COVID-19 Pandemic Impact: Workforce Shortages and Uncertainty will Cause 5G Network Infrastructure Revenue to Drop As Much As 10% in 2020
OYSTER BAY, N.Y., April 16, 2020 /PRNewswire/ -- The outbreak of COVID-19 has created a crippling effect, not only on service industries, but also on manufacturing enterprises, including 5G infrastructure vendors. Despite the current ongoing discussion on OpenRAN and open networks, most advanced 5G networks still rely on Tier One infrastructure vendors and their supply chain has been disrupted. The shortages of component manufacturing and/or network workforce deployment, such as integration engineers, are the main reasons of this disruption. These disruptions will cause 2020 5G network infrastructure revenue to fall as much as 10% of the forecasted US$2.1 billion, states global tech market advisory firm, ABI Research.
"The current virus outbreak will likely delay the deployment of advanced 5G NR systems, including Massive Multiple Input, Multiple Output (MIMO) and active antennas that several operators have already started deploying," explains Jiancao Hou, Senior Analyst at ABI Research. 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. In the short term, 5G radio deployments will be delayed further due to geopolitical constraints and COVID-19.
"In the longer term, while 5G's momentum will be slowed, new use cases will emerge," says Hou. It is important for mobile operators to broaden their supply chain and avoid a single-vendor infrastructure market. Apart from that, the effects of the virus outbreak will likely accelerate more innovative use cases and services. "For example, considering a 5G Ultra-Reliable Low-Latency Communications (URLLC) scenario, if surgery and health monitoring can be done remotely, the doctor will not need to physically meet the patient infected with the virus."
A great lesson has been provided by the virus breakout to both network operators and related authorities. "The former should be able to manage the risk of relying on a few vendors dominating the infrastructure market. The latter should embrace new technologies and understand how these can be used in turbulent times to improve business and society," Hou recommends.
For a clearer picture of the current and future ramifications of COVID-19 across technologies and verticals, including 5G and Mobile Network Infrastructure, download the whitepaper Taking Stock of COVID-19: The Short- and Long-Term Ramifications on Technology and End Markets.
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SOURCE ABI Research
