LG Electronics Inc.'s push to expand its presence in the burgeoning private 5G network market is poised to gain traction.
The South Korean electronics giant announced on Sunday that it will build its private 5G network at Seoul Station and the Korail Siheung Train Depot in Gyeonggi province to spearhead digital transformation at the facilities, with real-time monitoring of the facilities and locomotives and a digital twin technology.
It also vowed to discover new business models using the local 5G network services.
The announcement comes after the company signed an MOU with Korea’s state-owned railway operator Korea Railway Corp. (Korail) on Friday to build the e-Um 5G network to innovate the national railway system.
E-Um 5G is a private 5G network that can be customized for different locations based on specific needs. It is a business-exclusive network service using 5G that can be accessed only through a business or organization’s devices or terminals.
PRIVATE 5G NETWORK MARKET SET TO BURGEON
Private 5G network service boasts ultra-high speed, ultra-low latency and highly reliable connectivity — key to the operations of smart factories, robot-driven logistics and hospitality services, and other industrial automation systems.
LG Electronics CEO Cho Joo-wan (at left) and Korail CEO Han Moon-hee pose for a photo after signing an MOU on Nov. 8, 2024 (Courtesy of LG Electronics) Its global demand is set to take off in line with the development of future technologies including AI, big data, cloud, autonomous driving and augmented reality.
The global 5G private network market is forecast to grow to $11.8 billion in 2028 from $2 billion in 2023 at an annual growth rate of over 40%, according to market research firm MarketsandMarkets.
LG Electronics has been accelerating its push to win the private 5G network race on expectations that the private 5G business will create huge synergy with its other business-to-business (B2B) services and products such as automated mobile robots and automated guided vehicles, used mainly in smart factories, logistics centers and hospitals.
The Korean company said it has successfully tested its 5G private network services at various sites in Korea, including a smart factory in North Chungcheong province, a logistics center in Incheon and a university hospital in Seoul. It has also tested it at its smart factory in the US state of Tennessee.
It owns some 30,000 patents in related technology, according to the company.
The company earned 84.2 billion won in consolidated sales in 2023.
LG Electronics operates an array of B2B operations, including automotive electronics, heating, ventilation and air conditioning (HVAC) systems, built-in appliances, smart factory solutions, commercial displays and mobility solutions.
Of its four business units, Business Solutions is responsible for digital signage, commercial TVs, robots, electric vehicle chargers and information technology devices such as laptops and monitors.
G CLOi's CarryBot inside a logistics center (Courtesy of Yonhap) It has also joined the race to win the chiller market, which is growing rapidly thanks to increasing demand for AI data centers.
The company set a goal of raising sales from the chiller business to 1 trillion won by 2027.
It inked a 100 billion won deal in the second quarter to provide cooling machinery for a data center in North America.
Its accelerated foray into the private 5G network market is expected to help the company offer more products and services in the B2B sector to smart factories, logistics centers and data centers as a turnkey solution.
“LG Electronics’ B2B business is not limited to single product supply,” said CEO Cho. “The company plans to pursue sustainable growth of its high-value-added business that offers the customer an all-in-one service with diverse products for a special space.”
Write to Jeong-Soo Hwang at hjs@hankyung.com Sookyung Seo edited this article.
