U.S. Private LTE & 5G Network Market Size, Share & Trends Analysis Report By Component (Hardware, Software, Services), By Frequency, By Spectrum, By Vertical, And Segment Forecasts, 2020 - 2027

Report Overview

The U.S. private LTE & 5G network market size was valued at USD 1.35 billion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 17.0% from 2020 to 2027. The key drivers attributed to the market expansion include increased adoption of private LTE and 5G networks for the Internet of Things (IoT) and smart city applications. The gradual increase in the number of IoT applications in energy, manufacturing, public safety, and transportation has driven businesses and organizations toward deploying a private network infrastructure. Additionally, the demand for private networks from use cases such as Automated Guided Vehicles (AGV), collaborative robots/ cloud-robots, industrial sensors, and heavy machinery automation, among others is driving the market growth.

The rapidly building smart cities in the U.S. have surged IoT devices' deployment for several applications, including transport, public safety, security, energy management, and so on. Therefore, the demand for private networks in the U.S. is expected to increase from the businesses that are highly utilizing the IoT ecosystem.

The private LTE and 5G networks can be operated on three frequency spectrum categories, including licensed, unlicensed, and shared spectrum. Initially, two types of frequency spectrums were used for private LTE and 5G networks in the U.S. These spectrums encompass the unlicensed spectrum at 5 GHz (MulteFire) and 3.5 GHz spectrum in the Citizens Broadband Radio Service (CBRS) band. The CBRS bands in the U.S. occupy 150MHz of the shared spectrum in the C-band. However, the Federal Communications Commission (FCC) of the U.S. has released spectrum bands for 5G at several frequency ranges, including high band, mid-band, low band, and unlicensed. As such, the positive response from the government and regulatory authorities is anticipated to boost the private 5G market in the U.S. over the forecast period.

The private networking infrastructure provides complete control over the network and allows customers to modify it as per their specific requirements and the priority of operations. With the introduction of industry 4.0., the industrial players are actively focused on deploying the high-speed network to deliver uninterrupted connectivity for several industrial applications, including machine connectivity (M2M), AGV, collaborative robots, and ultra-high-speed (UHD) wireless camera, among others. The manufacturing, energy, and utility sectors are witnessing high adoption of the Industrial Internet of Things (IIoT), which is also an integral part of Industry 4.0 revolutions. The companies from such sectors are heavily adopting private networks to provide unified and secure connectivity for these mission-critical applications.

Most of the unlicensed and shared spectrum bands used for private LTE connections are suitable for 5G deployment. As a result, several telecom providers are already deploying 5G network infrastructure across major metropolitan cities such as Las Vegas, Los Angeles, Miami, and New York City. The private 5G network provides enhanced data capacity and extremely low latency connectivity compared to the private LTE network. Such benefits of the 5G network allow customers to deploy standalone infrastructure for integrating multi-cloud platforms on a centralized high-speed network in the office and facility locations. The robust deployment of the IIoT, coupled with a growing need for ultra-high and secured bandwidth connectivity, is anticipated to bolster the deployment of private 5G networks during the forecast period.

Numerous companies in automotive, manufacturing, and logistics, among others, are increasingly setting up private LTE networks in the U.S. However, the adoption from small- and medium-scale businesses is still very low. The companies in low-income markets and outskirts areas face challenges, such as financial budget and alternative networks' availability, in adopting private networks. Many small- and medium-sized companies from the U.S. cannot meet the massive capital investments required to build a reliable private connectivity infrastructure, which in turn is anticipated to be a challenging factor for the steady growth of the market.

Component Insights

The hardware segment led the market and accounted for more than 50% of the revenue share in 2019. This high share is attributable to the growing deployment of the core network, backhaul, and transport equipment for private LTE as well as 5G networks. The hardware segment is further bifurcated into three component categories, including Radio Access Network (RAN), core network, and backhaul and transports. The need for improved connectivity to connect a large chain of sensors at industrial premises is anticipated to boost RAN equipment adoption and installation.

The services segment is expected to expand at a high CAGR from 2020 to 2027 on account of the emerging need for 5G deployment and integration. This segment is categorized based on installation and integration, data services, and support and maintenance. The installation and integration segment held a high market share in 2019 on account of the high demand for consulting, infrastructure integration, and application integration services. The market is expected to flourish owing to the partnerships between system integrators, cloud service providers, application/ software developers, and equipment vendors to deploy and integrate complete private virtualized RAN (vRAN/C-RAN) and core network infrastructure at the customer premises.

Frequency Insights

The sub-6 GHz segment led the market in 2019 with a revenue share of more than 95%. The sub-6 GHz frequency encompasses low band, and a mid-band of spectrum ranges mainly 6 GHz and below. The Federal Communication Commission (FCC) and MultiFire have released frequencies bands such as 3.5 GHz and 5 GHz respectively, for private LTE and 5G services in the U.S. The significant focus by the federal government to release sub-GHz frequencies has contributed to the high market share of the segment.

