White Paper - 5g Private Network - Mason
White Paper - 5g Private Network - Mason
Introduction
▪ This document is a perspective written by Analysys Mason on behalf of Cisco that examines the private 5G market. It identifies key
sectors that will deploy private 5G networks, which applications will be used, and which key business outcomes will result from these
deployments.
▪ A private LTE/5G network is a cellular network that is built specifically for an individual enterprise. Such networks are commonly
deployed on a single site (for example, in a factory or a mine). A table of definitions can be found on slide 25.
▪ The remainder of this report is structured as follows:
― market overview
― key industries
― key applications
― business outcomes
― conclusion
― overview of Cisco’s private 5G solution.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes 4
Executive summary
▪ The private 5G market is at an early stage of development, but activity in the market is increasing. 5G accounted for over 50% of all
publicly disclosed private network announcements at the end of 2022, according to Analysys Mason’s Private LTE/5G networks tracker.1
5G’s share is lower when non-public announcements are included, but it is expected that most private networks will eventually use 5G.
▪ Enterprises are deploying private 5G for several reasons. 5G can help enterprises with their digitization goals by connecting devices to
generate useful data for the enterprise. Private 5G will enable automation, streamline production processes, and bring sizable cost
efficiencies. Private 5G will also help to develop emerging applications such as autonomous vehicles, drones and robotics.
▪ Enterprises can use private 5G to replace ageing technology (such as TETRA) or provide a cheaper and less complex alternative to wired
networks. Private networks are typically deployed to complement existing Wi-Fi networks. Wi-Fi is well-suited to connecting many indoor
applications and will continue to do so through the development of Wi-Fi 6 and Wi-Fi 7, but private 5G is particularly suited to outdoor
applications, and indoor applications that require dedicated, licensed spectrum.
▪ The manufacturing sector has led the deployment of private 5G thus far, followed by industrial sectors such as transport and logistics,
mining, and oil and gas. Private 5G has also been deployed to a lesser extent in other sectors, such as healthcare and the public sector,
and opportunities in these sectors will grow significantly over time. Common private 5G applications include industrial equipment,
automated/autonomous vehicles, location services and connected sensors. New 5G applications, such as those utilizing AR/VR, digital
twins and robotics will emerge over time.
▪ Many enterprises that have deployed private LTE/5G networks are already seeing positive business outcomes. Automation is the most
common goal and can help to reduce costs and increase productivity. Private 5G can also provide significant energy savings, helping
firms to meet sustainability goals, and improve on-site worker safety and security.
▪ The private 5G market is evolving rapidly. Enterprises that explore private 5G early will be well-placed to understand the technical and
commercial challenges associated with deploying a private network and will be able to see how private 5G can complement existing
networks such as Wi-Fi. 5G could also give enterprises a competitive edge by improving productivity and developing new, advanced
applications before competitors do so.
1 For more information, see Analysys Mason’s Private LTE/5G networks tracker.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes
Market overview: the private networks market is nascent, but is growing rapidly
5G networks are accounting for an increased share of the Figure 1: 5G share of all publicly announced private LTE/5G
growing private networks market. networks, 2019–2022
Analysys Mason’s Private LTE/5G networks tracker captures the
details of 400 publicly disclosed private network contract
announcements as of the end of 2022; we are also aware of over
1000 private network deployments that have not been disclosed
publicly.1 The market will grow rapidly; there will be almost 40 000
networks by 2027 and USD7.7 billion in network spend.2
LTE remains the most deployed technology for private networks,
but the 5G share of networks is growing. 5G accounted for over
50% of all publicly disclosed private network announcements at
the end of 2022. The 5G share is lower when non-public
announcements are included because firms are more likely to
publicly announce a 5G network than an LTE network given the Figure 2: 5G share of newly announced private LTE/5G
high interest in 5G. In addition, many private 5G networks remain networks, 2019–2022
at the trial/test stage.
Some of the barriers to 5G adoption are detailed on the next
slide. 5G adoption will accelerate as these barriers are removed
and will eventually be used in most private network deployments.
However, private 5G will be more suited to some sectors than
others. Industrial sectors such as manufacturing and transport
have been early adopters of private 5G, and others such as
healthcare and public sector will follow. The opportunities in these
sectors are outlined in slides 9–12.
