skip to main content
Close Icon We use cookies to improve your website experience.  To learn about our use of cookies and how you can manage your cookie settings, please see our Cookie Policy.  By continuing to use the website, you consent to our use of cookies.
Global Search Configuration

Ovum view


Ovum’s latest Telecoms Vendor Contract Databaseidentified 1,177 announcements in 2015, down 7% year over year. Announcements from CSPs were down. Non-telco purchases of telco-grade solutions are steadily rising, however – up 15% year over year, to 348 announcements (or 30% of the total). There has also been a surge of activity in three technology areas: big data, 5G, and SDN/NFV.

Contracts for big data, 5G, and SDN/NFV doubled in 2015

Ovum has long included vendor wins to non-telcos in its contract analysis – as long as the solution adopted is comparable to what telcos deploy. Non-telco announcements are now booming, accounting for 30% of announcements last year (compared to 18% in 2013). Companies in verticals such as finance, government, transport, and energy are growing their networks in scale and complexity, and vendors are benefiting. For instance, in May 2015, Spain’s national railway awarded a 10-year contract to Nokia (with help from Siemens and Thales) for the upgrade and maintenance of its GSM-R network. This unusually large deal was valued at $339m. Another significant deal took place in July, when IBM closed a five-year agreement with Columbia Pipeline Group, for cloud, mobile, analytics, and security solutions. Both deals included a mix of software, hardware, and services – common requirements for addressing the needs of other vertical markets.

The big money in network infrastructure, nonetheless, remains in the CSP vertical. CSPs still accounted for 70% of contract announcements in 2015, spending well over $300bn in capex annually (around 40% of which was on technology).

Many tech segments are seeing weaker telco activity, but 2015 data revealed a surge of contract activity relating to big data, 5G, and SDN/NFV. Some of this was due to vendors seeking to raise their profile in these emerging segments, even though the bulk of spending is years away (especially for 5G). Highlights were as follows:

  • In big data (i.e. software/data management), CSP announcements grew from 20 to 28. They grew even faster for non-telcos (up from nine to 25). Vendors in this market space include Ericsson, IBM, NEC, Netcracker, Teradata, and Oracle.

  • Because most telcos have selected their main suppliers, 4G/LTE announcements have plummeted from 219 in 2013 to 128 in 2015. However, 5G is now becoming noticeable in the contract flow. Announcements jumped from three in 2014 to 17 in 2015. These were concentrated in Korea, Japan, and China – three Asian markets that have invested heavily in 4G development (although China’s implementation was arguably late). Most of the big radio access vendors have announced 5G trials or similar activity, including Ericsson, Nokia/ALU, Huawei, NEC, and ZTE.

  • SDN/NFV is a volatile space (and a major focus of research at Ovum). Virtualization and the broader shift to software-centric networks have vast implications for telco networks and operations. They also represent a major opportunity for vendors, which are eager to establish credibility. This was reflected in contract awards: In 2015, vendors announced 62 SDN/NFV wins with CSPs, compared to less than 30 in 2014. The biggest announcement came from Alcatel-Lucent in July, which signed separate deals with China Mobile and China Unicom to support the rollout of NFV, SDN, and cloud technology, with support from Nuage Networks.

In terms of vendors’ share of announcements in 2015, Ericsson and Alcatel-Lucent led, followed distantly by Huawei, NEC, and Nokia. Infinera, Cisco, ZTE, Gemalto, Ciena, Calix, Brocade, and Juniper were also high on the list of contract winners. In non-telco vertical markets, Imagine Communications, Aruba Networks, IBM, and Harmonic Lightwave were significant.

Aside from telcos, two large segments of communications providers are building networks. Internet content providers (ICPs) from the OTT and cloud world – such as Google and Microsoft – and carrier-neutral providers (CNPs) spent more than $70bn in capex last year. About 90% of this came from the ICPs. Historically, ICPs have never announced much, preferring extensive internal development and highly customized solutions. This seems to be changing, though. Both ICPs and CNPs announced twice as many contracts in 2015. More significantly, though, we saw contract announcements in media and government verticals grow more than 40% last year.


Further reading

Telecoms Vendor Contract Database: March 2016, TE0006-001203 (March 2016)

“OTT capex exceeds $60bn in 2015 on back of data center builds,” TE0006-001187 (February 2016)

“US telco capex flattens to just below $70bn in 2015,” TE0006-001181 (January 2016)

“Telco spin-offs enable the rise of a new breed of network specialists,” TE0006-001177 (January 2016)

Communications Provider Revenue & Capex Forecast: 2015–20, TE0006-001167 (December 2015)

Communications Service Provider (CSP) Revenue & Capex Tracker: 3Q15, TE0006-001172 (December 2015)


Matt Walker, Principal Analyst, Intelligent Networks

Recommended Articles


Have any questions? Speak to a Specialist

Europe, Middle East & Africa team - +44 (0) 207 017 7700

Asia-Pacific team - +61 (0)3 960 16700

US team - +1 646 957 8878

Email us at

You can also contact your named/allocated Client Services Executive using their direct dial.
PR enquiries - Call us at +44 788 597 5160 or email us at

Contact marketing -

Already an Ovum client? Login to the Knowledge Center now