Network Slicing Market Statistics: 2027
The global network slicing market size was valued at $172.56 million in 2019, and is projected to reach $921.02 million by 2027, registering a CAGR of 23.7% from 2020 to 2027. Network slicing is a process of creating multiple unique virtualized and logical networks over a common multi-domain infrastructure. With the use of network functions virtualization (NFV), software-defined networking (SDN), orchestration, automation, and analytics, mobile network operators can quickly create network slices to support a specific application, set of users, service, or network. The use of network slicing enables single network to offer various services based on the requirements of the user as well as various use cases. Also, it helps network operators to reduce operating expenses (OPEX) and capital expenditure (CAPEX) along with the improved operational efficiency and time to market for the delivery of network services.
On the basis of component, the solution segment exhibited the highest growth in the network slicing market in 2019, and is expected to maintain its dominance in the upcoming years, due to the increase in adoption of network slicing solutions by communication service providers to significantly accelerate the time for delivering new applications and services. In addition, the market players are introducing advanced network slicing solutions to serve various needs of their customers. However, the services segment is expected to witness the highest growth, due to an extensive adoption of deployment and integration services among end users, as it ensures effective functioning of network slicing solution throughout the process.
By end user, the global network slicing market share was dominated by the telecom operators segment in 2019 and is expected to maintain its dominance in the upcoming years, due to the increasing demand for better speed as well as bandwidth connectivity to serve customer needs. In addition, the leading telecom operators across the globe are actively partnering with network solution providers to test the network slicing technology capabilities. However, the enterprise segment is expected to witness the highest growth, owing to the demand for robust network solutions to enhance productivity among enterprises.
North America dominates the network slicing market, as the region is early adopter of 5G services in areas such as autonomous driving, augmented reality (AR), virtual reality (VR), and artificial intelligence (AI). In addition to this, government initiatives for the development of 5G telecom infrastructure in the region is significantly fueling growth of the market. For instance, in February 2019, the Federal Communication Commission (FCC) announced a strategy to facilitate 5G technology in America. This strategy included key components upgrading the existing telecom network infrastructure, forwarding more spectrum into the market, and modernizing the outdated regulations and laws. However, Asia-Pacific is expected to observe highest growth rate during the forecast period, owing to the extensive adoption of mobile devices across the developing countries such as China and India.
The report focuses on the growth prospects, restraints, and network slicing market analysis. The study provides Porter’s five forces analysis of the network slicing industry to understand the impact of various factors such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers on the network slicing market trends.
Segment review
The network slicing market is segmented on the basis of component, type, application, end user, industry vertical, and region. On the basis of component, it is categorized into solution and services. Depending on end user, it is divided into telecom operators and enterprises. On the basis of industry vertical it is categorized into manufacturing, healthcare, automotive, media & entertainment, transport & logistic, BFSI, government and others. Region wise, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
COVID Impact Analysis
The COVID-19 pandemic has significantly pushed demands for broadband services with the help of growing mobile networking and remote access services in several industries such as retail, telecom, IT, and healthcare. As businesses around the globe have started to reopen, communications service providers are shifting their focus to 5G rollouts, and are accelerating investments in network slicing. In addition, COVID-19 has driven the demand for 5G use cases such as remote office, telemedicine, remote education, and robotics, which further boost the growth of the network slicing market. In addition, the market players have introduced innovative network slicing products during the pandemic to ensure better network slicing services. This factor drives the market growth. For instance, in October 2020, Nokia announced the solution to offer automation of 4G & 5G network slicing across all network domains, including RAN, core, and transport. It has introduced new network management, orchestration, and controller capabilities to its solution, enabling mobile operators to deliver and assure network slicing services.
By Component
Service segment is projected as one of the most lucrative segments.
Top impacting factors
The growth of the global network slicing market is mainly driven by factors such as increase in demand for next generation 5G network to enable better speed and bandwidth capabilities; rise in use cases of network slicing for Industry 4.0; and development of smart cities and smart services. In addition, rise in demand for network performance due to growth in mobile data-traffic volumes fuels demand for network slicing. Moreover, the proliferation of software-defined networking (SDN) and network function virtualization (NFV) is projected to drive market growth. However, security concerns associated with network slicing are expected to hamper the market growth to some extent. On the other hand, emerging applications across government, industrial, and enterprises sectors expected to provide lucrative opportunities for the network slicing market growth during forecast period. Also, rise in adoption for remote surgery and autonomous vehicle is anticipated to be opportunistic for the market growth during the network slicing market forecast period.
