Siemens and O2 Telefonica Partner to Deploy 5G Slices for German Utilities

The Siemens and O2 Telefonica partnership represents a novel approach to industrial 5G deployment. Rather than building dedicated private networks, which would be impractical for widely distributed utility infrastructure, the partners have developed a solution that leverages the public 5G network with dedicated slices for industrial use.

Siemens will maintain the primary customer relationship, integrating O2 Telefonica's network slicing capabilities with their industrial automation solutions. This arrangement allows water utilities to deal with a single vendor while still benefiting from carrier-grade 5G connectivity. Implementation begins with a pilot customer in North Rhine-Westphalia, with plans to expand throughout Germany by year-end.

The joint solution combines Siemens' industrial 5G routers with optimized slices of O2 Telefonica's 5G Standalone network. These slices are regionally defined and customized for the specific requirements of water utility applications, with parameters optimized for reliability rather than peak speeds.

A key security feature is the complete separation of utility data traffic from the public internet, creating an isolated virtual private network over the public 5G infrastructure. This architecture ensures compliance with critical infrastructure security regulations while avoiding the cost and complexity of building separate physical networks.

The solution includes end-to-end encryption and dedicated core network resources, ensuring that utility operations maintain priority access even during periods of congestion on the consumer network.

Industry analysts view the Siemens-O2 Telefonica partnership as a potential blueprint for industrial 5G adoption beyond the traditional private network model. The approach addresses a key challenge for industries with geographically distributed assets, which have struggled to justify dedicated private networks.

While initially focused on water utilities, both companies have indicated plans to expand the model to other utility sectors including electricity distribution and smart grid applications. The partnership may also open new opportunities for mobile network operators to monetize 5G infrastructure through innovative B2B models rather than competing solely on consumer services.

Operators in other regions are reportedly exploring similar partnerships, recognizing the potential of network slicing to open new revenue streams in the industrial and critical infrastructure sectors.