After nearly a decade of planning and investment, 5G is now a reality. Despite the excitement and the buzz that it generates within the communications industry, today the average subscriber is unlikely to be experiencing the benefits of 5G in their daily lives - at least not in any meaningful way. That’s because for now, the area where 5G can be most disruptive and influential is in the enterprise space. As a result, interest in private networks is gaining ground.
For most operators, their enterprise ambitions transcend simple mobile connectivity for business users as they look to diversify their service offerings: private 5G networks are beginning to play a central role in this. The increased bandwidth, ultra-low latency, better security, reliability, and scalability that private 5G networks deliver will be instrumental to the success of enterprises as they continue to innovate and modernize operations and processes.
How 5G will advance operations
Fundamentally 5G gives enterprises carte blanche to reimagine their existing connectivity solutions, and subsequently their ambitions for evolution and growth. There is now a growing awareness amongst enterprises that a strong and reliable connectivity is a key enabler of improved operational efficiency, enhanced service innovation and improved productivity. Such business outcomes can be hugely advanced through a 5G private network.
For example, one industry vertical that benefits significantly from private 5G is the manufacturing sector. According to the Manufacturing Institute, 92% of manufacturers believe the utilization of 5G in their facilities will help transform business processes and improve operations overall. The latest generation of cellular technology is now seen as foundational to the success of the manufacturing sector as the low latency and high reliability offered by 5G can support the use of virtual reality (VR) and augmented reality (AR) applications, the ability to keep track of inventory and equipment in real-time, and even enable mobile robots, and autonomous vehicles.
Another use case where the benefits of 5G private networks are evident is precision agriculture. Precision agriculture increases the amount of food produced and improves supply-chain efficiency as 5G enabled connected machines and robots take on many time and labor-intensive farming activities. They can perform these tasks in real-time, around the clock, and even when faced with poor weather conditions. 5G facilitates smarter data communications between farm management systems and IoT devices, such as drones, that can then be used to gather and transmit real-time data to farmers and agricultural workers via their equipment in the fields.
Overcoming existing connectivity limitations with 5G
Based on the use cases above, we’ve seen how impactful 5G can be on different industries.4G and Wi-Fi are not well suited to serve the next generation of mobile and data hungry applications as they are limited by lower speeds and higher latency – simply, they are less able to support the specific business needs.
Analysys Mason predicts that the private 5G market will exceed 20,000 private networks by 2026, and enterprise spend on these networks will reach USD 5 billion in the same year. While this sounds like a lot of networks and investment, when seen in context it’s still less than 10% of what will be spent on public LTE and 5G networks over the next five years. So what’s the hold up? Essentially this comes down to four main factors.
The first is cost. 5G private networks offer a variety of benefits, but at the same time, the cost of buildout is high, especially in comparison to Wi-Fi. It’s mainly large enterprises that can really afford to invest.
Secondly, with each industry needing differing requirements from its private 5G network, taking advantage of economies of scale is all but impossible. For global businesses, there is also the added complication of numerous spectrum, regulations, deployment models, and interoperability variables that can negatively influence roll-out plans across geographies: what works in the US will be different in China or Europe. Progress in this area remains slow, but as the industry gains more experience with private 5G network rollouts, overall efficiency and rapidity will follow.
Thirdly, legacy hurdles represent a significant challenge in terms of adapting a business environment built around Ethernet and Wi-Fi and then switching it to cellular. The existing equipment, devices and applications need to be able to perform in a 5G world and this particular task requires more than a bit of planning and testing. 5G compatible products and end devices are also required.
Finally, while enterprise can own a private 5G network, they still require a fairly significant amount of support to maintain and optimize it. This is where operators can play a pivotal role when it comes to managing private networks on behalf of the enterprise. While a typical enterprise may already have a well-versed IT team capable of handling Wi-Fi network management, the skillset required to define the needs, deploy and manage a private network solution is radically different. Operators can therefore provide this much needed skillset and simultaneously remove the considerable learning curve that’s often associated with deploying or adopting advanced technologies such as private 5G networks.
Operators can leverage the private network opportunity by selling slices of their public network in order to deliver private 5G. A Network-as-a-Service (NaaS) perspective can combine public with private and each network slice can come preconfigured with its own guaranteed SLAs that would be mainly managed by the Mobile Network Operator. This would provide an easier on-ramp for enterprises to leverage the benefits of 5G private networks – without all the headaches. Eventually there will likely be a ‘5G-in-a-box’ type of solution designed for different verticals – checking all the boxes and requirements for their specific domain.
Looking towards the future
It’s clear that 5G private networks have the potential to transform industries across the world, but getting there will take time. The ability to plan, design, assure and optimize 5G networks tailored to the business needs will be critical to their success, and it requires an expertise in radio networks that goes well beyond the remit and capabilities of typical enterprise IT teams. Enterprises can now look forward to embracing 5G private network solutions to unlock the cutting-edge technology benefits of 5G that underpin their strategic roadmaps. Private networks alone hold the key to a truly customized connectivity solution that guarantees the appropriate levels of performance, reliability, security, and control for all enterprises.
