Gervice Provider Network Infrastructure Market Overview
Service Provider Network Infrastructure Market Size was estimated at 325.71 (USD Billion) in 2022. The Service Provider Network Infrastructure Market Industry is expected to grow from 354.38(USD Billion) in 2023 to 757.4 (USD Billion) by 2032. The Service Provider Network Infrastructure Market CAGR (growth rate) is expected to be around 8.8% during the forecast period (2024 - 2032).
Key Service Provider Network Infrastructure Market Trends Highlighted
The Service Provider Network Infrastructure market is changing in a dramatic way, mainly due to the worldwide acceptance of cloud computing, virtualization and the popularity of connected devices. The prevailing trends of consumer onboarding of 5G networks, edge computing as well as software-defined networks have created a requirement and appetite for network infrastructure solutions that are highly scalable, more agile and less costly.
Some of the market drivers include increasing amounts of data traffic, the desire for faster and seamless operations and coordination of networks, as well as the integration of the latest techniques like artificial intelligence and machine learning. In particular, it concerns network slicing, network function virtualization and open source integration. Other MSP key trends include the convergence of fixed and mobile networks, development of cloud-native network solutions and multi-cloud strategy. In this essence, the main competition within the industry is centered on the provision of next-generation network infrastructures that combine these technologies and effectively respond to the changing needs of the market.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Service Provider Network Infrastructure Market Drivers
Increasing Demand for Enhanced Network Connectivity
The rising adoption of cloud-based applications, the Internet of Things, and high-bandwidth multimedia content drive the demand for networking equipment among carriers. The providers are making huge investments in their networks to meet the ever-increasing bandwidth and latency adequately needed on the part of their subscribers. In addition, 5G networks are gaining momentum worldwide, meaning that an advanced network infrastructure will be in demand.This is because while 5G enabled low latency and high speed of data exchanges, it also required stronger and more reliable network infrastructure as its foundation. As a result, the Service Provider Network Infrastructure Market Industry grows.
Growing Adoption of Software-Defined Networking (SDN) and Network Function Virtualization (NFV)
SDN and NFV are new technologies that are taking on increasing importance in changing the nature of network design and management. SDN uses a centralized control plane to the traditional distributed router and switches data planes. SDN also allows for the programmability of network management and services.
NFV involves the virtualization of network functions such as firewalls, load balancers, and routers. By using servers, storage, and switches, NFV becomes more agile, cost-effective, and scalable.For this reason, SDN and NFV are forecasted to positively impact the developments of the Service Provider Network Infrastructure Market industry.
Government Initiatives to Promote Broadband Infrastructure Development
Governments are increasingly becoming aware of the importance of cost-effective broadband infrastructure in economic and social development. As a result, they implement a variety of programs and policies that aim at promoting the development and expansion of broadband networks. Among the most common initiatives are direct subsidies for the construction of broadband infrastructure, simplification of regulatory processes, and investment in research and development.
Overall, the role of government subsidies in the development of the Service Provider Network Infrastructure Market Industry seems to be substantial since they can greatly reduce the costs and effort required for building broadband networks.
Service Provider Network Infrastructure Market Segment Insights
Service Provider Network Infrastructure Market Infrastructure Type Insights
The Service Provider Network Infrastructure Market is segmented into various types of infrastructure, including Packet Optical Transport, IP/MPLS Networks, Software-Defined Networking (SDN), Network Function Virtualization (NFV), and Cellular Backhaul. Packet Optical Transport is expected to hold the largest market share in the coming years, driven by the increasing demand for high-speed connectivity and bandwidth-intensive applications.
IP/MPLS Networks are also expected to witness significant growth due to their ability to provide reliable and scalable network connectivity.Software-defined networking (SDN) is gaining traction as it enables network programmability and automation, leading to improved network flexibility and efficiency. Network Function Virtualization (NFV) is another emerging technology that helps consolidate network functions into software, reducing hardware costs and improving network agility.
Cellular Backhaul is a crucial segment of the Service Provider Network Infrastructure Market, providing connectivity between mobile base stations and the core network. The increasing adoption of 5G networks is driving the growth of this segment, as 5G requires higher bandwidth and lower latency connectivity.Overall, the Service Provider Network Infrastructure Market is expected to witness robust growth in the coming years, driven by the increasing demand for high-speed connectivity, cloud computing, and mobile broadband services.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Service Provider Network Infrastructure Market Service Type Insights
The Service Type segment of the Service Provider Network Infrastructure Market is anticipated to witness substantial growth in the coming years. Managed Services, which accounted for the largest share of the market in 2023, are expected to maintain their dominance throughout the forecast period. The increasing adoption of cloud-based services and the need for efficient network management are driving the demand for Managed Services.
