting deployments is that relating to site engineers and technicians, who clearly need to follow strict guidelines when working in close proximity with others, as well as access issues to some key sites.”
Again, these sentiments echo the projections at Gartner. Porowski told EE Times, “infrastructure supply chains have been slowed but not broken. CSP inventories have thinned, but at the moment there are no major concerns about the non-availability of critical infrastructure.”
Mavrakis suggests this could add at least 3 months of delays to the process. The bigger problem, he argues, is consumer confidence and the availability of 5G enabled devices.
The lockdown has also, counter intuitively, focused some to question the need for 5G. “We are hearing from clients, and experiencing, that existing networks are coping relatively well at most operators. But this really misses the point that 5G is targeting the macrocell domain, and thus outdoors coverage. Of course, most of us now are indoors. That clearly will change and we will see that 5G is very much a much needed, cutting edge technology for the medium and long term.”
ABI Research said due to disruptions in the supply chain, caused primarily by a shortage of certain components and integration engineers, it is now forecasting a 10% fall in 5G infrastructure revenues from the forecasted $2.1 billion.
As for 5G enabled smartphones, “we are looking at a 30% shortfall in shipments for now, but this, also, will be reined back once business is back to normal,” said Mavrakis. The big surge is expected to come once the mobile network operators have opened their retail outlets, where the majority of upgrades and new subscriptions are sealed.
According to senior analyst at ABI research Jiancao Hou, the spread of Covid-19 globally is likely to delay deployment of advanced 5G NR systems, including MIMO and active antennas that many operators have started deploying. “This may mean that operators that have already deployed a significant number of base stations will be in a better position to become early adopters and benefit from an earlier transition from previous generations to 5G, but this will rely on the availability of relevant handsets.”
Referencing the on-going discussions on OpenRAN and open networks, Hou suggests “it is important for mobile operators to broaden their supply chain and avoid a single-vendor infrastructure market.”