The coronavirus (COVID-19) outbreak is causing widespread concern and economic hardship for consumers, businesses, and communities across the globe. Situation is changing quickly with widespread impacts. Ongoing spread of the COVID-19 has become one of the major threats to the global economy and is causing widespread concern and economic hardship for consumers, businesses, and communities across the globe.
The “new normal” that includes social distance and working from home has created challenges with daily activities, regular work, needs, and supplies causing delayed initiatives and missed opportunities. COVID-19 has caused the overall semiconductor industry to mobilize quickly and to make short-term decisions with long-term implications. Increase in penetration of wireless technology in various industries is expected to register gradual increase, owing to various contributing factors such as availability of novel products and rise in awareness toward automation.
The emergence of COVID-19 pandemic has caused an irrevocable loss across the world, in terms of mankind as well as economic. It has severely affected different sectors, including agriculture, healthcare, education, infrastructure, and tourism. The consumer electronics sector witnessed a marginal dip in 2020, owing to the global health crisis, as there was restriction on movement and lockdown across various countries. It resulted in shortage of equipment and disruptions of the supply chain. These restrictions forced the market players to explore new opportunities by leveraging technologies.
Millimeter wave is an electromagnetic technology used in various products such as phones, cars, and medical devices to ensure wireless broadband communications at a higher speed. It exhibits extremely high frequency (EHF), as its signal spectrum ranges from 30GHz to 300GHz with a wavelength between 1 and 10 mm. Rise in demand for connected devices such as smartphones and tablets is driving the market growth for millimeter wave technology. The millimeter wave technology offers various advantages over fiber optics such as high bandwidth, high speed, and more secured transmission.
This millimeter wave technology is experiencing significant adoption across various industrial and commercial sectors such as providing wireless communication in smart wearable, smartphones, and smartwatches. Technological advances in digital networks connect number of devices and sensors together, which ensure advances in healthcare, education, transportation, automotive, telecommunication, and other industries. Hospitals are now using autonomous millimeter wave technology for medical imaging. Military and aerospace use millimeter wave technology in segments such as radar and satellite communications, which are majorly deployed by the military in combat scenarios. The telecommunication industry uses millimeter wave technology for transmitting the data over long distances.
Impact of COVID-19 on several industries in context with millimeter wave technology
The COVID-19 crisis is resulting in uncertainty in the stock market, immense slow ranging of the supply chain, falling business confidence, and increasing panic among the customer segments. The overall impact of the pandemic is impacting the production process of several industries, including semiconductor and electronics. Trade barriers are further constraining the demand and supply outlook. As the government of different countries has already announced total lockdown and temporarily shutdown of industries, the overall production process is adversely affected.
Increase in focus toward the development of smart cities is expected to offer lucrative opportunities for market expansion, which further propels the demand for unmanned vehicles in the transportation and automotive sectors. This is expected to create potential opportunities for the millimeter wave technology market growth, owing to shift in preference of consumers from normal cars to smart driver’s assistant cars, which help in GPS navigation, blind spot detection, and prevents collision.
Telecommunications is a people-driven industry, with a dynamic and mobile workforce, including teams in offices, in the field, onsite, on trucks, and in retail stores. Working from home is expected to reduce productivity and impact business continuity. In addition, remote work can increase security and infrastructure risks.
In the telecommunication industry, the trend in the U.S., Europe, China, South Korea, and Japan is focusing toward a regional supply chain model that would increase visibility and potentially reduce the risk of supply interruptions from countries that are expected to face a second wave of infection. Another priority is to add more intelligence to the supply chain to ensure continuity of supply in a time of heightened uncertainty.
COVID-19 has exposed telecom industry’s supply chain vulnerabilities as many organizations depend on China as a global manufacturing hub for the telecom industry and have witnessed disruption of global supply chains. Though factories and businesses in China and other countries have slowly resuming operations, there is an impact on the telecom industry with the outbreak of the COVID-19. As an example, Apple experienced lack of its iPhone supply as a result of its primary manufacturers Foxconn shutting down its production in China.
- Global COVID-19 milimeter wave technology market, 2020 ($MILLION)
Source: Primary & Secondary Research and AMR Analysis
Key player strategies to tackle negative impact
The economic impact of coronavirus pandemic globally has been largely disruptive. The companies operating in semiconductor industry state that temporarily shut down of production sites will lead to decline in revenues for the financial year 2020–2021. The various measures undertaken by players to tackle the negative impact are as follow ranges:
Limiting cuts to R&D expense
Major players operating in the millimeter wave technology market are expected to make moderate R&D cuts, which will allow them to sustain a rich and evolving product portfolio. In addition, companies will strive to fund innovation, rather than setting the bare minimum budget needed to keep R&D running.
Focusing on next-generation products
It is expected that demand for new and innovative products would surge once the economy begins to recover. Rather than simply improving products using current state-of-the-art technology, companies are looking forward to invest in next-generation products using new technologies, as it will well position its goodwill, once customer demand surges.
Shift toward agile supply chain model
The key players in the millimeter wave technology market are shifting toward agile supply chain network model that has multiple pathways to prevent single points of failure. It can help them to balance costs with better assurance for business continuity and sustainability. Shifting from single country hubs to more extensive regional supply networks will initiate collaborative partnerships and industry associations.
