The virtual customer premise equipment (vCPE) market refers to the market for software-based networking solutions that enable the virtualization of traditional customer premise equipment (CPE) functions. CPE stands for customer premises equipment, which includes hardware-based devices including routers, switches, firewalls, and other networking equipment deployed at the client's site. These hardware-based CPE functions are virtualized and run as software applications on COTS hardware or in a cloud environment in the vCPE market. Since actual hardware is not required on the customer's premises owing to virtualization, management is easier, expenses are lower, and flexibility and scalability are increased. Service providers or businesses remotely deploy and centrally administer a variety of networking functions and services with vCPE solutions. These capabilities include load balancing, routing, switching, network security, and WAN optimization. vCPE enables dynamic provisioning, quick service deployment, and simpler management & maintenance by virtualizing these functions.
Moreover, the virtualized consumer electronics (vCPE) market growth is being propelled by the surge in use of SDN (software defined networking) and NFV (network function virtualization) technologies. SDN allows centralized network management and programmability by separating the control plane from the data plane. Instead of using specialized hardware appliances, NFV virtualizes network services to run on common servers, storage, and switches. The vCPE industry has expanded into a number of sectors, including cloud service providers, managed service providers, corporations, and telecommunications. It provides advantages such as cost savings, flexibility, scalability, and easier network management. In addition, the supply of value-added services is made possible by vCPE, which improves network security and performance. The vCPE market, which offers flexibility, cost savings, and streamlined management, consists of software-based solutions that virtualize conventional customer premises equipment services. In the upcoming years, the vCPE industry is anticipated to experience considerable development and adoption as SDN and NFV technologies continue to develop. Furthermore, the supply of value-added services is made possible by vCPE, which helps to improve network security and performance. The vCPE market, which offers flexibility, cost savings, and streamlined management, consists of software-based solutions that virtualize conventional customer premises equipment services.
Moreover, the adoption of network virtualization in business, the reduction of reliance on hardware, and the quick development of 5G networks primarily drive the growth of the virtual customer premises equipment market. However, network virtualization security issues hamper market growth to some extent. Moreover, the demand for scalable and adaptive network solutions is likely to increase, creating attractive opportunities for market expansion during the forecast period.
On the basis of component, the global virtual customer premises equipment market share was dominated by the solution segment in 2022 and is expected to maintain its dominance in the upcoming years, owing to the demand for robust virtual capabilities, ease of use, compatibility with different platforms, and integration with existing infrastructure. However, the service segment is expected to witness the highest growth, owing to the increasing adoption of virtual services in several organizations to provide convenience, expertise, and all-time support, allowing organizations to focus on their core business functions.
By region, North America dominated the market share in 2022 for the virtual customer premises equipment market. The region has a strong foothold of numerous large enterprises, government agencies, and organizations with a huge focus on virtual premises. However, Asia-Pacific is expected to exhibit the highest growth during the forecast period. The region is experiencing a rapid digital transformation across various industries, including healthcare, finance, government, and telecommunications, which is expected to provide lucrative growth opportunities for the market in this region.
Moreover, the virtualized consumer electronics (vCPE) market growth is being propelled by the surge in use of SDN (software defined networking) and NFV (network function virtualization) technologies. SDN allows centralized network management and programmability by separating the control plane from the data plane. Instead of using specialized hardware appliances, NFV virtualizes network services to run on common servers, storage, and switches. The vCPE industry has expanded into a number of sectors, including cloud service providers, managed service providers, corporations, and telecommunications. It provides advantages such as cost savings, flexibility, scalability, and easier network management. In addition, the supply of value-added services is made possible by vCPE, which improves network security and performance. The vCPE market, which offers flexibility, cost savings, and streamlined management, consists of software-based solutions that virtualize conventional customer premises equipment services. In the upcoming years, the vCPE industry is anticipated to experience considerable development and adoption as SDN and NFV technologies continue to develop. Furthermore, the supply of value-added services is made possible by vCPE, which helps to improve network security and performance. The vCPE market, which offers flexibility, cost savings, and streamlined management, consists of software-based solutions that virtualize conventional customer premises equipment services.
