A fully digitalized and connected world was unimaginable for us a few years ago. However, thanks to the development of 5G, this vision is now becoming a reality. 5G is a collection of optimized and updated mobile communication technologies and new characteristics coming from the change of frequency: 4G (<3 GHz) à 5G sub-6 (3.5 – 7 GHz) and mmWave (>24 GHz). Together with new technological advancements such as network slicing and edge computing, 5G provides much larger bandwidth, lower latency, higher reliability, and more connections in comparison to the previous cellular generations.
In the first phase of 5G development, the focus is still on the business-to-consumer (B2C) market. We've seen telecom operators worldwide actively installing 5G macro base stations to provide networks with high capacity for consumers using mobile devices over the past two years. This trend will continue but will not stop here. The blue ocean of the 5G market lies in the business-to-business (B2B) segment. With high data throughput and ultralow latency, 5G can tap into many high-value areas including 3D robotic control and virtual reality monitoring, areas that previous technologies were not able to address. In the future, IDTechEx expects to see many industries such as manufacturing and logistics be redefined and reshaped by 5G.
5G small cells will play an essential role in 5G networks for connected industries. Small cells, with the characteristics of easier deployment and cheaper costs compared to macro base stations, have been utilized for enterprise purposes back in the 3G era. Since 2016, over 1 million small cells have been shipped for enterprise purposes each year. Nevertheless, compared to how many connections are achieved via wired connections, cellular wireless networks still have huge room to grow. Take Industry 4.0 as an example, most connections are achieved via ethernet (46%), wireless networks in industry 4.0 Internet-of-Things (IoT) nowadays only take up 6%. One of the bottlenecks is that flexible manufacturing systems are still not prevalent. Other challenges include the lack of feature support in device components and performance validation. Regardless, 5G development is driving demand towards wireless networks. IDTechEx forecasts that there will be around 45 million 5G small cells deployed by the end of 2031, for more information, see the IDTechEx latest publication, "5G Small Cells 2021-2031: Technologies, Markets, Forecasts".
According to IDTechEx, the three primary reasons why 5G networks enable connected industries and automation:
- Efficient and flexible working environment: 5G connectivity can replace traditional wired connectivity – this will enhance communication between machines but also between humans and machines. For example, with 5G, workers are free from fixed terminals and can communicate with machines using virtual reality (VR)/ augmented reality (AR) over tablets at any 5G covered location. Additionally, wireless connectivity also brings much greater flexibility to production lines.
- Boost product efficiency: With 5G, the massive amount of data generated from different types of sensors can be collected and analyzed on-site instantly. This in turn allows machines to optimize themselves based on the feedback data they receive. Furthermore, the analyzed data can also be used to predict the need for future maintenance or any potential problem that may arise.
- Industrial-grade performance: 5G has extremely low latency, high bandwidth, fast data speeds, and high reliability that is almost as reliable as wired connectivity. The new technologies that 5G brings such as network slicing, AI, real-time machine learning, and edge computing enable the transformation of the manufacturing industry.
To establish networks in enterprise premises, there are three types of networks to choose from; Public, Private, and Hybrid. Public networks involve using networks provided from commercial base stations, whereas private networks provide a dedicated spectrum, can be tailored for different applications, and secure data on the premises. Each type has its advantages and disadvantages. For example, directly using public networks is possibly the cheapest option, however, data security, as well as liability issues in maintenance, may be of concern. Deploying private networks will be the most expensive option, but it allows a company to have full control of its network. For most of the companies involved in manufacturing, especially for those multinational corporations such as Bosch and Siemens, the private network is the most appealing option given the data security concerns. We've also seen that telecommunication regulatory bodies in many countries such as the USA, Germany, China, and Japan have been releasing dedicated spectrum for private network developments. It should be noted that private networks are not unique to 5G. There are already private networks based on 4G. Nevertheless, the characteristics of 5G such as high data throughput and low latency together with the key technologies such as edge computing are key reasons why 5G private networks are so attractive for the industry.
Over the past two years, there has been an increasing number of 5G private network deployments globally. Bosch has announced that they will rollout 5G private networks in all their manufacturing factories. Automotive manufacturers such as Ford and Toyota have both had 5G private networks deployed in some of their factories in 2020. China has been actively deploying 5G private networks for mining sites. It is guaranteed that more and more enterprises will embrace 5G networks.
The growth of 5G small cells will go hand in hand with 5G private networks for industries. As mentioned previously, 5G small cells are essential for 5G private network deployment. IDTechEx expects that small cell shipment numbers will be significantly higher compared to where it is now by the end of 2031. To learn more about 5G small cells, please see IDTechEx's latest report: "5G Small Cells 2021-2031: Technologies, Markets, Forecasts". This report contains a comprehensive analysis of the supply chain across 5G small cells, which includes a detailed assessment of technology innovations and market dynamics. This report also provides comprehensive and detailed case studies on key vertical applications enabled by 5G small cells. Importantly, the report presents an unbiased analysis of primary data gathered via interviews with key players and builds on the IDTechEx expertise in the 5G industry.
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