Private networks are catching on, but they are the furthest thing from a fad. Not only have they been around for a while, but, according to reports, private-network deployments are set to increase drastically in the coming decade and beyond, as an unavoidable opportunity for dedicated coverage.
Private Networks in a Nutshell
For example, private network revenues were forecast to exceed $64 billion by 2030, according to ABI Research. Meanwhile, speaking to 6GWorld, Harris Samaras, an analyst in the field, relayed a separate ABI statistic predicting that, by 2036, investment in private cellular will surpass investment in public cellular.
“That means by 2036 companies are going to spend more money for private networks than operators for nationwide networks,” he said, adding that the advent of Industry 4.0 is accelerating matters.
“You can have a [private] network and service assurance on the kind of coverage and output you can receive,” he said. “If we’re talking about a big manufacturing site or a mining site this is important because, if you don’t have a stable network, then your operations might be disrupted – and, if your operations are disrupted, that can be [expensive]. Now, with this boom of IoT and sensors and automation, we see in the industry that there are really high requirements in terms of coverage and broadband capacity.”
Indeed, additional benefits to enterprises include higher levels of security and coverage relative to public networks. While LTE private networks are prominent, 5G-based ones can theoretically provide the ultra-low 1 ms of latency required by specific applications.
“You get a better experience if you’ve got 5G,” said Matt Hatton, Founding Partner of research firm Transforma Insights, speaking to 6GWorld of possible applications.
“There are things like autonomous vehicles. By that I mean for instance in packing warehouses for online retail. Managing the way those devices coordinate their activities would be another one, because you probably want the lower latency to ensure you don’t get the collisions between the vehicles. It’s roughly 5-10 times lower latency with 5G than it would be with LTE,” he said.
Private Network Shift to 5G
In its October market status update, the Global mobile Suppliers Association (GSA) estimated there are approximately 330 companies globally investing in LTE or 5G-based private mobile networks today. Speaking during a GSA webinar called “Private LTE and 5G networks and spectrum worldwide,” Vice-President of Research Simon Sherrington described the number as “likely to be a substantial underestimate,” though.
With the roll-out of public 5G, a shift is also likely. Sherrington said the GSA is expecting customers with private networks on older technologies to upgrade to LTE or 5G in the coming years.
“In many countries, utilities and emergency services have historically been allocated dedicated slices of spectrum for their private networks, although many would potentially argue they don’t have enough spectrum to support their future requirements,” he said. “But with the arrival of 5G, regulators in many countries are considering allocating, or are already allocating, more spectrum to enable private network deployment with the aim of enabling and encouraging digital industry development.”
Sherrington added that the Association also tracks many public Narrowband IoT (NB-IoT) and LTE-Machine Type Communication (LTE-M) networks used for IoT initiatives. They might add to the total moving forward.
“IoT projects could be classified in the future as private networks, for instance through the use of network slicing and operating sub-licensing or specific spectrum bands in specific locations. GSA has catalogued 110 NB-IOT and 49 LTE-M deployed networks worldwide as of October. So there’s a strong base of technology there that can be used,” he said.
A Place for Private Networks in IoT
Ultimately, private networks will grow in tandem with IoT, argued Transforma Insights in a recent report. The research firm estimated 25.4 billion devices would be connected by the end of 2030, tripling from 7.7 billion at the end of 2019. In contrast, 150 million cellular devices are projected to be connected to on-premise private networks in 10 years’ time.
It’s admittedly a much smaller number in comparison. However, considering it’s an increase from 3 million (50X) in 2019 Hatton nevertheless sees a huge opportunity there, speaking to 6GWorld following a Transforma webinar, “Forecasting the IoT market opportunity 2019-2030.”
“[The number of cellular devices connected to on-premise private networks] grows faster than the market, as you can see from it growing from 0.3% to 3% [as a proportion of all cellular devices]. They’re high-value use cases as well,” he said, pointing to the sheer number of devices as the primary reason for the discrepancy. He used environmental monitoring and tracking applications as one example, as well as consumer electronics devices that aren’t associated with revenue as another.
“We shouldn’t necessarily equate volume with value. There are a lot of connected devices out there, but obviously the growth of the roll-outs and the networks will be the determining factor,” he said. “There aren’t that many private networks deployed today, except for cellular technologies and obviously seeing those rolled out will encourage the adoption of these use cases.”
Feature image courtesy of Gerd Altmann (via Pixabay).