The total addressable market for private networks – including the Radio Access Network, Mobile-access Edge Computing (MEC), core, and professional services – is forecast to increase from $3.7 billion in 2021 to more than $109.4 billion in 2030, according to a report by ABI Research.
The report forecasts that the market for 5G private networks will reach $47.5 billion in 2030, up from $221 million last year, while the total market for 4G private networks will go from $3.54 billion in 2021 to $66.88 billion in 2030.
“While the Third Generation Partnership Project (3GPP) has frozen Release 16 (standardizing Ultra-Reliable Low-Latency Communication (URLLC)), Release 16-capable chipsets and devices have not yet emerged in the market. As enterprises require Time-Sensitive Networking (TSN), as well as high availability and reliability of their connection, they are reliant on Release 16 and are, therefore, waiting for compatible chipsets and infrastructure to enter the market. As this is not expected to happen until 2023, enterprise 5G will mature much more slowly than previously anticipate,” ABI Research said.
The research firm also noted that the global spending on smart manufacturing will expand from $345 billion in 2021 to more than $950 billion in 2030.
“As manufacturers advance their digital transformation initiatives, they drive up spending on smart manufacturing with investments in factories that adopt Industry 4.0 solutions like Autonomous Mobile Robots (AMRs), asset tracking, simulation, and digital twins,” ABI said. ” While most of the revenue today is attributed to hardware, the greater reliance on analytics, collaborative industrial software, and wireless connectivity (Wi-Fi 6, 4G, 5G) will drive value-added services revenue — connectivity, data and analytic services, and device and application platforms — to more than double over the forecast.”
ABI Research noted that the main activity in all industries is supporting the shift to digital threads through better data management and enrichment throughout the manufacturing life cycle. “A typical data backbone allows manufacturers to operate more efficiently across teams and departments. Increasingly, more data sources can be cross-compared and overlain in real time for more contextual and predictive operations. The most advanced manufacturers are starting to think along these lines, while the majority have already begun their digital transformation journey, though they have yet to fully scale,” the research firm added.
Regarding the technology behind cellular IoT modules, the report highlighted that LTE dominates the market, with nearly-three quarters of all cellular IoT modules shipped in 2021, a share set to increase to more than 90% by 2026.
“The IoT is a market of efficiency, that thrives off the maximal availability and affordability of mature technologies,” ABI said. “5G is not there yet, nor will be for some years to come. Connected cars, and fixed wireless terminal applications are the low-hanging fruit for 5G, being markets that hunger for raw throughput.”
“For other IoT applications 5G’s utility is more nuanced, in manufacturing and healthcare for example, where time-critical services benefit from low latency, especially in private networks. But these are sectors that do not adopt technologies on a whim and require extensive industry testing first. For most other use cases, established and yet-to-be established, LTE is ‘good enough’, just as Wi-Fi has been. And herein lies 5G’s problem. It needs to be as available and as affordable as LTE, and is likely to receive no premium for its abilities above and beyond LTE,” ABI Research said.
