Mobile Experts sees private 5G becoming commoditized in the 2030-2034 timeframe
Right now spending on private 5G systems is concentrated at the very top-end of the market; Fortune 500 companies with massive internal engineering support and deep pockets for digital transformation are footing the bill. But as the ecosystem is refined—meaning carriers, NEPs, system integrators, device OEMs and the end users continue to push the ball forward—Mobile Experts Founder and President Joe Madden sees private and industrial 5G solutions within reach of small- medium-sized businesses.
“We think there are millions of small companies out there that have something that they do that they’d like to automate that could use a private 5G network or a private LTE network,” he said during a session at the recent Industrial 5G Forum (available on demand here). “So we think that is a huge opportunity.”
By the numbers developed by his firm, Madden sees around $14 billion annual spend on private wireless today, which is a broad umbrella covering Zigbee, Bluetooth, cellular and other access mediums. Of that $14 billion, he said around $2 billion goes to LTE and 5G systems; he specifically called out railroad operations, mining and manufacturing as sectors investing in industrial 5G today. Looking ahead, Madden sees LTE and 5G eventually taking the bulk of private wireless spend.
Madden described a “readiness wheel” with spokes that represent system components like spectrum, radio networks, core technologies, devices, business models, and so forth. “And if we look at the market in general right now, the wheel is not really that round. It’s like the market’s not really ready to roll forward because in many applications, the business model is not quite there or maybe the devices aren’t ready for 5G.”
Now we get into the long tail of it all where companies are able to turn a profit by making a mass market out of very specific niches—something that will (ideally) become attainable as the technology moves from highly customized to something more plug and play. As Madden put it, “What we have up until this point in time has been private networks that are very customized and it takes a lot of engineering support…It’s what I would call a Fortune 500-type of a market at this point in time. But the way we see it is that that pyramid is going to grow and, over time, we’re going to move down from the Fortune 500 companies to the mid-size companies where you take those customized solutions and it becomes more or less a standard product.”
Madden specified that the 2030 to 2034 timeframe is when he sees “this market developed to the point where it’s like the cloud computing business where those platforms are very easy to use…I think that’s really the key to long-term success here.” Final thoughts: Madden pegged the cellular equipment market at around $40 billion today with private cellular representing something like $3 billion or $4 billion of the total. Over the next decade, he said, “We may see that private wireless market become much more important because it’ll be almost the same size and grow a lot faster.”
