Date: 28/11/2023

5G routers and gateways market worth $1.4 Billion in 2022 with 19% growth

According to projections, the annual revenues from the sales of cellular routers and gateways are expected to experience a compound annual growth rate (CAGR) of 12 percent until 2027, reaching a total of US$ 2.5 billion by the end of the forecast period
Berg Insight has recently released fresh insights on the cellular routers and gateways market. In 2022, over 5.6 million units of cellular routers and gateways were shipped worldwide, with a total market worth of around US$ 1.4 billion. The annual sales growth rate of 19 percent outpaced the shipment growth rate, indicating robust customer demand in a supply-constrained environment.

Multiple vendors have indicated that customers have been stockpiling inventory over the past year in order to minimize disruptions and delays in deliveries. As a consequence, there has been a deceleration in sales growth in 2023. Despite this temporary setback, the long-term trends in the cellular router market remain unchanged. However, cellular router vendors are once again facing a challenging operating environment in the short-term due to uncertain economic conditions. According to projections, the annual revenues from the sales of cellular routers and gateways are expected to experience a compound annual growth rate (CAGR) of 12 percent until 2027, reaching a total of US$ 2.5 billion by the end of the forecast period.

Cellular routers and gateways offer essential or backup cellular connectivity to devices within a local network. This product category has undergone significant advancements over the years, transforming from basic networking devices to becoming aggregation points for devices. These devices now incorporate advanced features for enhanced security and edge computing capabilities. The market for cellular routers and gateways is primarily fueled by the increasing demand to connect assets and workforces in remote and temporary locations, as businesses continue to digitalize their operations.
The cellular router and gateway market is dominated by Ericsson-owned Cradlepoint, which offers a unique subscription model that includes software and services. Sierra Wireless, now part of Semtech, is the runner up and has seen strong sales growth. Other major players include Teltonika Networks, Cisco, and Digi International. Together, these five vendors generated over $800 million in annual revenue and hold a 56% market share. Other important vendors include BEC Technologies, Belden, Casa Systems, Lantronix, MultiTech and Systech in North America; Advantech, Four-Faith, Hongdian, InHand Networks, Peplink and Robustel in Asia-Pacific; and Eurotech, HMS Networks, RAD and Westermo in the EMEA region. The European and Asia Pacific markets are fragmented with a large number of small and medium sized players that generate annual revenues in the range of US$ 5–25 million.

Nearly 10 percent of annual shipments are now comprised of 5G routers and gateways, which generate a higher share of revenues due to their premium price compared to 4G LTE devices. While many distributed enterprises have already started utilizing cellular solutions for their fast deployment time and ease of use, Berg Insight predicts that this trend will gain momentum in the 5G era. As the cost per GB decreases, 5G connectivity will become a more appealing option than fixed broadband, eventually reaching a point where the monthly fee is comparable to a fixed broadband subscription. This will expand the market for cellular routers, gateways, and modems. For more information visit: www.berginsight.com

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