Telecom Equipment Market Size & Industry Share - Growth Trends & Forecasts (2023 - 2030)

Based on the Component :

The component segment is bifurcated into hardware and software. Hardware accounted for the largest market share in 2022 and includes hardware network, IP intercom hardware, servers, and storage hardware, among others. Hardware network holds the maximum share as the hardware components form the backbone of the networks, facilitating the transmission of voice-over-data and multimedia communications. Additionally, hardware networks are designed to provide high performance and are optimized for handling large volumes of data, ensuring low latency, and delivering consistent connectivity. For instance, in June 2023, ventureLAB launched Hardware Angel Network, an advanced telecom equipment for delivering high-quality data connectivity to users. The advanced equipment is designed to provide low latency to users, improving the telecom infrastructure, hence contributing remarkably in accelerating the growth of the hardware segment.

Software is projected to witness the fastest CAGR in the telecom equipment market during the forecast period. The growth is attributed to the shift from traditional hardware-based solutions to software-based virtualized networks. In addition, the software-defined network allows for centralized network control and management through software, providing flexibility, scalability, and cost-efficiency. Moreover, the emergence of network function virtualization decouples network functions from dedicated hardware appliances and virtualizes in software, allowing telecom operators to deploy network functions on standard servers and infrastructure, reducing costs and increasing agility. Consequently, the aforementioned factors are collectively responsible in accelerating the growth of the software segment in the upcoming years.

Based on the Type :

The type segment is divided into mobile communication system, network communication equipment, and optical communication equipment. Network communication equipment accounted for the largest market share of 41.4% in 2022 as network communication equipment forms the fundamental infrastructure of telecom networks. Network communication equipment includes switches, routers, gateways, access points, and other devices that enable the routing, switching, and transmission of data within and between networks. The components are essential for establishing and managing communication pathways, ensuring connectivity, and enabling data transfer across various network nodes. In addition, network communication equipment supports voice communication, data transmission, video streaming, internet access, and cloud services, among others, further driving the adoption of communication equipment.

Mobile communication system is anticipated to witness the fastest CAGR during the forecast period. The growth of the market is endorsed by the rising number of mobile subscribers worldwide, along with the expanding mobile networks, and rising internet penetration. In addition, the exponential growth of mobile data traffic, fueled by video streaming, social media usage, app downloads, and other data-intensive activities, is also contributing to the growth of the mobile communication system segment. Moreover, the increasing adoption of mobile communication systems in various sectors including railway, retail, and healthcare is further promoting market growth. For instance, in September 2022, Huawei introduced Future Railway Mobile Communication System (FRMCS) for the development of a secure, efficient, and smarter railway communications network. The system is launched to reshape the digital platform of the railway and improve the digital infrastructure, thus contributing significantly in boosting the market growth.

Based on the Infrastructure :

The infrastructure segment is bifurcated into wired and wireless. Wireless infrastructure accounted for the largest market share in 2022 and is also projected to witness the fastest CAGR in the upcoming years. Wireless infrastructure enables ubiquitous connectivity, allowing users to access communication services without the need for physical cables. In addition, wireless networks provide coverage over large areas, including urban, suburban, and rural regions, ensuring widespread connectivity and accessibility. Moreover, wireless infrastructure allows users to move freely while staying connected and is increasingly adopted in various industries and applications, including transportation, logistics, healthcare, and smart cities. Furthermore, wireless technologies enable the deployment of mobile communication solutions, namely cellular networks, Wi-Fi hotspots, and wireless sensor networks, facilitating seamless connectivity. Consequently, the aforementioned factors are collectively responsible in driving the growth of wireless infrastructure during the forecast period.

Based on the Technology :

The technology segment is classified into 2G, 3G, 4G, and 5G. 4G accounted for the largest market share in 2022 as 4G technology is based on globally recognized standards including Long-Term Evolution (LTE) and Worldwide Interoperability for Microwave Access (WiMAX). The standardization ensures compatibility and interoperability between different network equipment manufacturers and network operators and also simplifies the deployment process and reduces costs. In addition, 4G networks provide significantly faster data speeds compared to previous generations. The increased speed enables a wide range of bandwidth-intensive applications, including video streaming, online gaming, and cloud-based services. Moreover, 4G technology offers improved network capacity, allowing more simultaneous connections and better handling of high data traffic, thus contributing significantly in driving the growth of the 4G segment.

