Skip to main content

Upside Opportunities for Private Cellular Network Apps

In the past, most CIOs and CTOs would consider Wi-Fi infrastructure as the primary mode of delivering wireless local area network connectivity to their organization. Now, the development of fifth-generation (5G) cellular technologies has created alternative modes of wireless networking.

Moreover, the demand for private networks in the enterprise domain continues to rise. According to the latest worldwide market study by ABI Research, private cellular network deployments within the enterprise domain will generate equipment revenues of more than $64 billion by 2030.

While very large enterprises will likely drive the market for the next 10 years -- accounting for 50 percent of private networks by 2030 -- companies with annual revenues between $250 million and $1 billion will account for 40 percent of private networks by 2030, with their proportion expected to rise further beyond the forecast period.

Private Cellular Network Market Development

"These numbers underline the huge momentum that we see for private cellular networks as a key enabler for enterprise digitization," said Leo Gergs, research analyst at ABI Research. "As enterprises require highly customized deployment solutions, including deterministic & time-sensitive networking and are governed by strict regulations regarding data protection and network integrity, the deployment of a private cellular network will be their first choice."

While large manufacturers like Bosch, Mercedes, or Siemens certainly have the financial resources and the necessary expertise to manage and operate a cellular network on their own, typical enterprises with annual revenues below $1 billion do not have the resources nor capabilities.

Following a recent ABI Research survey among industrial manufacturers across key markets in Europe, North America, and the Asia-Pacific region, three out of five manufacturers would prefer their private network to be managed and operated by a third party.

To address this potential managed services revenue opportunity within mid-tier enterprises, the telecom service provider industry needs to develop appealing offerings that take into account the business realities of these less capable IT organizations.

Since many enterprises with revenues of up to $1 billion face some form of IT budgetary constraints, large upfront capital investments into wireless network deployment would serve as a true barrier to entry.

According to the ABI analyst assessment, in order to lower this barrier and promote enterprise cellular network deployments, the telco industry needs to rely less on traditional CAPEX intensive business models and instead develop OPEX-based wireless local area network (WLAN) offerings.

These new offerings will adopt a service-based approach to give the decision-makers some assurance of paying only for services they truly need. As a result, communication service providers must be prepared to grasp a unique upside growth opportunity for private cellular services within the enterprise domain.

Outlook for WLAN Applications and Growth

The need for the telco industry to adapt is underlined by a drastic change in the shape of the competitive landscape. The traditional mobile network operators are under attack. On the one hand, the dominant cloud hyperscalers are actively developing disruptive end-to-end solutions for enterprise connectivity.

"On the other hand, we see more and more specialized network operators like Ambra, Citymesh, and Edzcom, which reserve spectrum assets to provide private cellular for enterprises as a service-based offering. Considering this, network operators need to evolve their business models fast, to protect their slice of the cake from being eaten by anyone else," concludes Gergs.

Looking ahead, I anticipate that more business and IT leaders will seek ways to deploy ultra-reliable, high-speed, low-latency, power-efficient, and high-density wireless connectivity solutions for their organization. Furthermore, unlike a public 5G mobile communication network, each private 5G network will be customized for the unique attributes of the location and associated WLAN requirements.

That said, Wi-Fi networks are easier to deploy and relatively inexpensive compared to private cellular networks, making them more attractive where speed and economy are a higher priority. Private Wi-Fi networks are already utilized for numerous applications and use cases. Plus, wireless routers and access points that support new Wi-Fi standards, such as Wi-Fi 6, will offer many enhancements over prior technologies.

Popular posts from this blog

Industrial and Manufacturing Technology Growth

In an evolving era of rapid advancement, market demand for innovative technology in the industrial and manufacturing sectors is skyrocketing. Leaders are recognizing the immense potential of digital transformation and are driving initiatives to integrate technologies into their business operations.  These initiatives aim to enhance efficiency, reduce costs, and ultimately drive growth and competitiveness in an increasingly digital business upward trajectory. The industrial and manufacturing sectors have been the backbone of the Global Networked Economy, contributing $16 trillion in value in 2021. Industrial and Manufacturing Tech Market Development   This growth represents a 20 percent increase from 2020, highlighting the resilience and adaptability of these sectors in the face of unprecedented challenges, according to the latest worldwide market study by ABI Research . The five largest manufacturing verticals -- automotive, computer and electronic, primary metal, food, and machinery -

Rise of AI-Enabled Smart Traffic Management

The demand for smart traffic management systems has grown due to rising urban populations and increasing vehicle ownership. With more people and cars concentrated in cities, problems like traffic congestion, air pollution, and greenhouse gas emissions are pressing issues. Since the early 2000s, government leaders have been exploring ways to leverage advances in IoT connectivity, sensors, artificial intelligence (AI), and data analytics to address these transportation challenges. The concept of a Smart City emerged in the 2010s, with smart mobility and intelligent traffic management as key components.  Smart Traffic Management Market Development Concerns about continued climate change, as well as cost savings from improved traffic flow, have further motivated local government investment in these advanced systems. According to the latest worldwide market study by Juniper Research, they found that by 2028, smart traffic management investment will be up by 75 percent from a 2023 figure of

AI Software Market will Reach $251 Billion

The growth in Artificial Intelligence (AI) software could lead to many benefits. As more organizations adopt AI, they may become more efficient, productive, and able to offer improved products and services. The global job market could also expand, with demand growing for roles like AI engineers and technicians. Plus, AI apps could enable breakthroughs in fields like healthcare, transportation, and energy. The worldwide AI software market will grow from $64 billion in 2022 to nearly $251 billion in 2027 at a compound annual growth rate (CAGR) of 31.4 percent, according to the latest market study by International Data Corporation (IDC). AI Software Market Development The forecast for AI-centric software includes Artificial Intelligence Platforms, AI Applications, AI System Infrastructure Software (SIS), and AI Application Development and Deployment (AD&D) software (excluding AI platforms). However, it does not include Generative AI (GenAI) platforms and applications, which IDC recent