Cloud, software, fiber, 5G core, automation, and backbone optical upgrades drove a strong surge in telecom operator infrastructure spending during the first quarter of the year, with Cisco, Microsoft, and Samsung among those vendors that gained the most market share from that spend, according to a recent report from MTN Consulting.

The research firm found that network infrastructure sales into the telecom vertical increased 5.7% year over year to $55.5 billion in the first quarter. That growth helped boost spending over the past 12 months more than 9% to $327 billion in total telecom capex.

MTN attributed some of that growth to operators re-investing into their networks following a slowdown in 2020 tied to the COVID-19 pandemic. But, it also found surging consumer demand is forcing those operators to increase their investments.

The overall market continues to be dominated by telecom-focused stalwarts like Huawei, Ericsson, and Nokia, which combined accumulated just under 39% of the market’s total revenues. However, each actually lost market share year over year.

Cisco, backed by strong 5G core and backbone upgrades; Microsoft, due to increased 5G core sales; and Samsung thanks to its Verizon 5G deal were among vendors that posted the biggest year-over-year share gains. The research firm also noted that Dell Technologies and VMware showed independent sales growth for the quarter.

MTN also reiterated its position that the dominate hyperscalers are becoming bigger players in the telecom network infrastructure market. It found that Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP) generated $3 billion in 12-month run-rate revenues during the first quarter.

The research firm noted that all three hyperscalers were “investing heavily in telco-specific solutions and partnering with telco-focused vendors to supplement their own offerings.”

“The telco market is one of dozens of vertical markets being attacked by the cloud providers right now, and is not the biggest one,” Matt Walker, chief analyst and CEO at MTN, wrote in the report. “But the cloud providers clearly will continue to impact the market, and expand the range of technical options available to telcos as they evolve their networks.”