Network-as-a-Service (NaaS) is another key segment, projected to grow significantly due to its flexible and cost-effective nature.Virtual Network Functions (VNFs) are also gaining traction as they enable network operators to virtualize network functions and improve agility. Professional Services and System Integration Services are essential for the planning, deployment, and maintenance of network infrastructure, contributing to the overall growth of the Service Type segment.
Service Provider Network Infrastructure Market Application Insights
The Service Provider Network Infrastructure Market is segmented by Application into Enterprise Networking, Cloud Computing, Video Delivery, Mobile Backhaul, and Fixed Broadband Access. Among these segments, Cloud Computing is expected to hold the largest market share in 2023, accounting for around 35% of the Service Provider Network Infrastructure Market revenue.
This growth is attributed to the increasing adoption of cloud-based services and applications by enterprises of all sizes. The Enterprise Networking segment is expected to be the second-largest segment, with a market share of around 25% in 2023.The growth of this segment is driven by the increasing demand for high-speed and reliable network connectivity for enterprise applications and services.
Service Provider Network Infrastructure Market Deployment Model Insights
The deployment model segment of the Service Provider Network Infrastructure Market is categorized into on-premises, cloud-based, managed services, software as a service (SaaS), and network functions virtualization (NFV). The cloud-based deployment model is projected to grow at a significant rate during the forecast period, owing to its cost-effectiveness, scalability, and flexibility. The increasing adoption of cloud-based services by service providers is driving the growth of this segment.
The on-premises deployment model is expected to hold a substantial market share, as many service providers prefer to maintain control over their network infrastructure.Managed services are gaining traction, as they offer a comprehensive suite of services, including network design, deployment, and maintenance, allowing service providers to focus on their core competencies. SaaS and NFV are emerging deployment models that are expected to contribute to market growth in the coming years.
Service Provider Network Infrastructure Market Regional Insights
The regional segmentation of the Service Provider Network Infrastructure Market offers valuable insights into the market's dynamics across different geographies. In 2023, North America held the largest market share, accounting for approximately 38.9% of the global revenue. This dominance is primarily driven by the presence of major cloud service providers, advanced network infrastructure, and high demand for bandwidth-intensive applications.
Europe follows closely, contributing approximately 32.5% to the global market. The region benefits from government initiatives to enhance connectivity and the presence of established telecommunications operators.APAC is projected to witness robust growth during the forecast period, with a significant contribution from countries like China, India, and Japan. This growth is attributed to the rapidly expanding data center market, increasing mobile data consumption, and government investments in network infrastructure. South America and MEA hold a smaller market share but are expected to experience steady growth due to increasing internet penetration and the rollout of 5G networks.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Service Provider Network Infrastructure Market Key Players And Competitive Insights
Service Provider Network Infrastructure Market is being constantly revolutionized by the innovating forces of the major playmakers in the industry. The leading players in the service provider network infrastructure market are constantly investing in the research and development of new technologies to manufacture products that are value-added and meet the emerging needs of the customers.
The growth of the service provider network infrastructure market is being facilitated by the growing demand for bandwidth, the increasing use of mobile devices and the rising popularity of cloud computing. Until 2027, the Service Provider Network Infrastructure Market Competitive Landscape is expected to remain cut-throat competitive. Huawei is a leading global player in providing the solutions of the Service Provider Network Infrastructure Market.
It is a China-based company that majorly provides routers, switches and optical transport systems. The company is focusing on expanding its business operations from China to other regions of the world. The company is also leading in the spending on research and development on creating new products. Thus, it is one of the major players in the service provider network infrastructure market and is expected to remain so in the next decade.
Cisco is another major international player supplying the solutions of service provider network infrastructure market. It provides routers, switches and security solutions to the customers. Cisco is a North American company that also provides supplies in the European market. Like Huawei, Cisco too, is expanding its business operations to other parts of the world and is also a leading company in innovation and research and development. So, Cisco is also one of the major players in the service provider network infrastructure market and is expected to remain so in the next decade.
