Satya Manikanta, Consulting Analyst
Arushi Thakur Upadhyay, Associate Director, Automation & Electronics Practice, Frost & Sullivan
India offers big opportunities for the test and measurement (T&M) equipment market. This is primarily attributed to the growth of the electronic industry in India along with government initiatives such as Make in India, the Smart Cities Mission, Digital India, as well as technology advancements. The current size of the general-purpose T&M equipment market is estimated at $220 million for financial year 2018. New developments such as internet of things (IoT), millimetre-wave frequencies and 5G propose significant changes in the requirements for test equipment, thus opening up new opportunities for T&M vendors.
Digital India initiative drives telecom growth
India is currently the world’s second largest telecommunications market with a subscriber base of 1.2 billion. The mobile industry is expected to create a total economic value of $217 billion by 2020. India’s internet economy is expected to touch $155 billion by 2018, while the rise in mobile phone penetration and decline in data costs will add about 500 million new internet users in India over the next five years. In the first quarter of 2018, India became the world’s fastest growing market for mobile applications.
The government launched the Digital India initiative, aiming to provide digital infrastructure as a core utility to every citizen. BharatNet was launched to deploy high speed optical fibre cable for connecting 0.26 million gram panchayats across the country by 2018. The Department of Telecommunications has targeted to set up 500,000 Wi-Fi hotspots from the current 38,000 by end 2018. As a result of these developments, optical multiport power meters, network analysers, radio frequency (RF) and wireless local area network (WLAN) test solutions aided with software products will see more demand in the near future. Wireless services such as high speed internet connections (3G/4G) will continue to drive operator revenues as more subscribers use smartphones and access internet-based video content. The year 2018 is set to be another pivotal year for over-the-top (OTT) service growth, fuelled by increased video streaming and public demand for non-linear media consumption. However, a boost in OTT service adoption and consumption will increase the financial and infrastructural pressure on network operators. Demand for high speed cellular solutions like network, spectrum and signal analysers will see further growth. On the other hand, long term evolution (LTE)-Advanced specifications are focused mainly on achieving higher capacity with increased peak data rates and higher spectral efficiency. 4G LTE is the most advanced network in terms of speed, which can help download data at up to 12 Mbps, and allow smooth streaming of live videos and better response times for multiplayer online games. The technology is still being enhanced in order to meet ITU-Advanced requirements where T&M instruments like spectrum analysers become essential. Major telecom operators in India have also started piloting a new antenna technology called multiple input multiple output (MIMO) that uses multiple transmitters and receivers to transfer more data at the same time. All wireless products with 802.11n support MIMO and this technology will provide more than five times the capacity in a 30 MHz wide-band spectrum in high user density areas. T&M suppliers are coming up with advanced RF communication analysers, signal generators and analysers to meet the higher-order MIMO testing demand.
5G-ready India by 2022 
India plans to roll out state-of-the-art 5G telecom services by 2022. The new technology offers massive connectivity and low power consumption, and boasts of download speeds and capacity that can enable autonomous vehicles, drones, remotely assisted surgeries and traffic control. 5G connectivity will be used in emerging technologies like developing IoT, smart cities and smart agriculture. 5G, due to its greater speed capabilities, will also enable next-generation IoT and machine-to-machine applications, which include autonomous vehicles and virtual or augmented reality. Though India will not have a significant share in the global 5G service revenues in 2019, it will contribute 24 per cent of the service revenue within the Asia-Pacific (APAC) region by 2022 backed by the extensive promotion of Digital India by the Indian government. India is under progression to build 100 smart cities by 2020 and it will become the second largest service revenue contributor for 5G in the APAC region after China. The government is also focusing on the implementation of autonomous vehicles by 2025, providing a positive platform for 5G growth. Major handset manufacturers are working on the adoption of 5G connectivity on smartphones and are expected to launch 5G-ready smartphones by 2020. Signal generators and oscilloscopes will continue to help the latest technologies in design, simulation and compliance testing.
Key trends in telecom T&M
The telecommunication industry is booming and communication service providers are working aggressively to either build new networks or enhance the existing ones to support new technologies and to meet the growing end-user demands. The rapid change in network circulation from voice to integrated voice, video and data is encouraging the need for solutions to test performance, capacity and network management for data traffic.
Testing for smart devices
The proliferation of smart devices has begun to influence the design and use of T&M equipment. Each “smart” product has to go through a specific set of processes to ensure its usability and functionality. For both testing managers and engineers, the challenge is to ensure quality at increasingly lower costs. To test their smart devices, organisations are transitioning from the status quo of rack-and-stack box instruments and closed turnkey automatic test equipment systems to smarter test systems that deliver connectivity and problem-solving capabilities.
Software-defined testing
The T&M industry, which has traditionally relied on hardware-centric benchtop instruments, is now more inclined towards a software-defined approach in order to create flexible and efficient test sets for 5G systems that comprise highly complex RF designs. Software modules allow engineers to quickly develop test programs for multiple 5G technologies and standards. These test sets, which can quickly adopt new 5G specifications through software, are also able to accelerate 5G prototyping and deployment. A software-based solution can adapt to the previously released radio heads for 71-76 GHz to 28 GHz by merely changing the RF radio heads.
Capex to opex model gains momentum
In the telecom sector, although huge investments have been made in procuring spectrum, mobile network operators are not willing to invest in T&M equipment. They have adopted the rental model, which reduces their cost for high-end instruments. Many rental companies like Livingston and TRS RenTelco are targeting multi nationals and telecom companies to attract them to these services. Thus, telecom companies are slowly moving towards a rental model to save on capex.
Network function virtualisation
Virtualisation enables companies to break free from rigid hardware solutions, which are typically expensive and a scarce resource. Virtual testing solutions will create demand for lab-as-a-service solutions, where operators and network equipment manufacturers can license testing solutions on a subscription basis, rather than paying for physical equipment. It will also enable them to more frequently test their networks against cybersecurity threats, preventing potential damage to their businesses. We can expect some of the top operators in India to move away from fixed lab environments and take advantage of emerging lab-as-a-service solutions as they look to reduce costs and centrally manage their resources.
Road ahead
Wireless equipment and network testing will continue to dominate the T&M space with LTE, voice over LTE, quality of service, scalability and smart devices being the key growth drivers. Higher frequencies and wider modulation bandwidth, coupled with the advent of newer technologies such as 5G, are expected to create growth opportunities for advanced T&M equipment. The government is planning to set up labs and testing centres, which will go a long way in addressing the problems faced by operators while simultaneously opening up new opportunities for T&M players in the country. To keep pace with end-user markets, T&M vendors have to shift to software-upgradable instruments, and offer predictive analytics, big data analytics and virtualised testing. Eventually, it will be imperative for T&M players to adopt new business models such as software-as-a-service and there will also be a need for better integration between simulation tools and T&M instruments
