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The Growing Case for Private 5G Networks

The concept of a private mobile network is not particularly new, as such networks first started using 4G LTE technology in some countries in industries such as mining, emergency services and defense. But hand-in-hand with the increasing deployment of 5G networks, the concept of a private 5G network is gaining traction in many parts of the world as regulators are increasingly offering enterprises the opportunity to purchase their own 5G spectrum and deploy their own mobile networks, and this is becoming particularly popular in places such as Japan and Germany. In Germany alone the government has already granted 88 private 5G licenses in the 3.7 GHz-3.8 GHz band including many of the country’s premier manufacturers. (1)

But why would an enterprise want to go through the trouble of licensing, procurement, operation, and maintenance for its own 5G network when it could just purchase connectivity from a telco as it has always done? This is not an easy question to answer and indeed for many companies the traditional B2B model will continue. But for some companies there is a growing business to deploy private networks due to the unique features that such networks offer.

For example, private 5G networks offer considerably more robust security offerings as they need not be connected to the larger telecom network, and hence are attractive to companies which very high security requirements such as power plants. Private 5G networks are also highly customizable and hence can be built to exact company specifications as opposed to having to select from telco offerings, and data can be managed and analyzed internally. Given that overall 5G rollouts will take time to offer truly nationwide service, especially indoors, private networks can also deliver robust connectivity now meaning customers will no longer have to wait. (2)

For these reasons there has been increasing momentum in the private 5G network sector in a variety of industries. Some of the most notable examples include:

Private 5G Networks in Manufacturing – Mercedes-Benz (3)

Manufacturing is one of the key sectors where private 5G networks are gaining traction as many companies are looking to construct their own networks in order to take the concept of Industry 4.0 to the next level. Mercedes-Benz is one of the large automotive manufacturers looking to do this and has in fact been working with German telco Telefonica/O2 in order to realize its private 5G network ambitions as part of a greater mission to continue to promote Digital Transformation within its operations.

The company has already started installing private 5G networks in its manufacturing facilities in Germany and claimed that its network in "Factory 56" in Sindelfingen was the world’s first private 5G network specifically designed to aid automotive manufacturing and covers over 20,000 square meters. Mercedes-Benz will operate this network themselves and will help optimize data linkage across various connected machines and track assembly line products in real time. The company has cited several reasons which led to its decision to deploy a private network, including the need for increased agility and shorter response times in the manufacturing process, and because data is stored internally there is no longer a need to share sensitive data with third parties.

Private 5G Networks in Healthcare – Rush Medical Center (4)

One of the fastest growing areas for private networks in the healthcare space, particularly as the COVID-19 pandemic has recently put incredible strain on the medical infrastructure of many countries. The rapid onset of COVID-19 suddenly caused demand of intensive care unit beds skyrocket and many countries are still struggling to modernize their facilities and build new infrastructure. This sudden increase in demand has also generated a demand for connectivity which has played a crucial role in both the construction of new healthcare facilities and the ongoing maintenance of existing ones and has led to some hospitals to elect to deploy private networks.

One such example of a private network being used by a hospital even before the COVID-19 pandemic can be found at the Rush Medical Center in Chicago in the United States. Back in 2019 the facility started to deploy a private wireless network which has gradually incorporated 5G technology. The initial rationale for incorporating 5G was based on their desire to remove the need for physical cables in its buildings which are very expensive to replace. The Rush Medical Center’s 5G network is also notable as it incorporates aspects of both a public and a private 5G network. One portion of traffic is allocated for the general public but there is also a dedicated allotment for first responders, and hence the quality of their mobile connections can be guaranteed.

Private 5G Networks in Smart Facilities – Groupe ADP (5)

Private 5G networks can help facilities become smarter by delivering significantly better mobile connectivity which can serve as an engine to drive Digital Transformation, and hence there is significant interest in deploying these networks in venues such as airports, stadiums, and office buildings. By doing so, these venues can quickly upgrade connectivity, especially indoors where it is much harder to achieve high quality mobile signals, and then a new suite of advanced IT solutions can be deployed in a much faster and secure fashion. Upgrading from 4G to 5G also allows these smart facilities to transition to more bandwidth intensive and low latency services such as high-definition video feeds and real time analytics monitoring.

Airports are one such sector, and recently Groupe ADP and their subsidiary Hub One announced that it will build a private 5G network which will cover the three airports in the greater Paris area - Paris-Charles de Gaulle, Paris-Orly and Paris-Le Bourget airports in cooperation with Air France. This network will provide high-quality connectivity to the more than 120,000 employees who work in these facilities on a daily basis and will be used for voice, data and video communications, emergency services and more advanced services such as luggage tracking and will aid in Air France’s long term DX goal of having all of its communication devices connected to this network.

Private 5G Networks in Logistics – Port of Antwerp (6)

The logistics sector is another segment which holds great potential for private 5G networks, as locales such as warehouses, distribution centers and ports have a constant inflow and outflow of goods which must be tracked and have a very diverse range of connected devices ranging from packages, shipping containers, connected cameras and heavy machinery, among others. Growth in e-commerce has led to increasing efforts to automate many logistical functions with robots which also have high connectivity requirements. Hence private 5G networks can offer significant benefits to logistical facilities which are looking to accelerate their Digital Transformation plans.

Ports are therefore one of the first movers in the private 5G network space, and for example the port of Antwerp, Belgium has started to create its own private 5G network. The company is deploying a 5G network which will cover the entire area of the port and will be used for applications in areas such as automation, logistics, safety, and security. Interestingly the port is partnering with other government bodies such as the local police and firefighting authorities who are using the same network to develop public safety solutions such as drone and high-definition security camera monitoring.

Private 5G Networks in Transportation – NEC Mobility Test Center (7)

The global transportation industry is another area where private 5G networks will play a large role, particularly when it comes to autonomous vehicles. In order for a truly driverless world to come to fruition, technologies such as edge computing, AI and “Vehicle to X” (V2X) communications will have little to no room for error. As a result, it may take many years for 5G networks to be robust enough to handle self-driving vehicles alone, and private 5G networks can step in and fill this gap. And indeed, there are already private 5G networks which are managing self-driving vehicles at the local level in places such as factories and port facilities.

In November 2020 NEC unveiled its new Mobility Test Center in Gotemba City, Japan which is using a private 5G network in order to help demonstrate the potential that 5G has in the transportation industry. The site has many 5G connected devices including 5G-connected traffic lights and pedestrian crossings, 5G-connected edge terminals and C-V2X roadside units, and edge-based IoT cameras and AI processing devices. By using a private 5G network, NEC is able to operate all of these connected devices with high levels of precision in a controlled environment and will be able to continue its R&D efforts as it works to bring these solutions to the market.

What Does the Future Hold for Private 5G Networks?

It has become clear in recent months that there is significant demand for private 5G networks from a variety of industries, and momentum continues to mount. And while several different rationales have emerged for building a private 5G network, the underlying theme seems to be that private networks can serve as a catalyst for Digital Transformation by offering robust, customizable, and secure next-generation connectivity. Going forward, as more regulators offer spectrum for private networks and the 5G ecosystem matures a whole, deployment costs will fall and private 5G networks will be an increasingly attractive option for smaller organizations.

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(March 5, 2021)