Worldwide spending on network planning and optimisation software reached almost USD500 million in 2011

Driven by the growth of video-based services and new data transport technologies, spending in this market will grow at a 7% CAGR between 2011 and 2016 – but operator budgets are not limitless.

Telecoms operators worldwide spent USD488 million on network planning and optimisation software in 2011 and the market will grow at a 7% CAGR between 2011 and 2016, according to new research from Analysys Mason. The growth – more than three times the CAGR of operator revenue from telecoms services – is being driven by the explosion of data usage because of video streaming, the introduction of LTE technologies, the increasing complexity of networks that include Wi-Fi and small-cell solutions, and the increased focus of operators on improving the customer experience.

As well as forecasting worldwide expenditure, the report, Network planning and optimisation outlook 2012, analyses where the growth will come from by service segment and region, and why.

Of the four service segments examined (mobile, public switched telephone networks (PSTN), business, and residential broadband), spending on software for mobile services is predicted to grow at a CAGR of 8.4% between 2011 and 2016, while PSTN is predicted to grow by just 3.3% during the same period.

“Spending on network planning and optimisation software will increase dramatically, particularly in the data services segment, and this will continue with the transition to the 4G technology of LTE,” explained Mark Mortensen, Prinicpal Analyst, lead author of the report and lead analyst of Analysys Mason’s Service Fulfilment and Customer Care research programmes. “Complex heterogeneous mobile network architecture is making sophisticated planning and optimisation systems necessary for operators, as is a renewed focus on customer satisfaction as a competitive advantage.”

The Caribbean and Latin America (CALA) is the region that is predicted to have the highest CAGR (12%) in spending in the network planning and optimisation software market during the forecast period, while growth in Europe, the Middle East and Africa (EMEA) is predicted to be less than half that – 5.2%.

“Deal activity is expected to continue to pick up in Latin America, while persisting economic and market uncertainties in Europe will curtail growth to some extent,” Mortensen added.

The report also includes a range of key recommendations for operators and vendors. Operators’ budgets are not limitless, so it is crucial for them to understand where and how to invest limited financial resources. The report suggests that operators must focus on integrating network planning and optimisation software into their operations. Additionally, fixed operators that are introducing new video services should look to the market-driven integrated operation support systems (OSS) approach to planning, optimisation and software, rather than the traditional tools approach.

For vendors, the report recommends adding a particular set of value-added features to their services. Also, vendors of radio frequency (RF) planning and optimisation software need to rapidly evolve their systems in a number of ways in the next five years, such as including the usage of performance data from the network (rather than drive test data), and making sure that planning systems are cognisant of the new equipment options for providing mobile voice and data services.

The report also details the latest developments in the network planning and optimisation software market, such as:

  • increasing automation in the engineering work centre
  • the rise of optimisation and the demise of drive testing
  • the entry of leading inventory vendors into network planning and optimisation
  • the promise of self-organising/optimising networks (SONs).

Network planning and optimisation outlook 2012 is available for purchase (USD4999), or as part of a subscription to Analysys Mason’s Service Fulfilment research programme. For more information, contact us at research@analysysmason.com.