Network Function Virtualization (NFV) Market

Network Function Virtualization (NFV) Market Outlook (2025 to 2035)

The global Network Function Virtualization (NFV) market is expected to reach USD 9,994 million by 2035, up from USD 4,701 million in 2024. During the forecast period from 2025 to 2035, the industry is projected to expand at a CAGR of 7.1%. The accelerating adoption of cloud-native network infrastructure is a pivotal driver for the industry.

Enterprises and telecom operators increasingly favor virtualized network services to reduce CAPEX and OPEX while achieving agile service provisioning. This trend aligns with 5G rollouts and edge computing demands, positioning NFV as essential for next-generation network scalability and innovation.

Metric	Value
Industry Size (2025E)	USD 5,033 Million
Industry Value (2035F)	USD 9,994 Million
CAGR (2025 to 2035)	7.1%

NFV decouples network functions from hardware appliances, allowing them to run on ordinary commercial servers. This approach enables telecom operators and enterprises to adjust, expand, and reduce costs more easily. Thanks to NFV, services are deployed very fast, the network design becomes simpler and introducing new services can happen quickly, without needing to modify the actual infrastructure. As networks transition to cloud-native and software-defined approaches, NFV now plays a crucial role in modern networking strategies.

More companies are moving to NFV, which will significantly influence the telecom, enterprise and cloud markets. When operators switch to 5G, edge computing and software-defined networks, along with NFV, will be crucial for making the infrastructure easy to adjust and expand. With companies, requiring cheaper operations, faster deployments, and better networks a steady growth in the demand for NFV is expected. As AI, machine learning, and open standards continue to evolve, NFV will grow and play a key role in digital transformation.

What impact does Network Function Virtualization have on reducing telecom infrastructure costs and improving scalability?

Fostering agility in networks and operating more efficiently are the main reasons behind the use of NFV. With digital transformation growing rapidly, organizations now require network solutions that can be easily adapted to meet evolving business demands. More apps that process data, Internet of Things gadgets and workers who use networks remotely require network infrastructure to be easily expandable. Thanks to NFV, it is possible to deliver services more quickly and scale them almost instantly without depending on hardware.

Additionally, it reduces both capital and operational expense categories, making the adoption more financially appealing. Telecom companies, in particular, have made significant progress by using NFV to virtualize their core and accelerate the pace of offering new services. The rise in regulatory approval for open network standards accelerates the growth of Network Functions Virtualization (NFV).

What are the key trends currently shaping the Network Function Virtualization (NFV) market landscape globally?

Convergence with cloud-related technologies is one of the biggest trends in NFV. People are now using containerization and microservices as alternatives to virtual machines, since they make network functions more portable. The presence of AI and automation makes it easier to detect problems and prevent them in NFV orchestration.

NFV is being increasingly used at the edge of networks to support low-latency applications, such as augmented reality and self-driving vehicles. There is also an increase in interoperability and openness, as industries request standardized ways of communicating and the use of open-source software.

What factors are currently limiting the growth of the Network Function Virtualization (NFV) market?

While the market for NFV has good benefits, it continues to encounter some problems that could hold back its progress. Virtualized functions are complicated to handle and integrate between multiple vendors’ equipment. When things are not standard, it can lead to companies being tied to one solution and waiting longer for their system to be set up.

Security remains a major concern, as virtualization introduces new types of security risks that must be mitigated with advanced tools. For NFV to be used well, companies should hire skilled employees and make organizational adjustments, which isn’t easy for everyone to do. Forwarding investment in the infrastructure and management platforms for NFV can be difficult for small and medium-sized organizations.

Why are dual-polarized antennas the firmly growing segment in the NFV polarization-based market today?

The dual-polarized antenna segment is experiencing the dominant growth in the polarization-based antenna market and is expected to maintain its dominance over the coming years. The growing demand for high-capacity, high-efficiency communication systems in modern network architectures primarily drives this rapid expansion.

Dual-polarized antennas are designed to transmit and receive electromagnetic waves on both vertical and horizontal polarization planes simultaneously, thereby doubling the data transmission capacity without requiring additional frequency spectrum. This significantly enhances spectral efficiency, signal clarity, and overall network performance.

Such features make dual-polarized antennas ideally suited for data-intensive applications like 4G LTE, 5G networks, and Wi-Fi MIMO (Multiple Input Multiple Output) systems. These antennas also support advanced technologies such as beamforming and Massive MIMO, which are crucial for achieving the high throughput and low latency targets of next-generation wireless communication.

As urban networks become denser and edge computing grows, the importance of robust, space-saving, and interference-resistant antenna solutions becomes critical, further favoring dual-polarized designs.

Which regions are driving the strong growth in the Network Function Virtualization (NFV) market currently?

