Japanese operators’ spending on wireless network equipment is expected to decline sharply over the next five years after dropping slightly in 2016, according to a report from IHS Markit.

The country’s mobile infrastructure market declined 2 per cent year-on-year in 2016 to $3.3 billion and is forecast to fall 15.3 per cent annually to $1.5 billion in 2021 (see chart below, click to enlarge).

The decrease was a result of the long shift from network build-outs between 2010 and 2013 to LTE network enhancements, said Stephane Teral, senior research director and adviser at IHS Markit.

He said 3.5GHz TDD-LTE enhancements are creating a shift from FDD to TDD LTE spending.

Nokia maintained the lead for radio access network (RAN) equipment in Japan in 2016.

Overall, 3G equipment sales increased 34 per cent and LTE revenue decreased 5 per cent year-on-year in 2016.

Preparations for 5G are pressing vendors to meet NTT Docomo’s goal of showcasing the technology at the 2020 Olympic Games and have a nationwide commercial launch in 2023. Teral noted these pushes should kick off a new investment cycle in 2019 by injecting a few billion dollars into the mobile infrastructure market.