1 For more information, see Analysys Mason’s Private LTE/5G networks tracker.
2 For more information, see Analysys Mason’s Spending on private networks will reach USD7.7 billion in 2027, but challenges
to adoption persist.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes 7
Market overview: drivers and barriers for the adoption of private 5G networks
DRIVERS BARRIERS
DIGITIZATION COST
Enterprises are digitizing their data and using it to create new Private LTE/5G networks can be more costly to deploy
digital products and services. The need for high-bandwidth, than Wi-Fi networks. Network components have been
low-latency networks to support increased automation will designed to cater for public networks, and many existing
grow as data processing requirements increase. business and pricing models are designed as such.
SPECTRUM AVAILABILITY
CONNECT NEW APPLICATIONS The availability of spectrum varies significantly by
5G will drive the development of new applications such as geography. Industrial spectrum is available in some
drones, AR/VR and digital twins. countries, but spectrum remains controlled by mobile
network operators in many countries.
Industrial sectors such as manufacturing and transport and Figure 3: 5G share of publicly announced private networks,
logistics will drive the deployment of private 5G. 2022
The manufacturing sector has been the main adopter of private
5G networks, driven by investments to support the automation of
factory processes. It accounts for 46% of all publicly announced
private 5G deployments as of 4Q 2022. This share will decline
over time as many indoor manufacturing sites will be served with
Wi-Fi 6.
Automation is a driver of private 5G adoption in other industrial
sectors: transport and logistics and mining and oil and gas. These
sectors account for 25% of the publicly announced private 5G
deployments to-date. 5G is well-suited to connect outdoor sites
such as mines and industrial plants. 5G enables the remote
control of vehicles and heavy equipment, thereby reducing the
need for on-site personnel and the likelihood of accidents.
Healthcare and the public sector currently account for just 11% of
private 5G networks, but this share will increase over time. Private
5G will be deployed at hospitals and medical facilities because
these sites require dedicated networks to connect medical
devices and carry sensitive medical data. 5G will also be used in
the public sector for surveillance and dedicated networks at
military bases. Other sectors, such as utilities and education,
currently account for a small share of private 5G and this is
unlikely to increase significantly. Private LTE is usually sufficient to
connect the simple applications supported in these sectors.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes 10
Figure 4: Summary of the top five industries that will deploy private 5G
Connected medical devices, remote • Meets regulatory requirements around transfer of medical data
Healthcare
examinations and remote surgery • High-bandwidth, low-latency use cases (remote surgery)
Manufacturing
The manufacturing sector is the largest private networks sector in terms of the number of addressable sites. It contains many large,
multinational enterprises that are willing to invest in private LTE/5G networks as part of ongoing digital transformation processes.
Analysys Mason estimates that almost half of existing private LTE/5G networks use 5G, and this will rise to almost 90% by 2030.
Automotive manufacturers have been at the forefront of private network adoption. Companies such as Volkswagen, BMW and
Mercedes Benz have deployed private 5G as a foundation for further automation and cost efficiencies, and most automotive players
have adopted 5G to support new automation use cases. A few manufacturers such as Porsche and Airbus have also trialed hybrid
public–private networks to which vehicles stay connected when moving from the private 5G network to the wide-area public network.
Top industries: the healthcare and public sectors have deployed private 5G to some
extent; more opportunities in these sectors will arise in the long term
Healthcare
The COVID-19 pandemic helped to accelerate the digitization of the healthcare sector. It also raised awareness of private cellular
networks and their potential use in healthcare settings. Public cellular networks are rarely an option in hospitals due to strict regulatory
requirements for the exchange of medical data on non-dedicated networks; private 5G can meet these requirements.
Private 5G deployments in hospitals to-date are mostly at the trial stage. However, there is significant interest due to the ability to
connect a range of applications. These include simple use cases such as bed occupancy and cold chain monitoring, but advanced
applications with high-bandwidth/low-latency requirements are also being developed. For example, Korea Telecom used private 5G to
test the use of robots to deliver supplies to operating rooms at the Samsung Medical Center in South Korea. Vodafone Germany is also
using a private 5G network to test a mixed reality solution for computer-assisted tumor surgery at Universitätsklinikum Düsseldorf.
