On April 18, the State Council Information Office hosted a press conference to discuss the development of industrial informatization in the first quarter of 2025, highlighting pertinent data and policies on 5G evolution. The conference emphasized the "orderly deployment of industrial 5G standalone private networks," marking another push by authorities following last year's National Conference on Industry and Informatization, which proposed "boosting the construction of industrial 5G standalone private networks." As 5G nears its sixth year of commercial use, large industrial enterprises are accelerating their efforts to establish 5G standalone private networks, with the effectiveness of 5G in enabling vertical industries through these networks becoming increasingly evident. However, based on recent global experiences, the author contends that domestic industrial 5G standalone private network construction still encounters various challenges. Amidst the growing industry demand for standalone private networks, it is crucial to consider a multitude of factors.

First, the policy on 5G standalone private network frequencies significantly impacts the entire wireless sector.

Allocating exclusive radio frequencies to industrial enterprises has been a key measure to propel 5G private network development abroad in recent years, with Germany pioneering this approach. Many countries have since followed suit, issuing special frequency application policies. Dedicated frequencies are essential for 5G standalone private network development, but granting these scarce resources to numerous industrial enterprises may lead to frequency fragmentation, given their limited expertise in communication networks. Considering this, China has yet to open applications for 5G dedicated frequencies.

However, 5G dedicated frequencies have seen a breakthrough. In November 2022, the Ministry of Industry and Information Technology issued the first enterprise 5G private network frequency license to Commercial Aircraft Corporation of China, Ltd. (COMAC). This is currently the first known enterprise 5G private network frequency license in China and a milestone in 5G private network development. COMAC's private network frequencies, 5925~6125MHz and 24.75~25.15GHz, are dedicated industrial wireless frequencies.

The 5925~6125MHz band falls within the 6GHz frequency range, a focal point of competition in the wireless sector, particularly between wireless local area networks (WiFi) and International Mobile Telecommunications (IMT) systems. With the introduction of WiFi 6E and WiFi 7, competition for the 6GHz band has intensified, as these technologies aim to expand into the 6GHz band.

Previously, countries held diverse views on the 6GHz (5925-7125 MHz) band, directly influencing the fate of the competition between WiFi 6E, WiFi 7, and 5G. Policies primarily revolved around whether to allow WiFi access to this band as an unlicensed frequency, with three options:

• The entire 6GHz (5925-7125 MHz) as an unlicensed frequency band for WiFi use.
• Part of 6GHz (5925-6425MHz) as an unlicensed frequency band for WiFi use.
• The entire 6GHz (5925-7125 MHz) as a licensed frequency band for cellular networks and other licensed access.

For WiFi players, the first option is ideal, offering 1200MHz of continuous frequency; the second option provides 500MHz, generally meeting current planning needs; the third option is least preferred, as it thwarts WiFi 6E and WiFi 7 expansion into the 6GHz band, significantly reducing commercialization prospects.

Conversely, domestic policies seem more supportive of using 6GHz for mobile communication systems. The "Regulations on the Division of Radio Frequencies of the People's Republic of China" (Order No. 62 of the Ministry of Industry and Information Technology), promulgated in 2023, clearly stipulates that mobile services in the entire or partial 6425~7125MHz band of the 6GHz band are designated for IMT, referring to future 5G/6G systems.

Post-regulation, questions arose regarding Wi-Fi systems' use of the 5925~6425MHz band within the 6GHz range. However, with the allocation of 5925~6125MHz to COMAC, only 6125~6425MHz remains. If classified as an unlicensed band, it could alleviate Wi-Fi's frequency bottleneck; if licensed, Wi-Fi devices would be barred from using the 6GHz band domestically.

Currently, the use of 5925~6125MHz for 5G private networks is a done deal. The formulation of future 5G private network frequency policies will profoundly impact the entire wireless industry.

Second, has the group of overseas suppliers for 5G standalone private networks rapidly expanded in China?

The global 5G private network ecosystem is gradually maturing, particularly in equipment and systems. New players have long been targeting this market. Telecom operators, communication equipment vendors, IT vendors, internet giants, manufacturing giants, Open RAN enterprises, and others harbor high hopes for this sector.

Telecom operators and communication equipment vendors, experts in mobile communication construction and operation, naturally offer 5G private network solutions. Unlike previous generations, internet giants and manufacturing giants have also entered, significantly lowering the threshold for 5G private networks through their vertical industry expertise, cloud computing capabilities, and low-cost equipment.

Siemens, a manufacturing giant, launched a 5G private network product in 2023, a complete system encompassing core network and radio access network components. As prior research noted, Siemens' 5G private network solution runs on its industrial computers, known for its OT-level and SME-friendly features. Siemens believes its solution offers clear advantages over others, suitable for harsh industrial environments, and user-friendly.

Typical internet giants include AWS, Microsoft Azure, Google Cloud, and other cloud computing companies. For instance, AWS introduced AWS Private 5G, a solution for enterprise 5G private networks. This new managed service enables enterprises to easily establish their own 5G private networks. Pre-integration features AWS's radio frequency units of small base stations, servers, core network, and access network software, eliminating the need for customer configuration. Deployment begins once equipment is powered on. Customers primarily manage deployment and configuration through the AWS cloud platform, akin to a DIY model. Enterprises can purchase, deploy, and expand 5G private networks in days, drastically lowering the deployment threshold.