North America is in the lead due to the increased consumer mobile broadband and early efforts to build smart cities. Because of ongoing modernization efforts by the USA, its government and private organizations, the country alone drives significant growth in the network infrastructure market.

The rapid deployment of 5G in China, South Korea, and Japan is helping East Asia develop into a fast-growing region. They are turning to smart manufacturing, networked cars and the Internet of Things in factories, all of which are made possible by the dependable high-speed and short delays offered by dual-polarized antennas. Significant investments in polarization diversity are evident in China’s use of large MIMO-antenna arrays, which also employ beamforming technologies.

Focusing on being eco-friendly and using up-to-date antennas, Western Europe continues to expand in renewable energy, railways and IoT networks. Germany and the UK are pushing for 5G and V2X, which is increasing the use of high-performance antennas in both urban and suburban areas.

Country-Wise Outlook

AI Adoption and Agile Demands Accelerate USA Model-Based Testing Market Growth

The rapid expansion of NFV in the United States is driven by new digital trends, advancements in healthcare infrastructure, and the increased adoption of agile development methods. Many organizations in controlled spheres, and especially those in healthcare and finance, rely on model-based testing because they must follow a fast update cycle and meet particular rules. Since embedded systems are widely used in automobiles and other equipment, the demand for them is increasing.

American firms depend on MBT to simulate beginner positions, handle testing work easily and reduce the time it takes for new products to come out. Problems with integrating tools into CI/CD processes and the growth of AI programs for software are signs of the industry’s development. The leadership of MBT is maintained by having skilled employees, developing new technologies and encouraging teamwork from America.

Industry 4.0 and 5G-Driven Innovation Propel Germany’s NFV Market Expansion

The market for NFV is consistently growing in Germany due to its manufacturing strength and the government's efforts to support Industry 4.0. Because 5G, IoT and connected vehicles demand scalable network infrastructure, the telecommunications and automotive sectors are making extensive use of it. Leading German businesses are investing more effort in virtual network functions that meet security and privacy standards.

Using open-source and standards-based frameworks encourages the use of NFV in companies and the telecom industry. In Berlin and Munich, several hubs are utilizing NFV for autonomous and smart city solutions, combining the power of AI-based orchestration with real-time network changes.

Smart Manufacturing and Autonomous Mobility Fuel China’s MBT Adoption Surge

Due to China’s industrial digitalization, smart manufacturing activities and ‘Made in China 2025’ initiative, Network Function Virtualization (NFV) is growing quickly in the country. Many companies operating in the electric vehicle, telecommunications, and public infrastructure sectors are utilizing MBT techniques to test more, increase safety, and simplify their testing systems.

Because China is making progress with autonomous driving, it is necessary to use well-designed test environments based on the MBT framework. Since the importance of software quality is clear in crucial applications and there are more local MBT services, more companies are adopting this method. On top of its main purpose, using AI and cloud-based testing tools supports China’s objective of developing easy-to-use and automated quality systems.

Country-Wise Insights

Countries	CAGR (2025 to 2035)
United States	5.6%
Germany	3.9%
China	7.7%

Category-Wise Market Outlook

Flat Panel Antennas Propel Beamforming in Next-Gen Mobile and Aerospace Networks

Flat-panel antennas are a rapidly growing type of antenna. The main reasons are their low profile and ease of integration, along with high performance for beamforming applications, the perfect fit for 5G, satellite communications, and high-speed mobile networks. They are becoming widely used in next-generation vehicular and aerospace communication systems.

The promotion of flat panel technologies is enhanced by the shift in focus to electronically steerable antennas (ESAs) for broadband and mobility applications. Their being mountable on moving vehicles, such as aircraft and trains, heightens their interest to dynamic, high-data-rate applications.

Dual-Polarized Antennas Amplify MIMO Efficiency in Urban 5G Networks

Being able to transmit and receive signals in vertical and horizontal polarizations, dual-polarized antennas are now experiencing rapid growth. This would imply better spectrum utilization and enhanced performance, including improved data throughput and signal clarity. With the increasing penetration of MIMO configurations into modern communication systems, the dual-polarized antenna is now emerging as a truly indispensable entity. Their increasing adoption in LTE and 5G base stations, especially in densely populated urban regions, paves the way for their accelerated growth in the market.

Intermediate-Size Antennas Power Versatile Satellite Connectivity in Remote Networks

The firmly growing sub segment of this product is the so-called intermediate-size antennas, those with diameters ranging from 1 to 3 m. This size range represents the sweet spot for receivers in terms of gain and flexibility given current technological or mechanical designs, making them amenable to mid-range satellite communications, broadcasting, and emergency response systems.