Stakeholders will be investing in resources and infrastructure that can quickly enable new manufacturing and supply nodes when required.
Post COVID-19 scenario
The demand from the wireless communication segment is expected to increase due to factors such as increased broadband usage, higher demand for cloud services, and video streaming. In addition, in the medium to long term, COVID-19 is expected to further augment the need for digital transformation; technologies such as 5G, the IoT, and AI; and intelligent edge computing for future optimizations.
The COVID-19 crisis has created a window of opportunity for industry leaders to aggressively address the overall telecommunication industry.
Bandwidth usage per consumer has nearly tripled since the launch of 5G technologies and infrastructure, due to surge in demand of video streaming.
The millimeter wave technology is being increasingly used in fifth generation cellular, wireless local area networks, and wireless personal area networks. The application of millimeter wave technology in consumer & commercial application is rising increasingly due to its features such as higher frequency bandwidth, seamless connectivity, and operational efficiency. Millimeter wave technology-based image & body scanners and goods scanners are used for safety and security purposes. These RF-based mmWave scanners are being used in airports, public venues, malls & shopping complexes, and government buildings. Governments, security agencies, and businesses across the world are using this technology to solve security challenges, which is expected to provide lucrative opportunity to the market growth.
However, decline in productions by OEMs, reduction in demand for mobile phones & other consumer electronics, and restrictions toward adoption of 5G technology have negatively impacted the millimeter wave technology market. Shortages of critical components and materials have significantly impacted the global supply chains. In addition, reductions in various capital budgets and delay in various planned projects in various end-use industries have hampered the global economy.
Recent news in the millimeter wave technology market during the pandemic
Millimeter wave radio links are considered to be significant backhaul solution in the telecommunication infrastructure, majorly used for cellular wireless access. 5G technology uses millimeter waves with frequency bands more than 10 times higher than 4G, and is expected to contribute to a wide range of services that provide high-speed, large-capacity, low-latency, and multiple connections. For instance, on January 24, 2020, NEC Corporation, a leader in the integration of IT and network technologies, announced the development of millimeter wave distributed antennas for 5G millimeter-wave spectrum with 28GHz band. The product launch is expected to establish enhanced communication quality among users.
The 4G LTE technology currently uses lower frequency spectrum, generally below 1 gigahertz (GHz), to deliver data at great speed. However, this is expected to change in the future with the advent of 5G networking. The 5G network is expected to be based on higher frequencies such as the 28 GHz and 39 GHz, which is also known as millimeter wave spectrum. These frequencies can carry massive volume of data at very high speeds and with little latency or disturbance, thus making them suitable for use in applications such as mobile phones, connected homes, AR/VR devices, cloud gaming systems, self-driving vehicles, IoT sensors, and other cloud-connected devices.
Presently, automotive players are incorporating advance driver assistance system (ADAS) in their products to reduce car accidents. Automotive suppliers are jointly developing this system using millimeter wave radar technology. With higher resolution and range, automotive mmWave radar can enable safer driving in any condition. The frequency range of millimeter wave radar in automotive application ranges from 76 GHz to 81 GHz. For instance, Mitsubishi Electric Corporation developed millimeter wave radar for its automotive application with a frequency range of 76 GHz to 77GHz.
Major companies in North America have heavily invested in 5G infrastructure, which is fast moving operation. For instance, AT&T planned to use key 5G technologies using mmWave spectrum to serve the connectivity in dense urban environment. AT&T further declared that Ericsson is one of its technology suppliers in nationwide of 5G network. In this partnership, both the companies launched mobile 5G network in five countries, including Jacksonville, New Orleans, Houston, and San Antonio. The need for intelligent and smart devices and technology platforms by different industries has increased the use of advanced packaging solutions, which creates demand for millimeter wave technology.
Asia-Pacific is estimated to be the largest region in millimeter wave technology market in terms of revenue during the forecast period. This is attributed to the fact that the deployment of 5G network has increased rapidly in this region for faster access to data, voice, and other solutions and services. Rise in demand for high-speed network for accessing smart application on commercial and residential level further drives the growth of the market.
For instance, in December 2019, the Ministry of Industry and Information Technology established 5G millimeter wave spectrum in China. China developed 3D mmWave scanner for security purpose in airport application that offers higher accuracy and faster response with low manpower. This scanner can detect as many as 89 risky and dangerous objects within one second, which will also have 95?curacy rate.
The millimeter wave technology market is expected to leverage high potential for the telecommunication and military and aerospace & defense industry verticals in the coming years. The current business scenario is witnessing an increase in the demand for wireless communication and a high bandwidth application in electronic devices and wearable devices, particularly in the developing regions such as China and India due to an increase in demand for totally dependence on internet such as media exchange, video conferencing, streaming, and online gaming.
Companies in this industry are adopting various innovative techniques such as mergers and acquisition activities to strengthen their business position in the competitive matrix. R&D activities and the adoption of the technology across various equipment and applications in developed countries such as the U.S., the UK, Germany, and China make the countries hold the major market shares, globally.