Moreover, the adoption of network virtualization in business, the reduction of reliance on hardware, and the quick development of 5G networks primarily drive the growth of the virtual customer premises equipment market. However, network virtualization security issues hamper market growth to some extent. Moreover, the demand for scalable and adaptive network solutions is likely to increase, creating attractive opportunities for market expansion during the forecast period.
On the basis of component, the global virtual customer premises equipment market share was dominated by the solution segment in 2022 and is expected to maintain its dominance in the upcoming years, owing to the demand for robust virtual capabilities, ease of use, compatibility with different platforms, and integration with existing infrastructure. However, the service segment is expected to witness the highest growth, owing to the increasing adoption of virtual services in several organizations to provide convenience, expertise, and all-time support, allowing organizations to focus on their core business functions.
By region, North America dominated the market share in 2022 for the virtual customer premises equipment market. The region has a strong foothold of numerous large enterprises, government agencies, and organizations with a huge focus on virtual premises. However, Asia-Pacific is expected to exhibit the highest growth during the forecast period. The region is experiencing a rapid digital transformation across various industries, including healthcare, finance, government, and telecommunications, which is expected to provide lucrative growth opportunities for the market in this region.
Segment Review
The virtual customer premises equipment market is segmented on the basis of component, deployment, enterprise size, application, and region. On the basis of component, it is bifurcated into solution and services. On the basis of deployment, it is segregated into on-premise and cloud. On the basis of enterprise size, it is fragmented into large enterprise and SMEs. On the basis of application, it is categorized into data center and telecom service providers and enterprise. On the basis of enterprises, it is categorized into BFSI, IT, government and public sector, manufacturing, healthcare and others. On the basis of region, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.COVID-19 Impact Analysis
The COVID-19 pandemic's effects on the virtual customer premise equipment (vCPE) market size have been conflicting. While it has caused certain difficulties, it has also produced fresh chances for development. The demand for flexible and scalable networking solutions as well as the rise in remote working have both had significant effects of COVID-19 on the virtual customer premise equipment (vCPE) market. Demand for vCPE solutions to allow safe and dependable connectivity for remote employees increased as organizations shifted to remote work models. As a result, the market size increased and the adoption of vCPE technology was accelerated. The pandemic also brought to light the significance of flexibility and scalability in network infrastructure. To adapt to shifting business needs, organizations needed to be able to quickly supply and deploy networking operations remotely. The flexibility and scalability that vCPE solutions provided to satisfy these expectations, as a result of being virtualized and software-based, contributed to the market's continued growth. On the other hand, the virtual customer premise equipment (vCPE) market also faced difficulties as a result of the COVID-19 outbreak. Budget restrictions brought on by the pandemic's economic slump prevented many organizations from investing in new technologies like vCPE. Due to financial uncertainty, several businesses may have postponed or cut back their plans for deploying vCPE, which may have had some effect on market size. In addition, logistical difficulties for vCPE deployments were caused by disruptions in the world's supply chain and limitations on physical mobility and installations. Physically entering the client's premises to install the required hardware or software for vCPE solutions was challenging due to the pandemic-induced limitations. These difficulties hampered rollout schedules and somewhat hindered market expansion.Key Benefits For Stakeholders
- This report provides a quantitative analysis of the market segments, current trends, estimations, and dynamics of the virtual customer premises equipment market analysis from 2022 to 2032 to identify the prevailing virtual customer premises equipment market opportunities.
- The market research is offered along with information related to key drivers, restraints, and opportunities.
- Porter's five forces analysis highlights the potency of buyers and suppliers to enable stakeholders make profit-oriented business decisions and strengthen their supplier-buyer network.
- In-depth analysis of the virtual customer premises equipment market segmentation assists to determine the prevailing market opportunities.
