In these very early days of 5G, it certainly seems on the surface that the vendor ecosystem is similar to what it has been for the past several years. The Big Three network equipment companies — Ericsson, Nokia, and Huawei — are winning the lion’s share of 5G contracts, with Samsung and ZTE gaining some share. It also appears that we’re not likely to see any major shifts in the handset ecosystem in the near future. Qualcomm remains in a strong position in the 5G chipset, licensing, and radio modem business – the biggest threat comes from the internal development on the UE side, such as Apple’s ultimate frenemy move of acquiring Intel’s modem business, barely a week after they settled their dispute with Qualcomm.
But as we truly enter the 5G era, which will move from ‘commercial trial’ phase to more broad-based network and device availability in 2020, there is an opportunity for a new wave of vendors to play a significant role. I’d like to use this column to provide a glimpse of some companies and categories of opportunity to keep your eyes on. A few caveats. First, this list is inclusive of the broader next phase of opportunity in wireless, including companies that will contribute to 5G, edge computing, new business cases and different economic/cost models. Some of these companies are [well-funded] start-ups, while others are established companies making a big play for 5G, in some cases through some recent acquisitions. Second, this is just a sample of a few companies – it is by no means exhaustive. Finally, no company has paid to be on this list or has sponsored this column in any way.
New Era of Networking
Among the companies to keep your eye on in the networking space, a few stand out. Mavenir is helping to transform mobile operator economics, with a comprehensive portfolio across nearly every layer of the network infrastructure stack. It is playing a particular role in contributing to the move to more software-oriented solutions for mobile networks.
Altiostar, which provides a 5G-ready virtualized RAN software solution, has raised more than $200 million. It is one of key vendors supplying Rakuten, a new, high-profile operator in Japan that is building the world’s first end-to-end fully virtualized, cloud-native mobile network.
Parallel Wireless. Although not a major 5G play at this point, Parallel has contracts with more than 60 smaller operators worldwide, with its pioneering 2G/3G/4G Open RAN solution consisting of a Converged Wireless System (CWS), a software-defined base station, and a fully virtualized HetNet Gateway (HNG.)
New Opportunities in Mobile Broadband
Evolved 4G and 5G networks are positioned to offer a competitive broadband solution, particularly in areas that are un-served or under-served by broadband. Starry, which has launched fixed wireless access in 5 cities covering some 2 million homes, has raised nearly $200 million and just won 104 licenses in the 24 GHz auction. Airspan has numerous solutions for network densification – they’re behind Sprint’s innovative ‘magic box’, and recently acquired Mimosa Networks, which focuses on fixed wireless solutions and adds some new IP in the massive MIMO space. Adtran is playing an important role in backhaul, customer premise, and access solutions for mobile broadband. And as opportunities in fixed wireless expand, Cambium Networks is well-positioned in certain geographic areas and parts of the radio spectrum that are not typically covered by the mainstream network equipment providers.
Opportunities in User Equipment (UE)
Although we’re not forecasting any significant near-term share shifts in the handset (smartphone) market, we believe that there’s a new breed of opportunities for wireless modems (i.e. bricks/pucks/mobile hotspots) in the consumer and enterprise space. Some notable companies include: Inseego, which has won some of the initial contracts for Advanced 4G LTE (i.e. Cat 18) and 5G networks; Cradlepoint, which provides a comprehensive suite of 4G/5G/IoT routers and edge cloud solutions; and Netgear, which has among the industry’s first 5G mobile hotspot and Wi-Fi 6 products.
Edge Computing and Storage
An important element of next generation 5G networks is bringing connectivity and content to the edge, which improves network performance and can significantly alter network economics. This will expand opportunities for established Big Tech companies to expand their business in the telecom/wireless sector. A good example here is VMware, which at the recent VMworld, laid out a compelling vision for the evolution of the telecom network as a cloud, as part of the company’s Telco NFV solutions. Seagate, one of the world leaders in storage solutions, is expanding its footprint into telecom , given opportunities in the evolution of the edge and the data center. On the start-up side, VaporIO has an innovative solution that places data centers at the base of cell towers, which brings cloud-like services to the edge of the wireless network.
CBRS/Shared Spectrum/Wi-Fi 6
Another company on our watch list is Federated Wireless, which is among the leaders enabling CBRS (shared spectrum in the 3.5 GHz band) with its Spectrum Controller platform. The coming commercial launch of CBRS is key to proving the pioneering shared spectrum model, and will play an important role in the evolution to 5G.
Finally, not that many in the broader tech ecosystem are that familiar with CommScope, a $5 billion company which for years has been a significant supplier of a range of wireless network equipment, such as antennas and amplifiers. Among the reasons to keep your eyes on them is the recent acquisition of Arris, which more than doubles the company’s revenue, and through Arris’ ownership of Ruckus, provides substantial a substantial footprint in the enterprise/telco Wi-Fi and CBRS areas. I also believe Cisco is poised to play be a bigger player in 5G. The company is in a unique position, given its broad portfolio in the enterprise, mobile, and Wi-Fi areas.
We’ll address some key players in the IoT and enterprise segments of 5G, including the industrial aspect, in a future column.