A recent report by ResearchAndMarkets indicates that the global 5G materials market will register a robust double-digit growth of nearly 14.6% in terms of volume, from 2020-2027.
The new study highlights the consumption of kay materials used in 5G network infrastructure (macro and micro base stations) applications, i.e. PCB substrate materials (resins), radome materials and cabin materials.
With 5G idea starting to materialize in 2019, several countries started to lead the change from the front. The spike in new infrastructure investments in countries like China, will propel the demand for 5G equipment and materials. This has created a wave of optimism in an otherwise capital-intensive, competitive, and low-margin telecommunications infrastructure equipment industry.
The swelling size of mobile data traffic has made it imperative for us to shift to 5G networks. 5G networks are characterized by ultra-high-speed internet connectivity, low latency, and improved reliability. However, high frequencies are characterized by a high number of cycles/waves per unit time and entail larger signal losses, thereby limiting the maximum distance traveled by the waves, whose ability is limited in penetrating hard surfaces/materials.
However, 5G infrastructure entails denser networks comprising both macro and small cells or base stations. Hence the materials needed for 5G applications will be significantly different from those used in conventional or previous-generation network infrastructures.
On the other hand, COVID-19 and the political discord over the security concerns associated with 5G equipment (especially against Chinese companies) have affected the pace of 5G network deployment and collaborative development activity across geographies. Additionally, most short-term NSA deployments are expected to be in the sub-6 GHz frequency range, which overlaps with the 4G/LTE infrastructure. Few infrastructures will allow software upgrades to 5G, which will impact short-term market growth for 5G materials.
However, the commercialization of 5G standalone networks is expected to gather pace in the medium term as the shift to and the proliferation of high-functionality 5G networks entail significant upgrades in terms of equipment. The adoption and the large-scale use of specific materials for 5G applications (for both sub-6GHz and mmWave applications) will usher in a wave of innovative materials and alternatives.
The robust growth in investments in 5G, the aggressive pace of 5G base station installations, especially in China, and the inherent need for materials in 5G equipment in relation to previous-generation equipment offer strong growth opportunity for incumbents across the value chain, including material suppliers, CCL manufacturers, PCB suppliers, and equipment providers/integrators.
In addition, the market must continue to ensure agility of material supply across geographies and reduce the lead time associated with the specialty CCLs used in 5G applications.