Public sector
Several sub-segments of the public sector are interested in private 5G. Private 5G networks can be deployed by city municipalities and
made available for use by local businesses and institutions. For example, the City of Las Vegas deployed a private 5G network across
the city, including coverage of public spaces such as parks and event venues.
Private 5G networks can also be deployed for the sole use of the government or military organizations for surveillance and monitoring
purposes. Applications such as CCTV and drones require data streaming in real time, which 5G supports. Military organizations are
especially interested in the added security from using dedicated networks as opposed to public cellular or Wi-Fi networks.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes
Figure 5: Summary of the top five applications for private 5G Figure 6: Applications listed in publicly disclosed private
LTE/5G networks, 2022
Typical devices Sectors
5G LTE LTE/5G
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes 15
Industrial equipment
Examples of industrial equipment include machines, welding equipment and robotic arms on the production line. 5G enables this
equipment to be connected without the need for a wired connection and with better download speeds and latency performance than
Wi-Fi (particularly for outdoor applications). It also allows production processes to be increasingly automated, which will help to boost
productivity. Heavy equipment such as cranes and lifts can also be connected via 5G to allow them to be operated remotely.
Automated/autonomous vehicles
AGVs are commonly used in the manufacturing and transport and logistics sectors. They tend to use a wired connection, thereby
making updates and additions to guided routes expensive. Private 5G can provide greater flexibility. Autonomous mobile robots
(AMRs) are increasingly being trialed. AGVs follow a pre-set fixed route and can detect obstacles but do not navigate around them.
AMRs, however, use software to map out the most efficient route and can navigate around obstacles. Private 5G can provide a better
response time, a more stable connection and more precise geo-positioning than Wi-Fi.
Autonomous vehicles are also being tested in other sectors. For example, a private 5G network deployed by AIS in Thailand is being
used to connect unmanned electric vehicles in order to transport material and equipment to and from a mine. 1
Top applications: 5G provides rapid and reliable download speeds and will enable
the real-time tracking of assets and people
Location services
Asset tracking is a common IoT use case on wide-area networks and is being applied in private network settings. 5G can provide
accurate location service to within centimeters. Indoor sites such as factories and warehouses can use private networks to track the
movement of components, as BT is doing with a private 5G network for AE Aerospace. 2
Assets can also be tracked outdoors in transport hubs such as airports, ports, mines and industrial plants. For example, Edzcom
deployed a private 5G network at Steveco’s port terminals in Finland to obtain real-time container handling data.3 Private networks
can also be used to track people, such as lone workers in remote sites.
1 Vodafone (2020), Lufthansa Technik and Vodafone Business launch 5G private network.
2 Black Country LEP (2021), West Midlands company is first of its kind to use 5G to transform manufacturing.
3 Edzcom (2021), EDZCOM’s pioneering solution based on 5G architecture Edge Connectivity to optimize Steveco’s port operations.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes
Key business outcomes: private 5G can enable automation and bring significant
cost savings
5G-connected sensors on factory production lines can help to identify Automation can provide significant cost savings for manufacturers and
and resolve issues on the production line in real time. The use of AI industrial firms. It can reduce the number of workers that are needed
and automated systems can also improve productivity. on factory floors or remote locations (such as oil rigs). Large vehicles
and machinery such as cranes can also be operated remotely without a
• Airtel trialed private 5G for Bosch at Bosch Automotive Electronics
licensed operator needing to be physically present.
India. It connected Bosch’s Automatic Optical Inspection (AOI)
system, which required high speeds and low latency to send data in • Vale invested BRL21 million (USD4 million) in a private LTE network
real time. This reduced the time taken for quality assessment and at its Carajas mine to connect autonomous drills and a fleet of
Airtel cited reductions in the mean time to repair (MTTR) and the autonomous trucks. The use of autonomous equipment led to an
mean time between failures (MTBF).1 increase in equipment useful life by almost 15% and a reduction in
fuel consumption and maintenance costs by almost 10%. 3
• Celona deployed a private LTE network on behalf of a steel
manufacturer. This helped to reduce the unplanned downtime in • A private 5G network deployed at Jiangnan Shipyard was able to
the manufacturer’s scrap yard by approximately 70%.2 save more than CNY10 million (USD1.5 million) a year in spending on
labor and raw materials. It reduced the spending on production line
• A private 5G network deployed at Jiangnan Shipyard used an AI-
personnel by 10%.
based inspection system, AGVs and connected welding tools to help
shorten part of the shipbuilding process from 14 hours to 2 hours.
