The UK Private Cellular Networks Market

Foreword This report has been commissioned by Digital Catapult to provide an informative and realistic appraisal of the Private Network landscape in the UK.

UK5G led the creation of the report, bringing together insights from real world experience of deploying private networks from across the DCMS 5G Testbeds & Trials Programme, with insightful landscaping work provided by delivery partner Real Wireless.

Executive Summary

This report aims to introduce the UK’s private cellular networks market landscape to prospective end-users and buyers. The report makes no policy recommendations, but rather defines key terms, outlines benefits, opportunities, challenges and key technologies and introduces some prospective suppliers and representative examples from the UK.

Private Cellular Networks (PCNs) have been around in the UK for decades. With the advent of 4G and 5G, they add a powerful tool in the panoply of enterprise networking technologies – enabling even those most stringent and demanding business-critical wireless industry vertical applications – spanning industries as diverse as healthcare, manufacturing, transport, logistics and construction.

Private networks combine with established and new industry vertical specific disciplines and technologies, such as med-tech and production automation (Industry 4.0), to deliver new value propositions. The industry vertical applications (or use cases) are the most important thing here – and the value that they bring. Benefits are often perceived in terms of value innovation, and this is enabled by the latest technology innovation.

However, the supply and demand sides arrive at this space from rather different experiences, speak different languages and perhaps have not yet bridged the gap; so prospective buyers often don’t know where to start on this journey. Buyers want a clear supply-side ecosystem that can speak their language, know their needs and can make it easier for them to understand, explore, source, deploy and manage these private networks to deliver meaningful value from them – and can tailor their approach and propositions for each industry vertical they interact with.

In the UK and elsewhere, industry specialist systems integrators, specialist private network and neutral host service providers and industry hubs – such as eHealth and the Manufacturing Technology Centre – potentially offer good starting points for prospective adopters on their journey of discovery and ultimate adoption; the UK has pioneered innovative and co-operative business models that bring together the enterprise client, the service provider, the system integrator, technology vendors, the mobile operator(s) and spectrum owners. These business models are now starting to become more mainstream and getting adopted by more supply side players in the UK and beyond and will be key to unlocking wider adoption at scale.

4G is the mainstay for much of the market today – mostly due to cost and availability of suitable 5G systems. A transition to 5G is expected to complete over the next 2-4 years. 5G’s key benefit (over 4G) is recognised to be its superfast speed but even more so its low latency and IoT enhancements – which meet specific automation needs of many industry verticals. Other stand-out 5G features are its ground-up support for mobility, security and edge computing. There is also an abundance of shared access spectrum that can be used for 5G, in comparison with a shortage of 4G shared access spectrum.

There are still some early market challenges in this space, mostly around spectrum management, system integration skills, a cost premium for 5G and general market maturity. This stage is characterised by slow initial uptake and some difficulties matching buyers and suppliers; however, the UK market has shown great impetus and promise. Most of these teething problems are being addressed by a vibrant and ever maturing ecosystem, supported by the UK Government and its relevant agencies and programmes (UK5G, Digital Catapult, Ofcom, 5G Industrial Testbed and Trials Programme, the Manufacturing Technology Centre and eHealth, Innovate UK) under the leadership and co- ordination of the Department for Digital, Culture, Media & Sport (DCMS) and the Department for Business Energy, Industry & Strategy (BEIS).

Private network technologies are ready for widespread adoption at scale today. Whilst value can be extracted immediately, private networks have a 10+ year growth trajectory ahead of them – with some expecting a 1 Billion market opportunity in the UK alone. This is underpinned by a solid technology roadmap, backed by global technology standards bodies, major telco suppliers and emerging innovators. Increasingly joined by major IT vendors, blue chip system integrators and cloud hyperscalers as the ecosystem to bring forth the benefits of scale, investment, cloud-native virtualisation, business solution integration and digital business transformation.

This report serves as an introduction to the current UK market landscape. The body of the report that follows, builds on the points outlined above. Other relevant or more detailed publications and resources can be found in the UK5G, Digital Catapult and the Small Cells Forum websites.