Factbox: German industrial giants eye regional 5G licenses

A 5G sign is seen during the Mobile World Congress in Barcelona, Spain February 28, 2018. REUTERS/Yves Herman

BERLIN/FRANKFURT/MUNICH (Reuters) - Top German industrial companies are looking to acquire regional licenses to run 5G mobile networks, as they plan futuristic networked factories that could help Europe’s largest economy keep its export edge in the digital era.

The federal network regulator, the BNetzA, will offer regional licenses on relatively easy terms for spectrum in the 3.8 Gigahertz and 26 Gigahertz range. This is suited, for example, to building dedicated networks for industrial complexes and research campuses that German companies are developing under the Industrie 4.0 initiative, the current trend of automation in manufacturing technology.

5G offers data-transmission speeds up to 100 times faster than existing 4G LTE networks, as well as ultra-low latency - or reaction times. It’s also superior to existing local networks that run on Wifi.

The allocation of regional licenses will run alongside what is expected to be a competitive nationwide 5G license auction that could see the entry of a fourth operator in the form of 1&1 Drillisch, a unit of United Internet. Submissions are due on Friday.

“We can’t wait for the network operators to be ready - we are in the midst of Industrie 4.0,” said a spokesman for Siemens, the industrial conglomerate based in Munich.

Here is an overview of companies that say they plan to apply for a regional 5G license:

VOLKSWAGEN VOWG_p.DE - the world's largest carmaker by volume is planning to apply for 5G spectrum so that it can run networks "inside the factory fence". Volkswagen's premium car unit Audi is already working with Swedish network equipment supplier Ericsson to test a 5G laboratory that is exploring networked, digital production methods.

BASF - the German chemicals giant will apply for a local 5G license as part of its drive to digitalize production. The company has 600,000 networked sensors and other devices at its main production facility in Ludwigshafen on the Rhine, a figure the company says could easily rise tenfold. “That’s why we need 5G,” said a spokeswoman. In addition, staff are being issued with tablets and virtual-reality goggles to guide them on maintenance jobs - another use that works better with 5G.

SIEMENS - the industrial conglomerate says it is interested in acquiring regional 5G licenses, for example for its Siemennstadt production facility in Berlin or its plant in Erlangen. 5G is vital to make it possible for the machinery and equipment to communicate directly. Here Siemens offers a platform called Mindsphere that can manage and analyze industrial processes and propose ways to improve efficiency.

Reporting by Jan Schwartz, Ilona Wissenbach, Alexander Hübner, Ludwig Burger and Oliver Hirt; Compiled by Nadine Schimroszik and Douglas Busvine; Editing by Susan Fenton