Virtualized Evolved Packet Core Market Expands with Telecom Digitalization

Theglobal virtualized evolved packet core (vEPC) marketis witnessing rapid expansion, driven by the accelerating adoption of 5G networks, growing demand for efficient data traffic management, and the increasing shift toward cloud-based network infrastructure. According toKings Research, the market was valued atUSD 8.47 billion in 2024and is projected to grow fromUSD 10.28 billion in 2025toUSD 40.73 billion by 2032, exhibiting aCAGR of 21.64%during the forecast period.

Avirtualized evolved packet corerepresents a significant evolution in mobile network architecture, enabling operators to separate network functions from dedicated hardware throughnetwork function virtualization (NFV). This transformation enhances flexibility, scalability, and cost efficiency while supporting the massive connectivity demands of next-generation applications such as IoT, augmented reality (AR), virtual reality (VR), and autonomous vehicles.

As 5G adoption accelerates globally, vEPC has emerged as a foundational technology to ensurehigh-performance data transmission,low latency, andnetwork agility. The ongoing transition toward cloud-native and software-defined architectures is expected to further fuel market growth in the coming years.

Get Full Detailed PDF Report: https://www.kingsresearch.com/report/virtualized-evolved-packet-core-market-2792

Market Dynamics

Key Growth Drivers

1. Rising Adoption of 5G Networks

The commercialization of5Gis one of the primary drivers of the vEPC market. Unlike 4G, which relied on hardware-centric EPC, 5G requiresflexible, virtualized, and software-defined core networksto handle diverse services and ultra-low latency applications.
vEPC provides the necessary agility fornetwork slicing,dynamic resource allocation, andscalable traffic management, enabling operators to deliver customized services for different industries.

2. Surge in Mobile Data Traffic

The explosive growth inmobile internet usage, driven by video streaming, online gaming, and connected devices, has created enormous demand for efficient data routing and handling.
According to GSMA, global mobile data traffic is expected to exceed300 exabytes per month by 2030, creating substantial opportunities for vEPC vendors offering optimized data management and bandwidth utilization solutions.

3. Shift Toward Cloud-based Infrastructure

Telecom operators and enterprises are increasingly embracingcloud-nativeandvirtualized network architecturesto reduce operational costs and enhance scalability.
vEPC allows network functions such asMME, SGW, PGW, PCRF, andHSSto be deployed on commodity hardware and managed through virtualization, eliminating dependence on proprietary equipment.
This shift also enablesrapid deployment,on-demand scaling, andcentralized control, which are essential for managing complex, distributed 5G networks.

4. Growing Internet of Things (IoT) Ecosystem

The rising number of IoT-connected devices, spanning industries such asautomotive, healthcare, manufacturing, and smart cities, is propelling the need for flexible core networks.
vEPC provides the infrastructure to supportmassive machine-type communications (mMTC)andultra-reliable low-latency communications (URLLC)key requirements for IoT-based ecosystems.

Market Challenges

1. High Initial Investment and Integration Complexity

Although vEPC offers long-term cost benefits, initial deployment costs remain high due tohardware upgrades,network redesigns, andtraining requirements.
Integration of virtualized systems with existing legacy networks can be complex, requiring significant expertise and coordination between vendors, operators, and cloud service providers.

2. Security and Data Privacy Concerns

As vEPC operates in virtualized and cloud environments, it is more susceptible tocyber threats, data breaches, and unauthorized access.
Ensuring end-to-end encryption, implementing secure APIs, and adopting advanced identity management protocols are critical to maintaining network integrity and user trust.

3. Lack of Standardization

Interoperability challenges persist among different vendors and network architectures due to the lack of universal standards for virtualization in mobile cores.
This can lead to vendor lock-in and hinder seamless integration across multi-vendor ecosystems.

Market Segmentation

By Component

1. Solution

Thesolution segmentdominates the market, encompassing software suites that virtualize EPC functions such asSGW (Serving Gateway),PGW (Packet Data Network Gateway),MME (Mobility Management Entity), andPCRF (Policy and Charging Rules Function).
As operators move towardsoftware-based and containerized architectures, demand for vEPC software platforms that offer scalability, automation, and interoperability continues to grow.

2. Services

Theservices segmentincludesconsulting, integration, maintenance, and managed services.
Telecom operators often rely on managed service providers to handle complex deployments, software updates, and performance monitoring, enabling them to focus on customer experience and service innovation.

By Deployment

1. On-premises

On-premises deployment remains crucial for organizations requiringstrict data control, security, and low-latency performance.
Industries such asdefense, government, and manufacturingprefer on-premises vEPC to maintain full ownership and oversight of network operations.

2. Cloud-based

Thecloud-based segmentis expected to witness the fastest growth during the forecast period, driven by the flexibility and cost efficiency of cloud-native deployments.
Public and private cloud environments allow operators to dynamically scale resources, accelerate network upgrades, and reduce capital expenditure.
Cloud-native vEPC also facilitatescontainerized deploymentsusingmicroservices, improving fault tolerance and system reliability.

By Network

1. 4G

While the telecom industry shifts toward 5G, 4G networks continue to represent a significant share of mobile data traffic, especially in developing regions.
Operators are increasingly virtualizing their 4G EPC to improve efficiency and prepare for seamless migration to 5G architecture.

2. 5G

The5G segmentis projected to grow at the highest CAGR, driven by the expansion of standalone (SA) 5G networks.
vEPC (and its successor, the 5G Core) enables support forenhanced mobile broadband (eMBB),ultra-reliable communications, andmassive IoT, making it integral to the 5G ecosystem.

