There's a lot of money in private mobile networks

Private network revenues will exceed US$64 billion by 2030, according to relatively new figures from ABI Research.

The proliferation of recent news announcements relating to the deployment of private mobile networks has already given us a strong indication of how hot that market is shaping up to be. But the newish research, which ABI seems determined to extract maximum publicity from, shows that there is a heck of a lot of money in it too.

The demand for private networks will be driven primarily by heavy industry verticals, the analyst firm noted, with industrial manufacturing and energy production, including mining, oil and gas, and logistics, accounting for just over half of that $64 billion figure.

The growth in demand for automation and enterprise digitisation has been accelerated by the Covid-19 pandemic, with businesses in industrial manufacturing, logistics, and oil and gas pushing harder on their plans for digitisation, said Leo Gergs, Research Analyst for 5G Markets at ABI Research.

In addition, the private networks market will also benefit from a supply-side effect, Gergs said.

“The freeze of Release 16 gives enterprises the much-needed reassurance of 5G capabilities for enterprise-grade connectivity, which allows chipset and module manufacturers to grow the device ecosystem for compatible hardware,” he explained. (More about the latest release of the 5G standard here.) “The maturing device ecosystem, in turn, drives down prices per module and therefore makes the deployment of private 5G network more cost-efficient, which will spur additional interest from enterprises.”

There can be no argument that enterprises are indeed interested.

Earlier this week German telecoms regulator the Bundesnetzagentur, or BNetzA, announced that it has had 93 applications for 3.7 GHz-3.8 GHz spectrum set aside for private 5G networks in the past year and has granted a total of 88 so far. As well as the likes of Airbus, Audi and Mercedes-Benz, its list of successful applicants includes chemicals company Evonik Industries, vehicle automation company Götting KG, ml&s manufacturing, logistics & services, telecoms contractor MUGLER AG, and power grid and gas network Netz Leipzig GmbH, to name a handful.

And that’s just Germany. In the past few months there have been myriad private networking announcements from all over the world, including Huawei’s partnership with Cambridge Wireless for a private 5G network at the Cambridge Science Park in the UK; Verizon teaming up with Nokia for private 5G networks internationally; and Ericsson’s $1.1 billion Cradlepoint buy that will, amongst other things, boost its 5G private networking capabilities.

Demand is there for private networks and there will be many more announcements to come.