New wireless network technology is already a fundamental component of every enterprise CIO or CTO agenda in 2022. However, IT vendors and telecom providers must assess the broader enterprise connectivity technology landscape in order to determine where private cellular networks will add value.
According to the latest worldwide market study by ABI Research, the overall market for private cellular networks within enterprise industry verticals will reach $109 billion by 2030.
This includes radio access network (RAN), edge networks, core network deployments, as well as vendor professional services revenues, which alone will contribute $47 billion (44 percent) to the overall market size in 2030.
Private Cellular Network Market Development
"These numbers essentially tell two stories," said Leo Gergs, senior analyst at ABI Research. "The first is that they illustrate the immense opportunity for cellular connectivity within enterprise verticals. The second is that the high percentage of professional services indicates that bringing 4G and 5G to enterprises requires significantly more than just providing a private network."
This is particularly true as the wireless technology landscape within enterprises is somewhat fragmented. Enterprises have a plethora of connectivity technologies at hand -- such as Wi-Fi, Bluetooth, or Zigbee wireless network standards.
According to the ABI assessment, expecting private cellular networks to emerge and knock off all these established technologies will forever remain a telecom service provider's dream. The telco industry, however, needs to accept the market reality and understand this is not likely to happen.
Consequentially, the telecom carrier industry should carefully work out the role of private cellular networks within this abundance of enterprise connectivity technologies to discover their unique selling proposition.
According to Gergs, "To put it bluntly, enterprises do not care whether they are deploying 4G, 5G, 6G or even non-cellular technologies on their site. What they are primarily concerned about is whether or not their specific pain points are addressed."
As such, the telecom sector needs to move towards providing entire enterprise-grade solutions "as a service" -- something that Chinese infrastructure vendors have been doing successfully for a while now.
It is important to realize that the mobile telecom industry must act sooner rather than later. Enterprises have been waiting for vitally important 5G capabilities like ultra-reliable low latency and massive machine-type communication for years. So, they're understandably becoming impatient.
Outlook for 5G Private Network Applications Growth
Looking ahead, 2022 will therefore be a crucial year for enterprise 5G network deployments. This is the year where market expansion and applications growth should start to gain momentum.
We will either see the first steps away from trials, testbeds, proof-of-concept deployments by the end of the year, or the future for enterprise 5G private networks will become increasingly unpredictable.
"A crucial step will be the emergence of enterprise-grade devices that address the key requirements to serve particularly mission- or even life-critical use cases," concludes Gergs.
That said, I believe the upside growth opportunities for 5G private network applications will emerge once several compelling use case examples and associated business outcomes have been established and verified. All technology investments require a business case for serious consideration of enterprise IT budget allocation approval.