Rapid 5G private network growth in Asia Pacific offers significant opportunity potential

Asia Pacific’s strong manufacturing base, as well as government initiatives and private investment throughout the region, are set to drive the deployment of 5G private networks, making it the fastest-growing market for 5G private networks globally. It offers opportunity for the entire networking and services ecosystem.

While private networks have been possible in previous generations of networks, 5G Standalone (SA) is rapidly gaining ground as the technology that’s driving a next generation of private networks today.

While North America is leading the way in terms of market size and deployments, the Asia-Pacific region is touted by many analysts as the fastest-growing market and is set to become a significant player on the global platform in terms of private network deployments and market size.

Asia Pacific represents the fastest-growing market for 5G private network deployments

According to Grand View Research, for example, the Asia-Pacific private 5G network market generated revenue of $587.6 million in 2023, accounting for over 29% of global revenue^[1]. However, it predicts that the region’s market for private networks will grow at a whopping CAGR of 53.9% between 2024 and 2030 to reach $12.01 billion by 2030 – nearly doubling over the next 5-6 years.

By 2030, Asia Pacific will account for just over one-third of global revenue – the total global market is forecast to grow at a CAGR of 54.1% over the forecast period to reach $36.08 billion. Analysts at Kearney offer a similar viewpoint, forecasting a CAGR of 83% for 5G private networks in the region between 2022 and 2028, albeit from a smaller base ($0.1 billion in 2022 to $14.3 billion by 2030)^[2].

Kearney predicts that by the end of the forecast period, 5G private networks will account for 10% of the entire enterprise connectivity market in the region.

The speed of the region’s growth is expected to be driven by its huge manufacturing base, with the construction of automated factories and ports throughout the region accelerating. The GSMA estimates that just 1% of factories globally were "smart," meaning that there are huge opportunities for operators, network equipment vendors, system integrators, cloud providers, tower companies, managed service providers and other specialists, as well as startups^[3].

The region’s strong manufacturing base and its drive towards digitization will lead demand

Tellingly, the manufacturing sector dominated the market in 2023, due to the growing need for unified connectivity combined with low latency performance in the manufacturing sector. But 5G private networks are also being deployed apace across multiple verticals, including transportation, healthcare, maritime, military, mining, and utilities, throughout the region – many of which also share low latency performance requirements.

China is expected to register the highest CAGR from 2024 to 2030 (although no figures are provided). However, countries such as Australia, India, Indonesia, Japan, South Korea, Singapore, Thailand, and Vietnam are all accelerating their 5G private network initiatives and investment as the region embraces digital transformation.

Many countries in the region are also backed by government support, some of which have outlined plans to integrate digital technologies and services into every sector of the economy. In some countries, governments have also made spectrum available so that enterprises can build their own private networks.

For example, in Japan local governments can allocate spectrum to non-mobile operators, while others have started shared spectrum initiatives to lower the entry barriers for new entrants. Both South Korea and Malaysia, meanwhile, have allocated dedicated spectrum for enterprise use since 2021. Efficient spectrum management will be key to success.

5G private network opportunities grow in Asia Pacific

The same report from Kearney outlines a number of recent 5G private network projects in the region, including Hutchison Ports, which is achieving latency of less than 15ms at an autonomous container truck depot in Laem Chabang Port, Thailand; a Hyundai smart factory in Singapore that supports fully autonomous operations; and, Somboon Advanced Technology, a Thai auto parts manufacturer, which is using a 5G private network to achieve latency of less than 20ms.

Put simply, the Asia-Pacific region offers significant opportunities for the 5G private network ecosystem. It’s set to be the fastest growing market and its accelerating digitization and significant manufacturing base mean that 5G private networks will be important drivers for the region’s economy.

Pamir has decades of experience helping U.S. companies enter markets throughout the region, optimizing opportunity while minimizing risk. We provide a comprehensive risk assessment based on a unique blend of quantitative and qualitative research, as well as thought-leadership presence on the ground in the region.

To find out more contact us today.

^[1] https://www.grandviewresearch.com/horizon/outlook/private-5g-network-market/asia-pacific

^[2] https://www.kearney.com/industry/communications/article/5g-private-networks-the-new-growth-engine-for-asia-pacific-telcos-in-the-enterprise-market

^[3] https://www.gsma.com/about-us/regions/asia-pacific/wp-content/uploads/2023/02/270223-Private-networks-in-Asia-Pacific-v3.pdf