- Major countries in each region are mapped according to their revenue contribution to the global market.
- Market player positioning facilitates benchmarking and provides a clear understanding of the present position of the market players.
- The report includes the analysis of the regional as well as global virtual customer premises equipment market trends, key players, market segments, application areas, and market growth strategies.
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Key Market Segments
By Deployment Mode
- On-premise
- Cloud
By Enterprise Size
- Large Enterprise
- Small and Medium-sized Enterprise
By End User
- Data Centers and Telecom Service Providers
- Enterprises
- Enterprises
- BFSI
- IT
- Government and Public Sector
- Manufacturing
- Healthcare
- Others
By Component
- Solution
- Services
By Region
- North America
- U.S.
- Canada
- Europe
- UK
- Germany
- France
- Italy
- Spain
- Rest of Europe
- Asia-Pacific
- China
- Japan
- India
- Australia
- South Korea
- Rest of Asia-Pacific
- LAMEA
- Latin America
- Middle East
- Africa
Key Market Players
- Arista Networks, Inc.
- Broadcom Inc.
- Cisco Systems Inc.
- Dell Inc.
- Hewlett Packard Enterprise Development LP
- Huawei Technologies Co., Ltd.
- Intel Corporation
- International Business Machines Corporation
- Juniper Networks, Inc.
- NEC Corporation
Table of Contents
CHAPTER 1: INTRODUCTION
CHAPTER 2: EXECUTIVE SUMMARY
CHAPTER 3: MARKET OVERVIEW
CHAPTER 4: VIRTUAL CUSTOMER PREMISES EQUIPMENT MARKET, BY COMPONENT
CHAPTER 5: VIRTUAL CUSTOMER PREMISES EQUIPMENT MARKET, BY DEPLOYMENT MODE
CHAPTER 6: VIRTUAL CUSTOMER PREMISES EQUIPMENT MARKET, BY ENTERPRISE SIZE
CHAPTER 7: VIRTUAL CUSTOMER PREMISES EQUIPMENT MARKET, BY END USER
CHAPTER 8: VIRTUAL CUSTOMER PREMISES EQUIPMENT MARKET, BY REGION
CHAPTER 9: COMPETITIVE LANDSCAPE
CHAPTER 10: COMPANY PROFILES
List of Tables
List of Figures
Executive Summary
According to this report, the virtual customer premises equipment market was valued at $3 billion in 2022, and is estimated to reach $92.9 billion by 2032, growing at a CAGR of 41.4% from 2023 to 2032.Virtual customer premises (vCPE) converts operations that were formerly hardware-based into virtual functions that run on software. In lockstep with the ongoing decline in the price per bit, revenue declines. To increase their revenue streams, market competitiveness, and customer loyalty, providers now strive to offer services beyond connectivity. These services include WAN optimization, software-defined WAN, Session Initiation Protocol (SIP) trunking, managed IP-VPNs for remote workers & branch offices, managed security for entire companies, and even bundled Office 365 subscriptions. vCPE converts formerly hardware-based operations into virtual functions that run on software. The biggest opportunity for operators to set their services apart from those of their rivals is to offer these kinds of services.
On the basis of deployment, on-premise segment dominated the virtual customer premise equipment market in 2022 and is expected to maintain its dominance in the upcoming years owing to offer reduced latency and quicker response times for some use cases, such as real-time apps or data-intensive activities propels the market growth significantly. However, the cloud segment is expected to witness highest growth, owing to offers regular and dependable access across their whole network architecture, this is especially advantageous for companies with spread or remote sites driving the market growth in this sector.
By region, North America dominated the market share in 2022 for the virtual customer premises market, owing to North America is home to numerous large enterprises and multinational corporations that encourages technological advancements, regulatory changes, and emerging competition, which is expected to drive market revenue growth in the region. Thus, anticipated to propel the growth of the market. However, Asia-Pacific is expected to exhibit the highest growth during the forecast period. These countries have been investing heavily in telecommunications infrastructure and cloud-based services, driving the demand for virtualized networking solutions, which is expected to drive market revenue growth in the region and provide lucrative growth opportunities for the market in this region.
