The private 5G market remains an untapped multi-billion-dollar opportunity just out of reach due to significant but surmountable challenges, according to a recent report from Technology Business Research (TBR), but the government and Apple are set to drive the initial push.

Chris Antlitz, principal analyst for the telecom practice at TBR, said during a webinar presentation that spending on private networks topped just over $4 billion last year, but that it’s set to nearly double by the end of 2027. That spend will initially be focused on already established 4G LTE technology, with 5G gear starting to take a majority share beginning in 2026.

“This is a good market [that is] growing,” Antlitz said. “This is something that operators are interested in because it's growing. This is also a market area that many vendors are interested in, either through direct sales to enterprise or through channel sales ultimately to a non-CSP [communication service provider] customers.”

A lot of that initial growth is expected to come directly from government entities looking to take advantage of inherent security components of cellular technology or by way of government subsidies tied to de-globalization efforts.

That first has been highlighted by a growing number of private network defense contracts targeted at connecting military bases. This includes a recent deal from Hughes Network Systems to power a private network at a Washington naval air base.

Antlitz saidthat the second is being impacted by growing geopolitical concerns and economies exiting the pandemic.

“What we see is new factories being built in countries that maybe weren't big on manufacturing or that are bringing manufacturing back after outsourcing the majority of those functions. This is very much driven by national security considerations, for example in the case of semiconductor manufacturing,” Antlitz said. “This is also driven by supply chain resiliency and localizing supply chains. This is very much driven by the COVID debacle where supply chains took a big hit and that caused enterprises and businesses of all sizes to do a reassessment of their supply chains and make decisions accordingly to reduce risk.”

Antlitz also expects visual intelligence, or computer vision, to be a driver for private 5G deployments. He specifically cited Apple’s unveiling this year of its Vision Pro device as an inflection point in the market.

“I do believe that the headset that Apple's coming out with is going to be a game changer,” Antlitz said. While acknowledging the current debate over the near-term market viability, Antlitz has pie-in-the-sky expectations for the device and its impact on the private 5G market.

“There's a lot of debate in the industry right now about do people really need that device. Is there a use case for it that is going to make that device a must have,” Antlitz said. “The initial feedback we've gotten about the device from people who have demoed the prototypes is that it was overwhelmingly positive feedback. I like to think of that as a moment in time where it'll be viewed as a watershed moment. If we look back in history when the smartphone became a big thing after the first iPhone, I think we're going to see a similar event take place where we see an initial device that changes the paradigm for how that device can be interacted with, and the productivity that could be gained from a device like that, a platform like that, and how consumers and enterprises may use a device type like that.”

Telecom operators are currently viewed as best-positioned to take advantage of the private 5G market opportunity due to their control over licensed spectrum, but Antlitz said they can’t rest on that perceived advantage.

“The reality is that operators don't have a monopoly on spectrum, at least not anymore,” Antlitz said. “There is licensed spectrum, there's unlicensed spectrum in various bands, there’s shared spectrum like CBRS [Citizen Broadband Radio Spectrum], there is a broad range of frequency bands that are available.”

This allows other players in the space to come to market with robust private 5G platforms that provide enterprises with more choice in where they invest.

“What I would advise is whoever you're working with, if you're a business that's interested in private networks, working with either a consultancy or a systems integrator or even the OEM themselves or a service provider, it’s getting a good understanding of the different options that are available and the pros and cons of that,” he said.