What is a private network and why should companies get one?

In Finland, first private networks based on LTE technology are already in use and in the near future hundreds more will emerge globally. According to analysists, around 15 million similar networks will be completed worldwide by 2023*. The value of the private network markets is predicted to exceed EUR 17.5 billion by 2026. The networks will be most beneficial to e.g. large industrial sites, mines, logistics centers and hospital campuses.

What exactly makes private networks attractive?

To find out, we talked to Etteplan’s Technology Director Jaakko Ala-Paavola who works closely with several customer cases.

“A private network is an attractive alternative for companies that expect high performance, security and flexibility from their network. The need for this type of solution is increasing as performance-critical applications move into the network edge environment. In many cases, a private mobile network offers major benefits and new opportunities for a company’s business,” says Ala-Paavola.

What does a private network enable?

“The connectivity offered by a private network genuinely enables new things; it’s not just some new network technology added onto existing ones. It makes it possible to, for example, up the effectiveness of your processes and increase productivity, and enables autonomous vehicles, condition monitoring and predictive maintenance, better safety and entirely novel applications and services.”

What does a private network actually mean?

Private LTE networks utilize the same technology as ordinary mobile phone networks run by public operators. A key difference is that the private network infrastructure is located entirely on-site in the company’s own operating environment and is controlled by the company. The core of the mobile network is not behind the public internet or a public mobile phone network operator’s trunk network.

Does this matter?

“Yes, it matters a lot. A local breakout is located at the core of the network, from where the company extracts the data from the network. The location has a decisive impact on data transfer latency. In a private network the breakout point is located at local network infrastructure, resulting in low latency and allowing the data to be immediately processed locally. In a public network, the breakout point is inevitably located somewhere further away, which makes delays longer,” Ala-Paavola points out.

Why is latency such an important factor and a major strength of private networks?

“In industrial applications, latency and reliability are key. If you think about, for example, self-driving mining machinery or other autonomous devices, it is easy to understand how crucial it is to do away with latency, getting it as close to zero as possible. Clearly the best way to do this is through a private network. A local network is also extremely reliable and is not susceptible to external disturbances,” says Ala-Paavola.

Etteplan has carried out extensive testing on latency and the results are eye opening. In private networks delays last no more than tens of milliseconds using LTE technology and with 5G they fall below ten. In a public network with cloud application, round-trip latency can easily be 200 milliseconds, which is far too much in many use cases.

Three benefits of private networks: availability, reliability and security

What are the key factors that impact the acquisition of a private network?

“The three benefits of private networks are availability, reliability and security. For example, in mines under the bedrock, the public network is not available, and the piles of containers in ports are a challenging environment in terms of coverage,” says Jaakko Ala-Paavola.

Reliability is created by the private network’s high performance and low latency. Private networks carry nothing but their own data and are not affected by disturbances in the public networks. If solutions require plenty of measurements and data transfer, such as video streams, robots, drones and work machines, high-level and predictable performance is necessary.

“In order to tackle security risks and narrow the attack surface, a private network is a great choice in a critical infrastructure. Security is extremely strong and the SIM-based access control in use is itself a major benefit, further simplifying the solution,” says Jaakko Ala-Paavola.

Easy ecosystem network for partners

A private network can also easily be made into a shared ecosystem network, meaning that it can be opened to partners in the same geographical area. The system and security are easy to manage precisely through strong access control and network slicing. In a Wi-Fi network, this would be difficult to implement.

Often the rollout of a private network is preceded by a situation in which there has been an attempt to solve networking and data transfer using Wi-Fi. Problems crop up immediately if an object producing data moves and the connection to the base station is lost. Objects can be for example, a work machine, forklift, truck, container, crane or medical device. Unlike with Wi-Fi, the smooth handover from one base station to another is a fundamental property of the network, which means that mobility is not a problem.

What does Etteplan provide in the area of private networks?

“Our special expertise is related to integration, i.e. we combine the processes of the physical world with business processes and design new products and software for the purpose. Integration enables innovation, also when it comes to private networks. Adding new connectivity or attaching a modem to an excavator alone do not bring any value. The benefit is created only once the data from the machine is linked to business-critical systems. Etteplan has significant experience in creating these connections,” Jaakko Ala-Paavola explains.

Read more: 5 things you need to know about private networks right now