The mmWave frequency segment is expected to register a high CAGR over the forecast period. mmWave frequencies are high band frequencies that provide significantly high connectivity with very low latency. These frequency bands are highly beneficial for public safety and industrial infrastructure connectivity applications that require highly reliable networks. Additionally, the FCC has released several mmWave frequencies, including 24.25–24.45 GHz, 24.75–25.25 GHz, 38.6-40 GHz, and 47.2-48.2 GHz, among others for 5G use cases. Thus, the high focus to release mmWave frequencies for mission-critical applications is expected to boost the growth of the mmWave segment over the forecast period.

Spectrum Insights

The unlicensed/ shared spectrum segment dominated the market with a revenue share of more than 90% in 2019 and is expected to remain dominant over the forecast period. The high market share is attributed to the significant focus to release unlicensed and shared spectrums by FCC and MultiFire Alliance bodies for the private LTE and 5G use cases. Additionally, with the affordable costs and open access benefits, the unlicensed spectrum bandwidth is easily accessible and highly preferred during massive machine-type communications (mMTC).

The licensed spectrum for private LTE and 5G network services involves higher costs than the unlicensed/ shared spectrum. Customers need to purchase and procure a license for a particular spectrum bandwidth for delivering enhanced and secured wireless connectivity for its private use cases. Also, access to a licensed spectrum can be achieved from Communication Service Providers (CSP) and direct bidding through the federal government auctions. The demand for licensed spectrums is expected to significantly grow from industrial, government and defense sectors that require highly secured connectivity.

Vertical Insights

The manufacturing segment held the largest market share of around 20% in 2019 and is expected to continue leading over the forecast period. The high market share is attributable to the growing demand for private network infrastructure across various factories/manufacturing facilities in the U.S. market to improve their overall productivity and operational efficiency. The deployment of private LTE and 5G networks primarily caters to the need of high-speed bandwidth for critical use cases, including UHD wireless camera, AGV, collaborative/cloud robots, machine to machine communications, process monitoring, and predictive maintenance, among others. Furthermore, the AGV applications in the industries are expected to portray a remarkable demand for private LTE and 5G networks.

The manufacturing segment is further bifurcated into automotive, electrical and electronics, food and beverages, pharmaceuticals, heavy machinery, and clothing and accessories. On the other hand, the transportation and logistics segment also held a high market share. It is further categorized based on warehouses, vehicle to everything (V2X) connectivity, ports, airports, and rail. The market growth in the transportation and logistics sector is attributable to the accelerating demand for secured and improved network connectivity for warehouse robots, autonomous forklifts, and private connectivity in airports and railway stations.

Key Companies & Market Share Insights

The top 5 companies hold more than 80% of the market share. The key players are strategically building partnerships with industrial manufacturers to establish a private 5G network-based test center to test several industrial automated devices on a private network. Additionally, the companies are engaged in regional expansions and technology collaborations to gain a competitive advantage. For instance, In June 2020, Nokia Corporation and AT&T announced the collaboration for co-creating the RAN Intelligent Controller software platform based on O-RAN architecture. The companies ran a limited live trial of RIC over the latter company’s 5G mmWave network in New York City. Further, In February 2019, Cisco Systems, Inc., and Telenor Group announced to extend their partnership for collaborating over cloud, cybersecurity, digital workspace, and open vRAN solutions for 5G. Some of the prominent players in the U.S. private LTE & 5G network market include:

• Altiostar

• AT&T INC.

• Broadcom Inc.

• Cisco Systems, Inc.

• Mavenir

• Nokia Corporation

• Samsung Electronics Co., Ltd.

• Telefonaktiebolaget LM Ericsson

• T-Mobile USA, INC

• Verizon Communications

U.S. Private LTE & 5G Network Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth for the U.S. and provides an analysis of the latest industry trends in each of the sub-segments from 2019 to 2027. For the purpose of this study, Grand View Research has segmented the U.S. private LTE & 5G network market report based on component, frequency, spectrum, and vertical:

• Component Outlook (Revenue, USD Million, 2019 - 2027)

  • Hardware

    • Radio Access Network (RAN)

    • Core Network

    • Backhaul & Transport

  • Software

  • Services

    • Installation & Integration

    • Data Services

    • Support & Maintenance

• Frequency Outlook (Revenue, USD Million, 2019 - 2027)

• Sub-6 GHz

• mmWave

• Spectrum Outlook (Revenue, USD Million, 2019 - 2027)

  • Licensed

  • Unlicensed/Shared

• Vertical Outlook (Revenue, USD Million, 2019 - 2027)

  • Manufacturing

    • Automotive

    • Electrical & Electronics

    • Food & Beverages

    • Pharmaceuticals

    • Heavy Machinery

    • Clothing & Accessories

  • Transportation & Logistics

    • Warehouses

    • Vehicle to Everything (V2X) Connectivity

    • Ports

    • Airports

    • Rail

  • Energy & Utilities

  • Defense

  • Public Safety

  • Enterprises & Campus

  • Public Venues

  • Mining

  • Healthcare/Hospitals

  • Oil & Gas

  • Retail

  • Agriculture

  • Smart Cities

  • Others