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Juniper Research forecasts that enterprise spending on private networks will be near $10 billion globally by 2028, rising from $1 billion in 2023.
A new study from Juniper Research has found that, by 2028, the market value for private networks will reach $10 billion worldwide, rising from $1 billion in 2023.
The three verticals driving the market are:
- Manufacturing – 35%
- Energy – 20%
- Public Services – 16%
Adopting Industry 4.0 and 5.0 best practices requires more frictionless coordination of automated processes and devices, thus requiring high-level orchestration via software-defined networks. This level of complexity means that manufacturing will be a critical use case for the more rapid adoption of private networks to support high-device density operations and ultra-low latency operations.
Flexibility, security, and easy deployment are essential for enterprises looking to roll out a private wireless network. Most mobile devices are either cellular capable or can be connected to a cellular gateway by Wi-Fi. Additionally, many IoT devices, including sensors, can use cellular-based low-power wireless services such as NB-IoT or LTE-M.
Furthermore, the arrival of the embedded SIM (eSIM) has facilitated the deployment of many devices. Organizations can now provision new connections without physically needing to access the machine and send secured data and updates over the network.
Cellular technologies provide a closed network that enterprises can fully manage. For any cellular connection to access a private network, it must be authorized by the network operator.
Private networks utilize the company-owned infrastructure and work with existing Wi-Fi to offer reliable and low-latency networks for important machinery. Furthermore, such networks provide alternative technological advancements like Wi-Fi, Bluetooth, or Ethernet. Businesses may benefit from private networks offering lower latency, enhanced control, reliability, and a more tailored experience for customers.
Private networks can use both 4G-LTE and 5G radios
LTE (4G) private networks arrived with the sunsetting of 3G, and in areas where Wi-Fi connectivity is inadequate, they are widely adopted across the globe. Despite the advent of 5G, LTE networks remain the most popular and dominant technology for the networks businesses and enterprises use.
(Source: Juniper Research)
5G private networks operate as an alternative to Wi-Fi to deliver cellular connectivity for private network use cases, including private businesses and third-party providers. The higher costs of 5G over LTE deter some organizations from upgrading to this new radio, as 5G rates are higher. To make 5G networks more accessible, network operators need to lower the prices of 5G services and 5G-compatible devices to incentivize more customers to migrate from LTE to 5G networks.
“Nokia estimates that the private 5G market will grow faster than the rest of the market, which makes sense because it’s starting from a very small base,” Peter Jarich, head of GSMA Intelligence, said in an interview during MWC. “We see lots of interest in private networks. We’re seeing lots of great examples, whether it’s in manufacturing, whether it’s in ports, whether it’s in mines. Everyone has a bunch of great examples. What I think is most interesting about private networks is that it’s like talking about 6G.”
While LTE provides most of the functions for a private industrial network to function correctly, upgrading to 5G creates a path to the future and offers better connectivity and new services.
LTE services such as NB-IoT and LTE-M are part of the 5G standalone specifications. Additionally, 5G Advanced, which will arrive next year, lowers power consumption, enables network slicing, and supports critical IoT services with higher bandwidth and ultra-low latency.
Therefore, it is possible to continue using existing devices while upgrading to a 5G private network, and new devices could leverage the new radio benefits.
In their report, Juniper Research urges private network vendors to “offer enterprises an ongoing managed service approach. This will enable private network vendors to maintain a continuous relationship with their customers and benefit from recurring revenue. Ongoing technical support and other value-added services will be necessary to maximize customer value proposition.”
As the industry moves toward more industrial and corporate services with new features like 5G Advanced, Wi-Fi 7, and virtual and augmented reality, the demand for more bespoke network deployments will continue to grow. Now, many players are ready to grab a piece of the action, both on the infrastructure and software side.
(Main image credit: Nokia)
The post Massive digitalization fuels adoption of private networks appeared first on IoT Times.
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