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The network slicing market is estimated to grow at a CAGR of 28.28% between 2022 and 2027. The size of the market is forecast to increase by USD 821.83 million. The growth of the market depends on several factors, including the development of smart infrastructures, the proliferation of network function virtualization and software-defined networking, and the significant growth in mobile data-traffic volumes.
This report extensively covers market segmentation by component (solution and services), end-user (communication service providers and enterprises), and geography (North America, Europe, APAC, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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Technavio categorizes the global network slicing market as a part of the global communications equipment market within the overall global information technology sector. The parent global communications equipment market covers manufacturers of enterprise networking products, including LANs, WANs, routers, telephones, switchboards, and exchanges. Technavio also includes communications infrastructure or telecom equipment market within the scope of the communications equipment market. Our research report has extensively covered external factors influencing the parent market growth during the forecast period.
The development of smart infrastructures are notably driving the market growth, although factors such as threat of cybersecurity breach may impede the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Key Network Slicing Market Driver
The development of smart infrastructures is the key factor driving the growth of the global network slicing market. Smart cities have become more popular in recent years, perhaps more so than ever before. With the development of a slew of next-generation wireless technologies, such as Li-Fi, 5G, LoRa, and network slicing, as well as the emergence of the Internet of Things (IoT), the experience of large towns and cities is set to improve significantly. Moreover, 3G and 4G were introduced before the true emergence of IoT and smart devices, they lag significantly behind in terms of the technologies required to support such a complex network. Network operators will need to upgrade their infrastructure to accommodate the devices that will account for the $1.7 trillion in consumer spending by 2020.
Network slicing is the process by which network operators can divide or slice their networks based on the needs of their users. Smart services will rely on low latency to provide essential real-time and ultra-reliable connectivity and interactivity to meet the needs of smart cities. Autonomous drones, for example, will require extremely fast response times but not necessarily fast data rates. Cloud-based services, on the other hand, will require fast data rates but not necessarily low latency. This is where network slicing enters the picture. It will enable providers to slice up their 5G networks to meet the various requirements of different services, driving the market demand during the forecast period.
Significant Network Slicing Market Trend
The strategic collaboration among market participants is the primary trend in the global network slicing market. Market participants from different industries, such as information technology solutions, telecommunication network infrastructure, utilities, and semiconductor integrated circuits (IC), are aggressively investing in 5G technology. The 5G technology can provide network transmission speeds of very high magnitudes compared with the 4G network. The integration of HMI technologies across end-user industries such as automotive, aerospace and defense, consumer electronics, healthcare, and utility is driving the demand for networks that can support high-bandwidth applications with low latency.
As a result, an increasing number of companies are focusing on developing 5G compatible devices and establishing networks as a part of the 5G network ecosystem. Strategic collaboration among the market participants will result in the development of products and services supporting the 5G technology. This will result in the development of 5G network infrastructure, which, in turn, will accelerate the demand for the market during the forecast period.
Major Network Slicing Market Challenge
The threat of cybersecurity breach is a major challenge to the growth of the global network slicing market. The adoption of 5G networks is expected to facilitate communication among connected devices in autonomous cars, electronic healthcare, smart cities, and building and home automation. The use of 5G networks enables real-time monitoring and control of various connected devices in these applications. The threat of cyberattacks will increase with the integration of 5G networks in these applications.
Cyberattacks on 5G networks can be in the form of hacking of connected devices to steal consumer data or even breaching multiple devices to create a distributed-denial-of-service (DDoS) attack on critical target servers Cyberattacks can lead to widespread security implications in the form of breaches of medical research data, unauthorized remote control of devices, unauthorized access to customer data, and patient privacy violations. Therefore, cybersecurity will be a significant challenge to the growth of the market during the forecast period.
Key Network Slicing Market Customer Landscape
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Network Slicing Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Amdocs Ltd - The company offers network slicing solutions such as design, operation, and automation. Also, the company operates in one reportable segment which design, develop, market, support, implement, and operate amdocsONE.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the solution segment will be significant during the forecast period. Access threats are reduced by using a network slicing system. Computers (software) and people who manage or configure IT infrastructure use network slicing solution tools. Systems for network slicing can be implemented as hardware appliances, on-premises software, or software as a service (SaaS). Network slicing also enables operators to reach out to new customers by providing customized solutions for various industry verticals, allowing for a large volume of customized use cases to generate entirely new revenue streams.
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The solution segment was valued at USD 81.38 million in 2017 and continue to grow by 2021. Network slicing solutions provide distinct advantages at multi-tenant enterprise campuses, where multiple enterprises with stringent connectivity requirements congregate on sites in rural areas, away from highly developed connectivity infrastructure. Compared with today's fixed connectivity options, slicing can provide greater flexibility and cost-effectiveness in these environments. For example, the new Ericsson network slicing solution has been tested in CSP networks and on commercial smartphones, and it can be smoothly introduced on top of the Ericsson 5G Core. These technologies provide relevant and useful information that assists businesses in making decisions. In the global network slicing market, rising solution acceptance is expected to grow at the fastest rate of any solution sector.
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North America is estimated to contribute 36% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The adoption of Internet of things (IoT) technology is witnessing an increase in industrial applications in North America, especially in developed economies such as the US and Canada. In the US, which is a major market in the region, the telecom sector is expected to witness substantial growth during the forecast period. The increasing adoption of wireless technologies in the US is one of the major factors driving the growth of the network slicing market in the region.
The outbreak of COVID-19 in 2020 resulted in temporary lockdowns in countries such as the US, Canada, and Mexico. However, as major companies such as Google LLC, Amazon.Com, Inc, and Intel Corp. announced permanent work from home for their employees, the demand for faster communication services increased in the region. As a result, demand for stable network connections, such as the 5G network, has increased. Furthermore, the start of large-scale COVID-19 vaccination drives in Q4 2020 resulted in the removal of restrictions, which, in turn, resulted in the revival of stalled infrastructure projects, including the development of telecommunication infrastructure in 2021. This is expected to boost the growth of the network slicing market in focus in the region during the forecast period.
The report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Network Slicing Market Scope |
|
Report Coverage |
Details |
Page number |
154 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 28.28% |
Market growth 2023-2027 |
USD 821.83 million |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
26.89 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 36% |
Key countries |
US, Canada, China, UK, and Germany |
Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled |
Aarna Networks Inc., Amdocs Ltd, Cisco Systems Inc., Deutsche Telekom AG, GSM Association, HCL Technologies Ltd., Huawei Technologies Co. Ltd., Informa Plc, International Business Machines Corp., Mavenir Systems Inc., Microsoft Corp., Nippon Telegraph and Telephone Corp., Nokia Corp., Parallel Wireless Inc., Tambora Singapore Systems Pte. Ltd., Telefonaktiebolaget LM Ericsson, Turk Telekomunikasyon AS, Viavi Solutions Inc., Vodafone Group Plc, and ZTE Corp. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Component
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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