Huawei tops the global telecoms kit market, despite all odds

Despite all odds, Huawei has increased its market share as the top telecoms equipment vendor worldwide, mainly due to strong demand within mainland China through all of 2020, a recent report stated on Monday.

According to a report by U.S.-based telecom insights company Dell’Oro Group, the Chinese vendor’s share by revenue rose by 28 percent to 31 percent, ahead of Finnish Nokia’s 15 percent, Swedish Ericsson’s 15 percent, and Chinese ZTE’s 10 percent; while U.S. Cisco 6 percent, Ciena’s 3 percent, and South Korean Samsung’s 2 percent made up the rest of the top seven.

European duo Ericsson and Nokia benefitted the most of Huawei’s fall from grace by increasing their share of the RAN market as operators looked to diversify their supply pool or were required to do so because of government requests, the report explained.

“Revenue shares continued to be impacted by the state of the 5G rollouts in highly concentrated markets,” Dell’Oro said, adding that “while both Ericsson and Nokia improved their RAN positions outside of China, initial estimates suggest Huawei’s global telecoms kit market share, including China, improved by two to three percentage points for the full year 2020.”

It is notable that while the ranking order hasn’t not changed in comparison to 2019, the numbers revealed subtle changes in revenue share – in such a large industry any percentage point dropped or gained translates into billions of dollars.

Dell’Oro analysts express keenness regarding the state of the market as 5G expansion and deployments, as the worldwide workforce shift to a more long-term flexible remote hours based on the effects of the pandemic.  

On broader scale, the report noted that the global market for telecom kits came in at US$90 billion-$95 billion, an increase of 7 percent in 2020 as telcos invested in 5G rollouts and additional capacity to cope with increased demand during lockdown measures.

This is natural since peoples worldwide took strict at home quarantine measures, increasing their reliance on broadband and mobile networks for work, study, and play.

Preliminary estimates from Dell’Oro show that although there was some supply chain disruption in the early part of 2020, the market for Broadband Access, Microwave & Optical Transport, Mobile Core & Radio Access Network, SP Router & Carrier Ethernet Switch (CES) technologies benefited from the rising importance of connectivity. Overall, the pace of growth was the fastest since 2011.

The wireless industry was the strongest growth driver, with spend on RAN and mobile core networks both increasing beyond the expectations of Dell’Oro analysts. Mobile core and RAN together account for just under half of the worldwide equipment market, and growth in China has clearly made a difference to the global total.

“With investments in China outpacing the overall market, we estimate Huawei and ZTE collectively gained around 3 to 4 percentage points of revenue share between 2019 and 2020, together comprising more than 40 percent of the global telecom kit market,” the Dell’Oro report said.

While revenue figures in 2020 turned up higher than analysts predicted, they remain optimistic the trend will continue in this year, as predictions foresee a growth rate of 3 percent to 5 percent in 2021.