Mobile network optimization market to become $4.5 billion opportunity

With the advent of the iPhone, mobile data process changed rapidly, with users downloading large volumes of data over their phones, causing mobile operators to search for new solutions to help their networks handle the increased data traffic.


“In 2016, mobile network operators will spend more than $1.8 billion on web/video optimization, more than $1.2 billion on policy management, more than $1.5 billion on deep packet inspection (DPI), and billions more on other test equipment, network probes, and other optimization solutions,” said Jim Eller, principal analyst, wireless infrastructure, ABI Research.


A few years ago, optimization of mobile networks was primarily technicians in blue jeans climbing towers with RF test equipment and driving around to measure signal strength and dropped calls. Today, optimization focuses on managing the flood of data surging through mobile networks, and soon self-optimizing networks fine-tuning themselves without human intervention will be common. Blue jeans are no longer required.


Though some of the mobile network optimization revenue will go to the big network equipment vendors like Alcatel-Lucent, Ericsson, Huawei, Nokia Siemens Networks, and ZTE, most of the money will go to smaller companies specializing in technologies like DPI and video streaming.


“With so much money on the table, some of these smaller companies will be attractive targets for M&A activity,” said Aditya Kaul, practice director, mobile networks.


Most of these small start-ups are funded by venture capital. Some of the newer ones have not even shown a profit yet. But the growth potential for these companies looks very positive and the valuation of these companies is still relatively cheap. As a result, acquisitions in this space are already occurring.


By Team
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