Key Companies in the Service Provider Network Infrastructure Market Include
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Ciena Corporation
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Infinera Corporation
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CommScope
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Nokia
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H3C Technologies
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Dell Technologies
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Huawei
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Adtran
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Ericsson
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Samsung Electronics
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Juniper Networks
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NEC Corporation
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Cisco Systems
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ZTE
Service Provider Network Infrastructure Market Industry Developments
The Service Provider Network Infrastructure Market is projected to reach USD 757.4 billion by 2032 from USD 354.38 billion in 2023, exhibiting a CAGR of 8.8% during the forecast period. This growth can be attributed to the increasing demand for high-speed internet, cloud services, and the deployment of 5G networks.Recent developments in the market include:- In 2022,
Verizon announced a plan to invest USD 10 billion in its network infrastructure over the next three years.- In 2023, AT&T announced the launch of its 5G network in 30 new cities.- In 2023, Lumen Technologies announced the acquisition of Level 3 Communications, which will expand its fiber network footprint.These developments are expected to further drive the growth of the Service Provider Network Infrastructure Market in the coming years.
Service Provider Network Infrastructure Market Segmentation Insights
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Service Provider Network Infrastructure Market Infrastructure Type Outlook
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Service Provider Network Infrastructure Market Service Type Outlook
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Managed Services
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Network-as-a-Service (NaaS)
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Virtual Network Functions (VNFs)
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Professional Services
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System Integration Services
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Service Provider Network Infrastructure Market Application Outlook
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Enterprise Networking
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Cloud Computing
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Video Delivery
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Mobile Backhaul
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Fixed Broadband Access
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Service Provider Network Infrastructure Market Deployment Model Outlook
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Service Provider Network Infrastructure Market Regional Outlook
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North America
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Europe
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South America
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Asia-Pacific
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Middle East and Africa
| Report Attribute/Metric |
Details |
| Market Size 2022 |
325.71(USD Billion) |
| Market Size 2023 |
354.38(USD Billion) |
| Market Size 2032 |
757.4(USD Billion) |
| Compound Annual Growth Rate (CAGR) |
8.8% (2024 - 2032) |
| Report Coverage |
Revenue Forecast, Competitive Landscape, Growth Factors, and Trends |
| Base Year |
2023 |
| Market Forecast Period |
2024 - 2032 |
| Historical Data |
2019 - 2022 |
| Market Forecast Units |
USD Billion |
| Key Companies Profiled |
Ciena Corporation, Infinera Corporation, CommScope, Nokia, H3C Technologies, Dell Technologies, Huawei, Adtran, Ericsson, Samsung Electronics, Juniper Networks, NEC Corporation, Cisco Systems, ZTE |
| Segments Covered |
Infrastructure Type, Service Type, Application, Deployment Model, Regional |
| Key Market Opportunities |
5G network expansion Cloud and edge computing adoption Network virtualization Software-defined networking Internet of Things IoT |
| Key Market Dynamics |
Growing demand for cloud and edge computing Network transformation driven by 5G and fiber broadband Increasing adoption of software-defined networking SDN and network function virtualization NFV Rise in data traffic and network complexity Government initiatives and regulations |
| Countries Covered |
North America, Europe, APAC, South America, MEA |
Frequently Asked Questions (FAQ) :
The Service Provider Network Infrastructure Market is projected to be valued at 354.38 billion U.S. dollars in 2023.
The Service Provider Network Infrastructure Market is projected to register a CAGR of 8.8% from 2024 to 2032.
The Service Provider Network Infrastructure Market is projected to be valued at 757.4 billion U.S. dollars in 2032.
North America is expected to have the largest market share in the Service Provider Network Infrastructure Market in 2023.
The cloud computing segment is expected to have the highest growth rate in the Service Provider Network Infrastructure Market from 2023 to 2032.
Some of the key competitors in the Service Provider Network Infrastructure Market include Cisco Systems, Inc., Huawei Technologies Co., Ltd., Nokia Corporation, Ericsson AB, and Juniper Networks, Inc.
Some of the key trends driving the growth of the Service Provider Network Infrastructure Market include the increasing adoption of cloud computing, the growing demand for bandwidth, and the need for improved network security.
Some of the challenges facing the Service Provider Network Infrastructure Market include the rising cost of network infrastructure, the increasing complexity of network management, and the need for skilled network engineers.
Some of the opportunities for growth in the Service Provider Network Infrastructure Market include the development of new network technologies, the expansion of broadband networks, and the increasing demand for managed network services.
Some of the key factors that will shape the future of the Service Provider Network Infrastructure Market include the increasing adoption of 5G technology, the growth of the Internet of Things (IoT), and the need for improved network security.
