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5G to Drive Connectivity Infrastructure Improvements, Open Revenue Streams
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There is a lack of innovation and product differentiation in the Telecom power market, where many end users are still using old legacy systems. In order to gain market share, Telecom power manufacturers need to come up with technically advanced and innovative products that address the current customer frustrations and also evolving needs. One of the main challenges faced by the telecom operators in the 5G era is increase in power consumption which will be mainly driven by increase in the number of sites and addition of new frequency bands. This further creates challenges pertaining to site construction and maintenance. The other key cascading effects of this challenge include site modernization, increase in power density, need for additional cabinets and so on. On the other hand, as the energy consumption increases, so does the operational costs and carbon emission, leading to clean energy challenges. The other key challenge is from an operation and maintenance (O&M) perspective. Given that 5G will drive up the number of sites, operators will have to add more equipment on site; these will substantially increase complexity. It becomes highly challenging for operators to handle O&M activities through traditional methods; this will not only have an adverse effect on resource utilization, but also has a severe negative impact on O&M costs.The increase in telecommunication infrastructure spending because of 4G and 5G deployments will likely increase the demand for DC power systems. While North America and Europe are experiencing slower growth because of a large installed base of DC power systems, India, China, Latin America, the Middle East, Africa, Southeast Asia, and Australasia will continue offering high-growth opportunities. The overall market is expected to grow at a compound annual growth rate (CAGR) of 3.2% from 2019 to 2025, suggesting market maturity and strong competition. Limited product innovation leads to low margins, thus resulting in moderate growth prospects. Companies in this market are working to improve reliability, scalability, energy efficiency, product management, security, control, optimal system design, and cost-effective deployment. In addition, companies that can leverage technical and product differentiation strategies, while remaining sensitive to price, may find the competitive advantage. The emergence of 5G is expected to create significant growth opportunities in the United States, Europe, and Asia-Pacific (e.g., Japan, South Korea, and China). Because developed countries have completed the majority of their build-outs, opportunities in this market are shifting toward emerging economies in Asia-Pacific and Latin America.Author: Gautham Gnanajothi
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