As global network capital expenditures (capex) slow down, private networks have become a key growth area for the mobile industry. According to research firm SNS Telecom & IT, the private network sector is projected to grow by 20% annually, with total spending expected to reach $6 billion by the end of 2027.

The report highlights that nearly 60% of this investment—around $3.5 billion over the next three years—will be directed towards standalone 5G networks. Standalone 5G is set to become the dominant wireless technology driving digital transformation and factory automation.

This surge in private network adoption could transform the sector into an "almost parallel equipment ecosystem" by the late 2020s. By 2030, private networks may account for up to 20% of all mobile network infrastructure spending.

Drawing from a database of 7,300 private LTE/5G networks across 130 countries, SNS attributes much of this growth to the superior performance of 5G compared to other wireless technologies, particularly in standalone 5G core networks. Although deployed by less than 10% of mobile operators globally, standalone 5G has proven highly effective in the growing private cellular segment, offering significant performance and efficiency gains.

Driving Forces Behind Growth

A key factor in this expansion is spectrum liberalization, with regulators in many countries releasing spectrum for private networks. Notable examples include CBRS in the U.S., the 26GHz band in Spain, the 4.6–4.9GHz and 28GHz bands in Japan, and private service licenses in Brazil.

Private networks have also emerged as a cost-effective alternative to Distributed Antenna Systems (DAS) for delivering neutral-host coverage in enterprise and public venues, according to SNS.

With private 4G and 5G networks now deployed across diverse industries—from factories and mines to power plants and offshore wind farms—significant data on productivity and cost benefits is becoming available. SNS reports that productivity and efficiency gains for manufacturing and logistics processes range from 20% to 90%, with cost savings of up to 40%, along with an 80% improvement in worker safety and accident reduction.

Opportunities for Mobile Operators

The role of mobile operators in this growing market depends on local regulations and the extent to which unlicensed operators and spectrum are allowed. However, telecom companies with established systems integration (SI) businesses, such as NTT Data and Verizon, are well-positioned to capitalize on the market. SNS estimates that these SI units could capture 35% to 40% of the market.

NTT Data counts clients like BMW, Cologne Bonn Airport, Schneider Electric, and the city of Las Vegas among its private wireless customers. Verizon Business provides managed private wireless solutions to U.S. NFL stadiums, Audi’s Neustadt test track, and Southampton Port in the UK.