Policy and Charging Rules Function (PCRF) 5-Year Forecast, 2016-2020, March 2016

In a recently published report, Exact Ventures predicts that the Policy Server/PCRF market will grow from $769 M in 2015 to $1.5 B in 2020, a compounded annual growth rate (CAGR) of 14%.  Voice-over-LTE (VoLTE), increasingly complex data plans, and video services will prompt mobile operators to continue their strong investment in their policy infrastructure.  Similarly, wireline and cable operators increasingly need to manage the content and services that ride on top data services.

Like most core networking elements, the PCRF market is expected to transition from hardware-based nodes to virtualized network elements or VNFs.  We expect that session shipments will transition to VNFs more quickly in percentage terms than revenues.  We forecast that over half of all session shipments in 2020 will be VNFs.  The disparity in the revenue and session shipment transitions is due to the anticipated price differences between PNFs and VNFs.