The business case for 4G/5G private wireless networks has been established across the Industrial Internet of Things (IIoT) markets, evidenced by increased adoption in recent years. Private cellular network operators offer mobile services and technical specifications focused on specific industries and regions, resulting in more tailored network deployments than what you might get with a consumer-focused operator.
Companies that opt for a dedicated private wireless operator know that the network provider possesses specialized expertise in their field. For example, an oil & gas firm can choose a mobile service provider with extensive experience helping clients that manage offshore drilling sites. As another example, mining and agriculture companies can leverage a niche operator’s low-band spectrum to connect expansive, hard-to-reach areas. These benefits make a compelling case for private cellular in industrial digitalization use cases.
Shortcomings of Traditional Mobile Network Operators for Industry
Traditional Mobile Network Operators (MNOs) have historically dominated spectrum auctions, given their importance in consumer connectivity markets. Their primary source of revenue comes from connecting high-throughput consumer devices like smartphones, so many of their business decisions are dictated by consumer preferences and locations. MNOs would not be as inclined to purchase spectrum in the remote areas where industrial companies often operate. Moreover, industrial companies increasingly require unique mobile network performance and communication specifications that MNOs cannot always accommodate.
A more reasonable option for industrial customers can be a private wireless network operator that caters to their specific IIoT/digitalization needs.
Why Private Wireless Networks Are Gaining Traction In Industry
Private wireless network operators center their business models around providing mobile services for niche industrial segments and granting access to the spectrum that those industries require. For example, utility companies in the United States can grab low-band spectrum from New Jersey-based Anterix for their private cellular networks. The 900 Megahertz (MHz) band is a good fit for utilities as they often operate in remote areas and require long-range connectivity and low latencies.
Like most private wireless network operators, Anterix is a clear example of a private network operator with a niche focus—on utilities, in this case. Other operators expand their mobile connectivity approach by targeting multiple markets and/or countries. Citymesh comes to mind, offering a mid-range spectrum for high-throughput industrial use cases in addition to private 4G/5G network use cases in airports and smart cities.
Globalstar is another private wireless network operator that deviates from the norm, even more than Citymesh. Through bold spectrum acquisition efforts, the Louisiana-headquartered operator offers private cellular network services in 11 countries, giving the company a major competitive advantage. Globalstar is emblematic of the trend of private wireless operators positioning their spectrum offerings as just one aspect of a broader, end-to-end network solution. The company's Band n53 spectrum simplifies Internet of Things (IoT) connectivity for industrial firms with a global footprint that typically have to purchase separate spectrum in each country where they do business.
It’s important to note that no other private cellular network operator possesses Globalstar's geographic reach. Indeed, most other dedicated private wireless operators are smaller organizations focused on a specific country or region and tailored to niche industries.
Private Wireless Operators Demonstrate Their Value
If there’s one reason above all why an industrial firm should partner with a smaller, dedicated private wireless network operator for IoT applications, it’s the vertical-specific expertise that many private network operators have amassed over years of experience. Private cellular vendors like Tampnet, Anterix, Ambra, and Citymesh have a System Integrator (SI) background. They understand the pain points, latency and spectrum requirements, and optimal deployment strategies for specific market verticals. Such knowledge is a huge advantage over traditional MNOs that can lack the granular evaluation of an industrial customer’s connectivity and digitalization needs.
To illustrate, Tampnet leverages its experience as a maritime operator in the Gulf of Mexico and the North Sea to provide tailored private 4G/Long Term Evolution (LTE) networks for oil & gas companies in offshore drilling sites. Many of these companies still use Wi-Fi for operations and TETRA for emergency communications. These connectivity services can be consolidated into a single private LTE network, reducing costs and improving uptime. A prominent industrial customer of Tampnet’s includes Ørsted, which has been provided with 4G/LTE coverage for its Hornsea One wind farm in the United Kingdom. Tampnet’s approach to mobile connectivity highlights the inherent difference between private wireless network operators and traditional MNOs. For an MNO that targets densely populated areas and mainly consumer markets, a private 4G/LTE network deployment in a remote region of the ocean is not economically feasible. However, an industry-focused operator like Tampnet serves an essential niche and can maintain profitability.
Anterix also exemplifies the benefits of a vertical-focused mobile operator. Using its extensive knowledge of the utility sector, Anterix’s Falling Conductor Protection (FCP) service de-energizes a broken power line in less than a second as it falls to the ground. As a result, a potential fire can be avoided. The solution was developed in collaboration with Schweitzer Engineering Laboratories (SEL), which leverages Anterix's 900 MHz low-latency private LTE network. Without Anterix’s specialized expertise in the utilities sector, the FCP fire mitigation technology would not be possible.
Does National Spectrum Pose a Threat to Private Wireless?
When it’s time to deploy a private cellular network, companies usually source licensed spectrum from MNOs or national spectrum schemes, such as the Citizen’s Broadband Radio Service (CBRS) in the United States. National spectrum schemes enable industrial firms to acquire spectrum directly from telco regulators.
Countries such as Germany, Japan, and the United States already offer a national spectrum for industries, and others like India are considering it. Several industry experts tell ABI Research that national spectrum schemes will create a roadblock for would-be private network operators. Moreover, industrial companies could easily see a lower-cost spectrum from a country as a more sensible option for private wireless use cases.
Despite the national spectrum’s potential threat to private wireless network operators, other industry voices remain more optimistic. For one thing, they emphasize the shortcomings of some national spectrum, notably the U.S. CBRS spectrum. Due to being locked into mid-range 3.5 GHz frequency bands, some enterprises that require wide-range cellular coverage (e.g., mining and agriculture companies) would not be suitable customers. This is where industry-specific private network operators can step in and offer a low-band spectrum that covers remote industrial sites.
Private wireless network operators can still play a key role, even if a company chooses a national spectrum. Once the national spectrum is acquired from national regulators, a company will still need to apply it correctly. Private wireless network providers possess years of experience in specific industries, enabling them to manage industrial customers’ private 5G/LTE networks optimally.
The Essential Role of Private Wireless Networks in Industrial Excellence
It is difficult for some nationwide carriers to provide the industry-tailored cellular network solutions that private wireless operators like Tampnet and Anterix offer. With a firm foothold in the consumer markets, these nationwide carriers see little incentive to purchase spectrum for small private cellular networks with niche industrial use cases in mind. In line with the recurring theme of this article, this is why private wireless network operators play an essential role in the future of operational excellence for industrial customers.
Download ABI Research’s The Role of Private Network Operators in Industrial IoT Markets report to learn more about how private wireless fits into the industrial digitalization discussion. This content is part of the company’s Industrial & Manufacturing Technologies and IoT Networks & Services coverage areas.
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