On January 5, 2024, the China Academy of Information and Communications Technology released the White Paper on China's 5G Development and Economic and Social Impact, which summarized the 5G commercial development data and economic and social impact in 2023 in China, and put forward suggestions for large-scale innovation and development. According to statistics from the Ministry of Industry and Information Technology, the total number of 5G base stations in China will reach 3.282 million by November 2023.

5G technology not only improves the consumer Internet experience and the digital level of life, but also brings great innovation power and upgrade support to the industrial Internet.

5G Private Network is one of the technical branches of 5G Local Area Network (5G LAN), which provides enterprises in the target industry with unified connectivity, optimized services and a dedicated 5G network system for secure communication in a specific area. The advantages are stronger task carrying capacity, higher cost performance, higher broadband/lower latency differentiated mobile networks, and personalized security customization and dynamic exclusive resources. At the same time, the advantages of 5G in network slicing can better guarantee the quality of service and integrate with the factory digital system.

Industry private network is an important networking mode in the 5G toB market, and there are three mainstream deployments at present:

A virtual private network (fully shared) provides a wide range of services and flexible deployment based on the flexible slice of the public network, and applies to the scenario where the wide area enterprise service or the information security requirement is low.

Hybrid private network (partial sharing) to achieve local data uninstallation and function customization optimization, applicable to the local open, security isolation needs moderate, high cost control scenarios.

The independent private network (independent deployment) is customized according to the needs of industry enterprises, applicable to the local area closure, network security and reliability requirements are very high, and the performance is far higher than the cost concern scenario.

In complexity, the industrial Internet far exceeds the consumer Internet. The first is the large base of industry categories, and the operation/information models of various industries are very different, and the enterprises have their own diversified work scenarios. In response to such a massive and complex demand, several sets of simple standardized hardware and software are just a drop in the bucket, and imitating consumer Internet traffic is more opposite. At the same time, the digital transformation of industrial enterprises first needs to reconstruct the top-level design, update the organizational structure and business process, and complete the scene customization and technology selection, resulting in the cultivation cycle of the toB market far beyond the consumer market. In particular, mining, oilfield, power grid, chemical industry and other industries have high risk factor, high labor cost, low production efficiency, high cost of public network coverage and cannot be digitally upgraded. Therefore, simply reusing consumer Internet solutions will not achieve the goal.

Compared with 5G public networks, 5G private networks provide industry customers with exclusive services, a higher level of stability/privacy/security protection, significantly improve broadband and optimize deployment cycles. At the same time, since the commercial launch of 5G in 2019, many vertical industry projects have found that basic 5G technology has shortcomings in performance/scenario fit. To solve these problems, 5G-Advanced (referred to as 5G-A) technology came into being.

At the level of large bandwidth and high data capacity, 5G-A can realize unmanned or reduced personnel of smart mines/mines. The number of front-end sensing devices deployed in the actual work scene has increased significantly, the number of cameras requires enhanced network uplink capability, RedCap realizes the acquisition and return of a large number of high-definition images in the mine, and the new mine safety base station is small in size, meets the requirements of the specification, and is very convenient to install, which helps 5G-A to be used in the coal mine scene.

At the level of mass sensing terminal access, in the power grid, chemical and other industries, 5G-A equipment terminals using RedCap technology save high costs such as trench digging/cable laying required by traditional wired cameras (there are strict requirements for construction in many specific industry parks, Need to complete complex compliance approval procedures) can achieve remote equipment monitoring, production area security monitoring, unmanned warehousing logistics, personnel/equipment positioning and other application scenarios.

At the level of mission critical requirements, there are many bus standards such as factory network data mining/industrial control, many on-site network layers, many cables, many faults, and fault troubleshooting is difficult. Once the failure causes the production line to stall, the loss of hundreds of thousands to millions of dollars per minute. The network construction period is long and the cost is high. After replacing the wired network with 5G-A wireless, the failure rate is greatly reduced, and the capacity value is significantly increased every year. The efficiency of introducing new production lines has also been significantly improved.

The application of 5G-A private network technology not only helps remote control, real-time monitoring, intelligent analysis, etc., but also meets the needs of information isolation security. At the same time, new applications such as Open RAN will continue to lead the 5G-A technology optimization process to meet the high requirements for low-latency critical performance in the medical industry.

The combination of 5G-A private network and public network can also expand industry business and help enterprises cultivate cross-regional differentiated business capabilities, and this kind of convergence scenario has also become a research hotspot. At the same time, combined with a variety of emerging technologies, such as network diversion/slicing technology, Mobile Edge Computing (MEC)/encryption technology, 5G-A private network and various industries continue to deepen the integration. 5G-A private network promotes the accelerated evolution of the industrial system to digitalization/intelligence, and brings great changes to the industry ecology.

The 5G-A private network industry chain includes hardware and software suppliers, solution providers and downstream industry customers. In addition to the aforementioned entities, 5G Open RAN and public cloud vendors have also entered the game.

In recent years, driven by national policies and industry development, the development of China's 5G private network has accelerated under the joint efforts of the above multi-party forces. With the continuous progress and integration of technology, the deployment scope continues to expand, and the network capacity continues to strengthen, 5G private networks have urgent needs in energy and power, government, medical care, connected cars, and other industries, while the industrial manufacturing industry is huge, so these industries have a high market attention. It is predicted that 80% of China's 5G application scenarios in the next five years will be in the industrial Internet field, and the 5G industry private network market will reach CNY96 billion yuan in 2026, with a compound annual growth rate of more than 16%.