By Application

1. LTE, VoLTE, and VoWiFi

vEPC enables advanced voice and data services such asVoice over LTE (VoLTE)andVoice over WiFi (VoWiFi), ensuring high-quality connectivity and seamless user experience.

2. IoT and M2M Communication

Virtualized cores enable massive IoT deployment by handling millions of device connections efficiently while maintaining low latency and energy consumption.

3. High-bandwidth Applications

Applications such asvideo streaming,cloud gaming, andAR/VRdemand flexible, high-speed, and low-latency networks that vEPC supports through dynamic bandwidth management and traffic prioritization.

By End User

1. Telecom Operators

Telecom operators constitute the largest end-user segment, leveraging vEPC tomodernize networks,reduce OPEX, andlaunch innovative 5G services.
Operators such asAT&T, Verizon, Vodafone, andDeutsche Telekomare adopting vEPC to achieve service agility and enhance network performance.

2. Enterprises

Large enterprises in sectors likemanufacturing, energy, logistics, and smart citiesare deploying private networks powered by vEPC for secure, low-latency communication.
These networks enable use cases such aspredictive maintenance,autonomous robotics, andremote operations.

3. Cloud Service Providers

Cloud providers such asAWS, Google Cloud, and Microsoft Azureare entering the telecom domain by offering vEPC-as-a-service platforms, enabling telecom and enterprise customers to deploy scalable, virtualized cores efficiently.

Regional Analysis

North America

North America leads the global vEPC market, driven by strong 5G rollout initiatives, high mobile data consumption, and technological innovation.
The U.S. is at the forefront, with telecom giants likeAT&T,T-Mobile, andVerizonrapidly deploying virtualized core networks to support nationwide 5G coverage.
The region also benefits from the presence of major technology providers and cloud infrastructure companies facilitating vEPC deployments.

Europe

Europe is a significant market, supported bystringent digital transformation initiativesandEU-funded 5G programs.
Countries such asGermany, the U.K., France, and Spainare investing heavily in network virtualization to enhance connectivity and promote Industry 4.0 applications.
The regions focus onopen standardsandinteroperabilityis driving collaboration among telecom operators and software vendors.

Asia-Pacific

Asia-Pacific is thefastest-growing regional market, led by China, Japan, South Korea, and India.
The regions strong focus on5G commercialization,massive IoT adoption, andsmart city projectsis fueling vEPC demand.
Chinas large-scale network infrastructure investments and South Koreas advanced telecom ecosystem make them global leaders in vEPC deployment.

Middle East & Africa (MEA)

MEA is witnessing steady growth, supported bysmart city initiativesandnext-generation telecom projectsin countries likeSaudi Arabia, UAE, and South Africa.
Investments in 5G networks underVision 2030andDubais Smart City Programare driving demand for virtualized core solutions.

Latin America

Latin America is emerging as a promising region, particularly inBrazil, Mexico, and Chile, where operators are expanding 4G networks and preparing for 5G migration.
Cloud-based vEPC solutions are gaining popularity due to cost-efficiency and scalability in developing markets.

Competitive Landscape

The vEPC market ishighly competitive, with global telecom and technology leaders focusing on partnerships, product innovation, and geographic expansion to strengthen their market position.

Key Players

• Cisco Systems, Inc.

• Huawei Technologies Co., Ltd.

• Nokia Corporation

• Ericsson AB

• ZTE Corporation

• Samsung Electronics Co., Ltd.

• Mavenir Systems, Inc.

• NEC Corporation

• Affirmed Networks (Microsoft)

• Athonet S.r.l. (HPE)

Recent Developments

• 2024:Ericsson launched its next-generation cloud-native core platform to support large-scale 5G network slicing.

• 2023:Nokia announced collaboration with AWS to deploy vEPC on public cloud infrastructure for enterprise 5G use cases.

• 2022:Mavenir expanded its vEPC portfolio to support containerized 5G core deployments for private networks.

Future Trends

1. Transition Toward 5G Standalone (SA) Architecture
   Telecom operators are gradually migrating fromnon-standalone (NSA)tostandalone (SA)5G networks, where vEPC evolves into a fully virtualized, service-based 5G core.

2. Integration of AI and Machine Learning
   AI-driven analytics will enhance network optimization, predictive maintenance, and traffic management in vEPC environments.

3. Increased Adoption of Private 5G Networks
   Enterprises will continue investing indedicated private networksto enhance connectivity and data security, driving vEPC demand.

4. Automation and Orchestration Platforms
   Automated network orchestration usingNFV MANO (Management and Orchestration)frameworks will streamline deployment and scaling.

5. Expansion of Open-source Ecosystems
   Open-source platforms likeONAP (Open Network Automation Platform)andOpenEPCwill encourage innovation and reduce vendor dependency.

Conclusion

Theglobal virtualized evolved packet core (vEPC) marketis at the heart of the telecom industrys digital transformation, enabling seamless scalability, efficient data management, and future-ready 5G capabilities.
As the demand forhigh-speed connectivity,low-latency communication, andcloud-based infrastructurecontinues to grow, vEPC will remain a cornerstone technology shaping the next generation of mobile networks.
Organizations investing incloud-native,AI-integrated, andopen-standard architecturesare well-positioned to capitalize on the vast opportunities that the evolving telecom landscape presents.

About Kings Research

Kings Research is a leading market research and consulting firm that provides comprehensive market intelligence and strategic insights to businesses across various industries.