The increase in the number of smartphone subscribers around the world has led to a huge demand for data traffic, prompting network operators to upgrade their infrastructure. This trend, according to market research firm Technavio, will push the global next-generation mobile backhaul networks market to grow at a CAGR of over 10% by 2021.

"The mobile backhaul capacity needed per base station varies considerably, relying on target data rates and population density," said Jujhar Singh, a lead analyst from Technavio, specialising in research on embedded systems sector. "The market is calculated by considering the revenue of the vendors in the backhaul network service."

20170808_EETI_Technavio-mobile-backhaul-market (cr) Figure 1: The global next-generation mobile backhaul networks market will grow at a CAGR of over 10% by 2021. (Source: Technavio)

Development of 5G network is one of the emerging trends driving the global mobile backhaul networks market, according to the firm. By 2021, 5G is set to overtake the 4G technology in the developed markets, and the backhaul equipment makers and network carriers are already in the process of developing the next-generation mobile communication.

Some manufacturers like Intel are manufacturing consumer devices that can use millimetre wave or the sub 6GHz frequency spectrums. When this technology becomes mainstream, Technavio expects more equipment makers will manufacture the backhaul equipment to capture the market in its earlier stages.

The market is witnessing the development of IoT devices like HVAC, lighting, security and inventory management. Also, the research is oriented toward connected vehicles, smart grids and home automation to improve the quality of life. With this development toward connecting more everyday devices to the internet, there will be a huge demand for data.

With the current backhaul network supporting 4G and 3G, the current network is unable to meet the existing consumer needs. It is imperative that the network carriers deploy more fibre optics and microwave equipment in their existing infrastructure, according to the firm.

5G networks are expected to reach GB level in the forecast period. However, it is a great challenge to provide 5G wireless backhaul traffic effectively. Wireless backhaul traffic is due to two typical network architectures, including small cell and millimetre wave. Thus, demand for millimetre wave equipment market will increase over the forecast period.

“The data transfer demand is increasing at a high rate, which is expected to increase further in the forecast period. This is propelling the demand for high bandwidth applications. Also, millimetre wave technology is extensively used in the small cell backhaul network,” said Singh.