March 10, 2021, Burlingame, California, USA

During 4Q21 the total market (PCRF + PCF) grew 24% sequentially but was up just 2% versus 4Q20 to $282 million. During the quarter, 44% of the total market was comprised of PCF revenues, with 82% coming from Asia Pacific and in particular, China. The year-over-year growth rate was clearly boosted by PCF revenues from China, which continues to transition away from PCRF—and to PCF—faster than expected. China ended 2021 with approximately 730 million 5G subscriptions, or nearly 70% of the global total. While the market is at the very early stages of transitioning to PCFs, the PCRF market also continues to transition away from legacy, appliance-based PNFs to virtual and cloud-native network functions. In 4Q21, 62% of PCRF session license shipments were of virtual- and cloud-native-based network functions, with the remaining 38% destined for legacy, PNF systems. This compares to 57% of the market in 4Q20 being comprised of VNF and CNF license shipments.

The market leaders in 4Q21 were: Huawei, Ericsson, Nokia, Oracle, and Cisco. Ericsson and Nokia gained market share versus 4Q20 as Huawei remained stable.

Since production, Standalone (SA) core networks at scale are still limited to a very small number of network operators, PCF shipments will be sporadic and very focused on specific regions and countries. This began to change in 3Q21 as other vendors started to recognize material amounts of product-related PCF and other 5G core network revenue.

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