The pandemic has hastened the implementation of initiatives for remote work and digital transformation. In order to support remote workers and facilitate effective operations, organizations have realized the need of flexible and adaptable networking solutions. Because it is software-based and virtualized, vCPE provides the scalability and agility needed for remote work environments. The market for vCPE is presented with a sizable opportunity as a result of the rising emphasis on remote work and digital transformation. In an effort to improve agility and streamline operations, businesses have expedited their adoption of cloud services as a result of the pandemic. With their capacity to interface with cloud platforms, vCPE solutions fit in well with this development. In order to manage and deploy network services effectively, organizations are looking for virtualized networking solutions that connect to cloud environments without any issues. This gives vCPE suppliers the chance to develop integrated solutions and stimulate market growth. There are now worries about security and data privacy as a result of the shift to remote employment. Businesses are searching for dependable and safe connectivity options that safeguard sensitive information and guarantee compliance with data protection laws. vCPE suppliers have the chance to allay these worries and expand their customer base if they provide strong security features like encryption, authentication, and intrusion detection systems. Cost reduction and scalability will continue to be top priority for organizations as they recover from the pandemic's economic effects. The long-term cost benefits provided by vCPE solutions come from lower hardware costs and easier network management. vCPE solutions will appeal to businesses wishing to scale their networking infrastructure and save expenses, opening up new market opportunities.
Key Findings of the Study
By component, the solution segment accounted for the largest virtual customer premises market share in 2022.By deployment mode, the on-premise segment accounted for the largest virtual customer premises market share in 2022.
By enterprise size, the large enterprise segment accounted for the largest virtual customer premises market share in 2022.
By end user, the data centers and telecom service providers segment accounted for the largest virtual customer premises market share in 2022.
By enterprises, the BFSI segment accounted for the largest virtual customer premises market share in 2022.
Region wise, North America generated the highest revenue in 2022.
The market players operating in the virtual customer premises market are International Business Machines Corporation, Arista Networks, Inc., Broadcom Inc., Cisco Systems Inc., Hewlett Packard Enterprise Development Lp, Juniper Networks, Inc., Dell Inc., NEC Corporation, Intel Corporation, Huawei Technologies Co., Ltd. These major players have adopted various key development strategies such as business expansion, new product launches, and partnerships, which help to drive the growth of the virtual customer premises market globally.
Companies Mentioned
- Arista Networks, Inc.
- Broadcom Inc.
- Cisco Systems Inc.
- Dell Inc.
- Hewlett Packard Enterprise Development LP
- Huawei Technologies Co., Ltd.
- Intel Corporation
- International Business Machines Corporation
- Juniper Networks, Inc.
- NEC Corporation
Methodology
The analyst offers exhaustive research and analysis based on a wide variety of factual inputs, which largely include interviews with industry participants, reliable statistics, and regional intelligence. The in-house industry experts play an instrumental role in designing analytic tools and models, tailored to the requirements of a particular industry segment. The primary research efforts include reaching out participants through mail, tele-conversations, referrals, professional networks, and face-to-face interactions.
They are also in professional corporate relations with various companies that allow them greater flexibility for reaching out to industry participants and commentators for interviews and discussions.
They also refer to a broad array of industry sources for their secondary research, which typically include; however, not limited to:
- Company SEC filings, annual reports, company websites, broker & financial reports, and investor presentations for competitive scenario and shape of the industry
- Scientific and technical writings for product information and related preemptions
- Regional government and statistical databases for macro analysis
- Authentic news articles and other related releases for market evaluation
- Internal and external proprietary databases, key market indicators, and relevant press releases for market estimates and forecast
Furthermore, the accuracy of the data will be analyzed and validated by conducting additional primaries with various industry experts and KOLs. They also provide robust post-sales support to clients.
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