5G segment is anticipated to witness the fastest CAGR in the telecom equipment market during the forecast period. The growth of the market is attributed to the ability of 5G networks to offer significantly higher network capacity compared to previous generations. Additionally, 5G networks utilize advanced techniques namely massive MIMO (Multiple-Input Multiple-Output) and beamforming to support a larger number of devices simultaneously. Moreover, 5G promises substantially faster data speeds and delivers peak download speeds of up to 10 gigabits per second. The high speed enables users to download and stream high-definition content, participate in real-time applications, and experience seamless virtual reality and augmented reality experiences. Furthermore, the increasing investments by the government to initiate 5G services to enhance the digital infrastructure are also contributing remarkably in bolstering the market growth. For instance, in April 2023, the United Kingdom government invested approximately USD 44.02 million to boost the 5G infrastructure. The investment is made with the aim to enhance the digital infrastructure by 2030, hence contributing notably in promoting market growth.

Based on the Industry Vertical :

The industry vertical segment is categorized into IT and telecom, retail, BFSI, healthcare, media and entertainment, military and defense, consumer electronics, and others. Consumer electronics accounted for the largest market share in 2022 as telecom equipment forms the backbone of mobile communication infrastructure, enabling voice calls, text messaging, and internet connectivity on smartphones and other mobile devices. Additionally, telecom equipment includes components namely cellular base stations, antennas, signal amplifiers, and network switches that facilitate wireless communication between devices and cellular networks. Consequently, the expanding consumer electronics industry is driving the growth of the telecom equipment market to enable seamless communication. For instance, in November 2022, according to India Brand Equity Foundation (IBEF), the consumer electronics industry accounted to USD 9.84 billion in 2021 and is expected to reach USD 21.18 billion in 2025. The growth in the consumer electronics industry thus contributes remarkably in bolstering the market growth.

IT and telecom sector is predicted to witness the fastest CAGR during the forecast period in the telecom equipment market. Telecom equipment forms the backbone of telecommunication networks, including landline, mobile, and Internet Service Provider (ISP) networks. The equipment enables voice and data communication, connectivity, and the transmission of information across different communication channels. In addition, telecom equipment is essential for establishing and maintaining network infrastructure including routers, switches, network cables, wireless access points, and network management systems. The components enable the creation, management, and maintenance of local area networks (LANs), wide area networks (WANs), and other network architectures necessary for IT and telecommunication operations, hence contributing significantly in propelling the market growth.

Based on the Region :

The regional segment includes North America, Europe, Asia Pacific, Middle East and Africa, and Latin America.

North America accounted for the largest market share of 186.92 million in 2022 and is expected to reach 320.81 million in 2030 as the region invests heavily in developing robust network infrastructure, including both wired and wireless networks. In addition, in the region, the U.S. accounted for the maximum revenue share of 55.45% in the year 2022. Additionally, the region's advanced telecommunications infrastructure, including high-speed broadband networks, extensive fiber-optic connectivity, and 5G cellular networks, provides a solid foundation for the deployment and adoption of telecom equipment. Moreover, North America boasts robust research and development capabilities in the telecom sector along with the presence of top-tier universities, research institutions, and technology hubs encourages innovation and collaboration among academia, industry, and government organizations. Furthermore, the increasing investments by the government to develop advanced communication technologies are also contributing in driving the market growth. For instance, in April 2021, the Department of Defense in partnership with The National Science Foundation invested USD 40 million for the expansion of cellular, Wi-Fi, and satellite networks to connect billions of Americans across the United States.

Asia Pacific is expected to register the fastest CAGR of 7.5% during the forecast period in the telecom equipment market. Asia Pacific is at the forefront of mobile connectivity, with high smartphone penetration and data usage. The region has also been actively rolling out 5G networks, with countries including China, South Korea, and Japan leading the way. In addition, the deployment of 5G technology requires significant investments in telecom equipment, contributing to the growth of the market in the region. Moreover, the growth of e-commerce and digital services in the Asia Pacific is driving the need for robust telecom infrastructure and equipment. The popularity of online shopping, digital payments, and on-demand services is increasing the demand for high-speed connectivity, data centers, and cloud infrastructure, further driving the adoption of telecom equipment. Consequently, the expanding digital infrastructure and rising e-commerce sector are the key factors responsible for accelerating market growth.