Numerous suppliers of microwave equipment are preparing to add millimeter-wave gear to their portfolios as operators increasingly look to the latter category to provide backhaul for LTE macrocells and small cells, according to a fresh report.
Infonetics Research forecasts the global millimeter wave equipment market will grow to just under $600 million by 2017. Infonetics said the market includes unlicensed E-band, licensed E-band and W-band millimeter-wave equipment.
"The market is on track to more than double this year, followed by continued healthy growth going forward, powered by the increased use of millimeter wave for LTE macrocell backhaul and small cells--most of which use the unlicensed 60 GHz band," said Richard Webb, directing analyst for microwave and carrier Wi-Fi at Infonetics.
While BridgeWave retains its overall market share leadership, capturing just under a third of total millimeter-wave revenue in 2012, the vendor is facing an onslaught of new competition, said Infonetics. Among the major microwave vendors expected to introduce millimeter-wave products are Aviat Network, Ericsson (NASDAQ:ERIC), Fujitsu and Huawei.
Fueling the business plans for these new market entrants is the fact that increasing numbers of mobile operators are turning to millimeter wave to augment their existing microwave macrocell backhaul deployments. "The enhanced capacities made possible by millimeter wave are proving to be a viable solution for backhaul in metro areas where range limitations aren't always problematic," said Webb.
Meanwhile, the microwave backhaul market is also continuing to grow. Microwave equipment will constitute 56 percent of mobile backhaul revenue by 2017, said Infonetics.
The total mobile backhaul market continues to expand, driven by increased spending on backhaul for macrocells as well as small cells.
Source: Infonetics Research
"While its revenue growth rate is slowing, macrocell mobile backhaul equipment remains a huge market, with annual spending up in the $8 to $9 billion range over the next years. Just a few years ago in 2009, the market was worth under $5 billion," said Michael Howard, Infonetics co-founder and principal analyst for carrier networks.
The small cell backhaul equipment market, meanwhile, is expected to total a cumulative $5 billion from 2012-2016, according to Infonetics.
Key drivers for mobile backhaul expansion are "the ongoing HSPA/HSPA+ onslaught across the 3GPP world and growing LTE deployments by 3GPP2 players," said Howard. "If you don't have packet backhaul, there's no way to handle HSPA and HSPA+. Ethernet and microwave backhaul spending are fueling the whole market."
Huawei and Alcatel-Lucent (NYSE:ALU) are tied for the Ethernet access device/gateway and Ethernet router revenue market share lead, said Infonetics, which gave Ericsson top ranking in mobile backhaul microwave equipment.
- see this Infonetics release and this release
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