1 Airtel (2022), Airtel deploys India’s first private 5G network at Bosch facility.
2 Celona, Pennsylvania steel manufacturer taps Celona for 5G LAN.
3 Vale (2019), Vale will operate the first private LTE network in partnership with Vivo.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes 19
Key business outcomes: private 5G can help enterprises to improve worker safety
and reduce the energy consumption of industrial sites and buildings
Private networks can be used to track the location of workers in real Private cellular networks can help to reduce the energy consumption of
time. This is particularly important in sectors such as mining and oil industrial sites. Enterprises can connect lighting and HVAC equipment
and gas, where workers are in remote or difficult-to-reach areas. The and monitor water consumption to realize energy savings.
coverage of public cellular networks and Wi-Fi may be poor, but private
• Orange tested a private 5G network at a Schneider Electric factory
networks deployed on-site can provide reliable connectivity. Push-to-
and found that digitizing the factory could reduce energy
talk and other forms of voice communications can also provide a
consumption by up to 50%.2
dependable channel if workers need assistance. Safety in the
workplace can be further improved by using automated vehicles and • A network equipment provider deployed a private 5G network at one
equipment instead of human operators to remove a worker from risky of its factories and found that it resulted in a 25% decrease in the
areas. factory’s energy consumption and a 75% decrease in wastewater.
• LG deployed a private LTE network for BASF at a chemical factory. • Cisco, JTOWER, MKI and Airspan Networks collaborated on a private
The private network was used to track the real-time location of all 5G O-RAN trial in Japan to test in-building infrastructure sharing. The
people entering the chemical factory and to connect an access trial resulted in reduced CO2 emissions and reduced power
point beacon used for communication and evacuation alerts in the consumption.3
event of a chemical accident.1
1 BASF (2021), BASF and LG Uplus to establish safe and smart manufacturing environment.
2 Orange Business Services, The factory of the future takes its first steps with 5G.
3 Cisco (2022), Cisco, JTOWER, MKI, and Airspan Successfully Conduct Open RAN Trial.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes
Conclusion
The private networks market is at an early stage of development, particularly so for the 5G segment. The private 5G market will look
considerably different in 5- and 10-years’ time for several reasons.
▪ Most private 5G deployments are currently at the trial or proof-of-concept stage and many LTE networks are described as ‘5G-ready’. It
will take time for these networks to be optimised and for 5G devices to become readily available. The key use cases will become clearer
as these networks eventually translate to commercial deployments, and how 5G can lead to tangible benefits for enterprises will be more
obvious. Nevertheless, as the previous section of this paper demonstrates, many enterprises that have deployed commercial networks
are already realising benefits, ranging from automation-related savings to improved energy efficiency.
▪ Most of the enterprises that have deployed private networks so far have been very large enterprises. These firms have significant
resources to spend on building private networks and have their own in-house networking teams to understand and manage the network.
Private networks will have to be smaller, cheaper and less complex than existing networks to tap into the wider market beyond large
firms. Private networks will become more like Wi-Fi networks in some regards – relatively easy to deploy and manage – while also co-
existing along Wi-Fi to support demanding applications that require dedicated, licensed spectrum and a guaranteed level of performance.
▪ Private networks need to evolve to comply with enterprise operational requirements and standards such as security and worker safety.
Enterprises that begin private 5G trials now will be well-placed to understand these requirements and how to tackle them, putting them
in a strong position to scale up when the market matures.
▪ Geographic variation already exists in the private networks market. Unsurprisingly, most activity to-date has taken place in developed
countries or developing countries with mature IoT markets (such as China). There is also significant variation between countries within a
region due to the availability of spectrum. As such, some countries will race ahead with private 5G (China, Japan and Germany are early
frontrunners) and others will lag behind. This also creates opportunities for enterprises to gain an advantage over rivals by deploying
private networks before their competitors in countries where there is not yet much private networks activity.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes 22
Cisco Private 5G: take the complexity out of private 5G and IoT
Cisco’s Private 5G as-a-Service, delivered with global partners, provides enterprise customers with a comprehensive solution for managing
their private 5G networks. We enable enterprise and industrial edge use cases for IoT and industrial use cases that will help customers
across all industries to digitize their businesses and monetize their services.