However, China's supplier group in this field is relatively narrow, with telecom operators, communication equipment vendors, and some IT equipment vendors promoting private network construction. Domestic manufacturing enterprises have yet to emerge with groups akin to Siemens offering manufacturing private network services. Previously, Alibaba DAMO Academy and Alibaba Cloud launched a cloud-native-based 5G private network, potentially limited by the lack of 5G standalone private network deployment in China and the absence of large-scale implementations. Other domestic internet and cloud vendors have not introduced similar 5G private network products.

Driven by 5G standalone private network policies and increasing private network licenses, the author believes some vendors will enter the 5G private network systems and operations field. Compared to overseas private network service groups, many non-communication vendors may enter the market. However, the private network market has limited space compared to the public network market, and the number of players that will ultimately remain will not be significant. A process of survival of the fittest will ensue.

Third, will the cost-benefit issue of 5G standalone private networks hinder this field's development?

In 5G's early commercialization years, the domestic industry vociferously called for 5G standalone private network licenses, hoping for swift implementation. However, with 5G virtual private networks' deployment across industries and expanding application scenarios, the industry has gained deeper insights into large-scale 5G applications, and the cost-benefit orientation of 5G applications has become clearer. Consequently, relevant vendors have become more rational, and it is uncertain if large-scale deployment will materialize under policy dividends.

Overseas experiences show that 5G private networks haven't universally received positive feedback, facing developmental challenges. Taking Germany as an example, at a recent consultation meeting of the German Federal Ministry of Transport and Digital Infrastructure, stakeholders from industry, research, associations, and the public sector highlighted obstacles to 5G and 6G application in industrial environments. They cited lack of expertise, 5G equipment and chip shortages, and economic uncertainty as hindrances. Most participants stated that current 5G demand in vertical applications falls short of expectations. As of March this year, only 462 frequency allocations for dedicated networks had been made. Some stakeholders noted that many companies' value creation processes currently do not require 5G's technical capabilities.

For industrial enterprises, 5G standalone private networks represent a substantial investment. Leading enterprises with ample budgets and rich scenarios may opt to deploy their own controllable standalone private networks but need to evaluate return on investment post-deployment. As an enterprise informatization infrastructure, 5G standalone private networks support diverse scenarios. For instance, based on its 5G standalone private network, COMAC has developed products like COMAC Brain, Industrial Metaverse, Tianshu, Tianti, Tianjing, and Tianyan, offering enterprises comprehensive, replicable industrial digitization solutions such as data collection, flexible execution, smart inspection, and visual control. It has also established COMAC Intelligent Technology Co., Ltd., further empowering the industry. While such enabling contributions cannot be quantified, they enhance overall enterprise development. The indirect driving effect's magnitude significantly impacts the speed and scale of 5G standalone private network deployment.

Fourth, the relationship between 5G standalone private networks and operators' 5G virtual private networks based on the public network.

Latest data indicates that 5G applications have been integrated into 80 out of 97 major categories of China's national economy, with over 138,000 cases. There are over 18,500 "5G + Industrial Internet" construction projects nationwide, and 700 high-level 5G factories have been selected. These applications are primarily facilitated through 5G virtual private networks.

Concerning 5G standalone private networks, many practitioners fear this model will impact telecom operators. Short-term, the number of industrial enterprises capable of deploying 5G private networks is limited, thus minimally affecting 5G virtual private networks. However, medium to long-term, as private network solutions mature and lightweight, low-cost systems emerge, more small and medium-sized industrial enterprises can adopt 5G standalone private networks, significantly impacting operators, especially those relying on private networks to promote ICT solutions like cloud services, artificial intelligence, and big data in the industry. This will compel operators to innovate, increase 5G standalone private network supply, and provide comprehensive ICT solutions.

In the author's view, while 5G standalone private networks may partially replace virtual private networks in the future, their complementarity is more evident in broader application scenarios. Relying on operators' ubiquitous network infrastructure, virtual private networks ensure enterprises can access the network anytime, anywhere, with faster deployment speeds. For example, in May 2022, Contemporary Amperex Technology Co. Limited (CATL) deployed China's largest 5G private network, spanning 40 factory areas in 8 cities across 6 provinces, totaling nearly 5 million square meters. If similar enterprises have numerous factories widely distributed across the country and deploy their own 5G standalone private networks, they'd need to deploy multiple networks and purchase extensive equipment and platforms. In such cases, a combination of standalone and virtual private networks may be more suitable.

The author has kept a close eye on Siemens' 5G private network solution. Beyond offering a comprehensive system and solution for standalone private networks, Siemens also collaborates with telecommunications operators to facilitate the resale of 5G network slicing, establishing a B2B2B business model that enhances the adoption of virtual private networks.

Certainly, while the deployment of 5G standalone private networks encounters numerous hurdles, the policy landscape for such networks is progressively becoming more permissive. As a result, 5G standalone private networks are edging closer to reality. By 2025, several industrial 5G standalone private networks are expected to be operational, further diversifying the instances of 5G's empowerment of the real economy.