Increase in demand for next generation 5G network to enable better speed and bandwidth capabilities
5G has brought better speed and bandwidth capabilities as compared to the previous generation mobile networks. In addition, it has also brought the ability to create isolated virtual networks. The virtual networks can have different design parameters for bandwidth, latency, security, reliability, coverage, and service levels and thus be designed to serve specific solution/application needs optimally over the 5G physical radio and core infrastructure. Network slicing is projected to play a pivotal role in the enablement of 5G. Hence, this factor significantly drives the growth of the network slicing market.
By Industry Vertical
Media & entertainment industry is projected as one of the most lucrative segments.
The proliferation of software-defined networking (SDN) and network function virtualization (NFV)
SDN and NFV are network virtualization technologies that are moving modern networks to the software-based automation. These technologies are leading the digital transformation of network infrastructure across the telecom industry. With NFV, network functions such as load balancing, routing, and firewalls are delivered by virtual machines. While, SDN enables network administrators to provide services throughout the network irrespective of the hardware components. Both SDN and NFV provide the ingredients required for network slicing.
In addition, NFV and SDN serving as a basis for network slicing, allowing network slicing to provide agile installations of networks to meet the requests of various services and applications.
By Region
Asia-Pacific is projected as one of the most significant region.
Key Benefits For Stakeholders
- This study includes the network slicing market analysis, trends, and future estimations to determine the imminent investment pockets.
- The report presents information related to key drivers, restraints, and network slicing market opportunity.
- The network slicing market size is quantitatively analyzed from 2019 to 2027 to highlight the financial competency of the industry.
- Porter’s five forces analysis illustrates the potency of buyers & suppliers in network slicing market.
Network Slicing Market Report Highlights
| Aspects | Details |
 By Component |
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 By End User |
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 By Industry Vertical |
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 By Region |
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 Key Market Players | CISCO SYSTEMS INC., HUAWEI TECHNOLOGIES CO., LTD., HEWLETT PACKARD ENTERPRISE, ZTE, SAMSUNG, MAVENIR, ARGELA TECHNOLOGIES, AFFIRMED NETWORKS INC., NOKIA, TELEFONAKTIEBOLAGET LM ERICSSON |
Analyst Review
According to the CXOs of leading companies, the network slicing market is going through enormous transformation and growth. Network slicing has become the network operators’ answer to build as well as manage a network to meet emerging requirements from a wide range of enterprises. In recent times, the market has experienced an exponential growth as the network slicing has provided an opportunity for service providers to offer distinguished slice-based services on a per-use-case basis as well as it has provided enterprises with slice-level control and the essential mechanisms to self-provision connectivity. In addition, there has been an increase in adoption of network slicing owing to rise in deployment of 5G, as the communication service providers (CSPs) are looking to use network slicing to sell value-added digital services.
In addition, with 5G and network slicing, service providers are offering new services such as augmented reality (AR), virtual reality (VR), and cloud gaming with guaranteed performance to the enterprise, by opening access to potential new sources of revenue. For instance, A joint study published in September 2017 and conducted by BT, a British multinational telecommunications holding company and Ericsson found that using operational automation and network slicing, the introduction of new IoT services generated 35% more revenue over five years than a single multi-service network. In addition, it also resulted in a reduction of operational expenses of 40 % and an increase in the overall economic benefit of 150%.
Moreover, the COVID-19 pandemic has significantly pushed the growth rate of the network slicing market owing to increasing demands for broadband services with the help of growing mobile networking and remote access services in several industries such as retail, telecom, IT, and healthcare. Furthermore, deployment of wireless networking services in the upcoming years is anticipated to positively impact the network slicing market growth.
The CXOs further added that the network slicing market is competitive and comprises number of regional and global vendors competing based on factors such as cost of solutions, reliability, and support services. The growth of the market is impacted by rapid advances in the network technologies offerings, whereas the vendor performance is impacted by COVID-19 conditions and industry development. Owing to the competition, vendors operating in the market are offering advanced network visualization technology products and services to improve the network infrastructure, driving the market growth. In addition, the key players in the market are actively introducing innovative network slicing products to enhance their market presence. For instance, in October 2020, Nokia introduced a 4G and 5G automation network slicing solution suitable for vendors seeking to cut the costs related with increasing networking capacity.
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