RAN market decline to continue until 6G, says Dell’Oro

Dell’Oro pointed to ‘increased skepticism’ around the need for ‘substantial investments in new technology’ as one reason behind the decline

In a new 6G report, the Dell’Oro Group predicted that Radio Access Network (RAN) revenue will decline until 2029, and that this “downward pressure” will likely continue until the launch of 6G. The firm noted that this period of decline follows a 40 to 50% revenue growth between 2017 and 2021.

Dell’Oro said “typical market fluctuations” are behind the decline, but also commented on “increased skepticism” around the need for “substantial investments in new technology” from telcos. “Some skepticism is warranted,” said Stefan Pongratz, Vice President of RAN and Telecom Capex research at Dell’Oro Group. “After all, operators invested over $2 trillion in wireless capex between 2010 and 2023 to build out 4G and 5G, yet revenues remain flat.”

The market outlook for Open RAN, however, remains “favorable and mostly unchanged,” according to an August Dell’Oro report. Despite ongoing challenges, most operators will gradually incorporate more openness, virtualization, intelligence and automation into their RAN roadmaps, the firm said, adding that the pace will differ slightly between the radios and the baseband. The research firm also noted that the multi-vendor RAN business case is “less compelling.”

Of the RAN market more broadly, Pongratz said this week: “Looking ahead, operators will need to optimize their spectrum roadmaps to address various data traffic scenarios. Our base case assumes that mobile data traffic growth will continue to slow, enabling operators to improve their capital intensity ratios, which will in turn put further downward pressure on the RAN market. However, additional capacity will eventually be required, and at that point, leveraging larger spectrum bands and the existing macro grid will likely offer the most cost-effective solution.”