Open RAN market forecast to fall 83% in 2024

Mobile Experts released the forecast for Open RAN, which it described as ‘the most bizarre market growth profile ever seen in the wireless market.’ After ‘great success’ with deployment in greenfield networks by the likes of DISH and Rakuten, the firm is predicting a significant slump this year.

However, it’s not all doom and gloom for Open RAN cheerleaders, as the report also notes that major mobile operators have started to make commitments to it this year, which it says will lead to new revenue growth in 2025 and 2026.

"Our revenue chart for Open RAN looks like the Grand Canyon," said Joe Madden, Principal Analyst at Mobile Experts. "All of the big clean-sheet O-RAN deployments have finished their major buildout phase, so now the market will transition to upgrades on legacy networks. But legacy networks will use Open RAN differently.

“Many people don't understand why legacy mobile operators are rejecting the original Open RAN business model and are choosing a Single Software business model instead. This report provides clear guidance on why the market is fundamentally changing."

The report goes into the expected revenue in hardware (radios, servers, antennas) and software (vDU, vCU, RIC, xApp, rApp, and dApp) through to 2029, a snippet of which is provided in the release:

Madden added: "The US Government is pumping hundreds of millions of dollars into Open RAN. But sadly, the biggest challenge of Open RAN will not be addressed by NOFO and other government grants. Each grant will be too small to fix the fundamental economic challenge of Open RU hardware. The market will solve the problem anyway, without government help."

While the projected drop Mobile Experts puts forward is larger, presumably there is some overlap in causation with what is happening in the wider global RAN market – which by some reports declined by 11% in 2023, while a report by Dell’Oro Group from halfway through the year projected that global RAN revenues will fall at a 2% CAGR over the next five years.