It is this size that is considered sufficiently large to achieve the needed gain, yet sufficiently small to be installed on vehicles and mobile stations or as pop-up rooftops. The increasing demand for MSS and VSAT networks in remote areas further strengthens growth in this sector.

mmWave Spectrum Fuels Growth in 5G and Defense Communications

Due to increasing interest in millimeter-wave 5G, point-to-point communication, and advanced radar systems, the 30.0 GHz-86.0 GHz region is witnessing the most rapid growth. These frequency bands provide extreme bandwidth for backhaul networks and autonomous vehicle communication, which require extremely high data rates for transmission. The deployment of mmWave in urban 5G infrastructure, coupled with its usage in military radar and surveillance landscape, is creating demand for this spectrum region.

Flat-Panel Antennas Empower 5G Expansion in High-Density Telecom Networks

Telecom is the swifly rising sector within the application space, with 5G being rolled worldwide and the other name of need being Ultra-Reliable Low-Latency Communications. With the installation of small cells, massive MIMO, and fiber-to-the-antenna architectures across their metro areas, the demand for higher-grade antenna systems is getting intense.

Such operators are employing flat-panel antennas and dual-polarized antennas to fulfill the demands of dense networks of the rapid speed currently. In moving toward SDN and embracing NFV, existing antenna systems are very much at the heart, still serving the objective of improving spectrum efficiency and coverage.

Competitive Analysis

Competitive Outlook: Network Function Virtualization (NFV) Market

The demand for cloud-native network architectures, software-defined infrastructure, and 5G rollouts is reshaping the Network Functions Virtualization (NFV) market. To enable intelligent orchestration, anomaly detection, and performance optimization, companies are building AI and ML capabilities into NFV platforms.

Strategic partnerships between hardware vendors and software providers are on the rise as companies try to cut down capital expenses and promote service agility. Whereas tech giants dominate the orchestration and software-based layers, infrastructure and hardware-based solution providers have had their say in actualizing edge and core network deployments.

The NFV ecosystem comprises a mix of traditional telecom equipment manufacturers, RF/microwave component suppliers, and emerging innovators with niche solutions relevant to base station virtualization, small-cell deployment, and energy-efficient network components.

Key market players in the network function virtualization industry include Commscope, Ericsson, Comba Telecom Systems Holdings, Amphenol, Cambium Networks, Tongyu Communication, Laird, Wireless Excellence, Powerwave Technologies, and Rosenberger.

Recent Development

• In May 2025, Ericsson announced enhancements to its NFV Infrastructure (NFVI), enabling Communication Service Providers to deploy virtual network functions (VNFs) and cloud-native functions (CNFs) more efficiently across their networks, supporting diverse applications including IoT and IT services.
• In February 2024, DZS introduced the DZS Saber 4400 ROADM optical transport module and the DZS Xtreme orchestration and automation software platform. Recognized with high scores in the 2024 Lightwave Innovation Review, these products enhance network flexibility and automation, supporting advanced NFV deployments.

Fact.MR has provided detailed information about the price points of key manufacturers of Network Function Virtualization (NFV) Market positioned across regions, sales growth, production capacity, and speculative technological expansion, in the recently published report.

Methodology and Industry Tracking Approach

The 2025 global network function virtualization (NFV) market report by Fact.MR includes insights from 13,000 stakeholders across 36 countries, with a minimum of 330 respondents per market. Sixty-seven percent were end users or producers, and 33% were industry professionals, including engineers, consultants, and cloud specialists.

Conducted between June 2024 and May 2025, the network function virtualization market study captured demand trends, investment flows, innovation gaps, risks, and growth opportunities. Data was weighted to reflect regional and demographic accuracy. Over 290 verified sources, including patents, academic literature, financials, and regulatory filings, were analyzed.

Statistical tools such as regression analysis ensured robust forecasting. With ongoing research initiated in 2018, Fact.MR has examined virtualization trends, telco cloud adoption, infrastructure agility, and ecosystem interoperability, making this NFV industry report a vital asset for strategic planning and decision-making.

Segmentation of Network Function Virtualization (NFV) Market Research

• By Type :

  • Parabolic Antenna
  • Flat Panel Antenna
  • Yagi Antenna

• By Polarization :

  • Single-polarized Antenna
  • Dual-polarized Antenna

• By Diameter :

  • 0.2m to 0.9m
  • 1.0m to 3.0m
  • 3.1m to 4.6m

• By Frequency Range :

  • 1.0 GHz to 9.9 GHz
  • 10.0 GHz to 29.9 GHz
  • 30.0 GHz to 86.0 GHz

• By Application :

  • Telecommunication
  • Commercial or Industrial
  • Military and Defense
  • Satellite
  • Others

• By Region :

  • North America
  • Latin America
  • Western Europe
  • Eastern Europe
  • East Asia
  • South Asia & Pacific
  • Middle East & Africa