Industry 4.0 drives the need for 5G and private networks in the enterprise

​According to GlobalData, Europe is leading the way in 5G and private networks, with the region making initial progress in Industry 4.0 "smart factory" deployments. The company's latest ConnectedEnterpriseTracker shows that the manufacturing industry accounts for almost a third of 5G and private network deployments, with most of the activity concentrated in Europe, which currently accounts for 56% of deployments. However, this should change as North America and other regions will also see growth.

To date, the tracker has included around 300 private 4G/5G network deployments, as well as dozens of enterprise IoT deployments leveraging public 5G networks. While market leader Nokia says it has delivered more than 450 private networks, most of these deployments are not publicly disclosed and are therefore not included in the tracker. The same restrictions apply to other vendors, including leading network infrastructure vendors, system integrators, telecom service providers, and wireless technology specialists.

Private 5G Network

Private 4G and 5G networks are already being used to a large extent to support industrial verticals, including manufacturing, transportation, mining, and logistics. These industries can create new process efficiencies by connecting and automating operations, supported by highly secure networks. Other verticals are also taking advantage of private networks. Government agencies account for 8% to date, with the majority supporting smart city use cases such as connected streetlights or "smart poles" for environmental monitoring and electric vehicle charging.

Service providers appear to be involved in a large number of deals in Europe, suggesting that the spectrum assets used for these deployments are not necessarily based on bands recently made available for industrial use by regulators, such as those in Germany and the UK. Instead, licensed operators often offer dedicated bands or network slices to meet the needs of these customers. Vodafone, Deutsche Telekom, Telefonica, BT, Orange, Swisscom, Tele2 and Telia all have various deployments in place, often in partnership with Nokia, Ericsson or Huawei.

The U.S. does not dominate vertical markets

In North America, educational institutions account for more 5G and private network deployments than any other vertical (17%), although no one vertical dominates the application. The appeal of manufacturing, mining, transportation, utilities and energy is also evident. The US CBRS (Citizens Broadband Radio Service) spectrum is cited for use in about a third of these networks.

In addition to Federated Wireless, Boingo Wireless and other CBRS specialists, major vendors include AT&T and Verizon, system integrators and network vendors. GlobalData’s tracker does not break out private 4G and 5G because many organizations are using both technologies or are on a migration path from 4G LTE. But at least three-quarters of the tracker’s private network deployments mention 5G in public statements.