With this solution, enterprises can reduce technical, financial, and operational risks associated with managing their networks. Cisco’s
Private 5G simplifies the financial aspect of network management, enabling enterprises to save money on infrastructure costs while easily
scaling services as needed. By integrating Wi-Fi 6, Wi-Fi 6E, and 5G networks, enterprises can simplify operations and avoid the need for
their IT staff to learn and operate complex carrier-class private licensed radio networks. This future-proof solution enhances existing
networks and provides trusted coverage and mobility in unique business-critical environments. Cisco’s Private 5G is a cost-effective, secure,
and efficient way for enterprises to deploy cellular services while maintaining IT policy and identity.
For more information, visit www.cisco.com/go/private5G
Cisco
Enterprise-ready Secure and trusted
Private 5G private 5G network Simple to start and by enterprises with
Expertise delivering
mission-critical use
with seamless operate unified identity and
cases
integration policy
Source: Cisco
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes
Annex: definitions
Private cellular network An LTE or 5G cellular network that is built specifically for the use of an individual enterprise/organization. Such networks
are commonly deployed on a single site (for example, in a factory or a mine). Private LTE/5G networks can also be
deployed to address wide-area network requirements such as a utility company’s need to monitor a transmission network.
AGV (automated guided vehicle) Semi- or fully autonomous robots used to transport and deliver raw materials and goods along predefined routes.
Autonomous vehicles A vehicle such as a car, shuttle bus or truck which controls its own operation without the need for a human driver. It differs
from an AGV in that it does not need to follow a predefined route.
TETRA (Terrestrial Trunked Networks) A European standard (via ETSI) for a trunked radio system, commonly used by public sector organisations such as
emergency services, transport firms and the military.
Wi-Fi 6 An IEEE standard for wireless local-area networks (LANs), also known as IEEE 802.11ax. Wi-Fi 6 uses the 2.4GHz and
5GHz bands and Wi-Fi 6E uses the 6GHz band.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes 25
Annex: definitions
Operation of storage, warehouse facilities and logistics activities, i.e. planning, designing 52
Logistics and supporting operations of transportation, warehousing and distribution.
Discrete manufacture of goods (e.g. furniture, machinery. electric equipment) and process 10--32
Manufacturing manufacture of goods (e.g. food, paper products, chemical products).
The mining and extraction of oil and minerals occurring naturally as solids, liquids or gases 05-09
Mining & oil and gas (including metallic ores).
Provision of public administration, defence and social security (includes provision of public 80, 84
Public sector goods such as streetlights).
Retail Trade of goods in stores, wholesale trade of goods (includes supermarket chains). 46-47
Supply of electricity, gas, steam and air conditioning, and supply of water, sewerage and 35-39
Utilities waste management.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes 26
Figure 10: private network announcements in the public domain Figure 11: private networks in the public domain by sector and
by year, 2019-2022 technology, 2022
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes 27
Figure 12: primary application listed in publicly disclosed private Figure 13: type of site of publicly disclosed private networks,
networks, 2022 2022
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes
Ibraheem Kasujee (Senior Analyst) is a member of the Operator Business Services and IoT research team in London and leads the IoT Services
and Private Networks research programmes. He has written on topics including private LTE/5G networks, IoT eSIMs and iSIMs and LPWA
networks, and has conducted research on IoT verticals such as healthcare and smart buildings. Ibraheem holds a BSc in economics from the
University of Warwick, and wrote his dissertation on the impact of technology on sleep.
Tom Rebbeck (Partner) leads Analysys Mason’s Operator Business Services and IoT research practice drawing on more than 20 years of
experience in the telecoms sector. Tom is a specialist on the Internet of Things (IoT) and other enterprise services and has written widely on the
role for operators as telecoms markets develop. As well as published research, he has worked on projects for a range of clients – including
operators, regulators, industry bodies and vendors. Many of these projects have been supported by original research, such as expert interviews
and customer surveys.
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes 30
analysysmason.com/what-we-do
Unlock the Power of Private 5G: Top Applications and Key Business Outcomes 31