Telecoms.com periodically invites expert third parties to share their views on the industry’s most pressing issues. In this piece Sylwia Kechiche, Principal Analyst, Enterprise at Ookla, argues that the industry needs to do a better job of demonstrating practical applications of private network technology.
As rollouts of 5G networks progress across the world, network operators continue to name private 5G networks as one of the most exciting 5G applications and a key avenue to monetise 5G investment. There is a valid reason for it: 5G has been designed with enterprises’ needs in mind. The lower latency, faster transmission speeds, and increased network capacity facilitate enterprises digitisation.
For some industry watchers, it might feel like private 5G has been talked about for a long time and the promise hasn’t been fully realised. This isn’t totally accurate. What is true is that more manufacturers of 5G-enabled equipment still need to be convinced of the value of private 5G networks.
Original equipment manufacturers (OEMs) in the manufacturing sector need to be won around in particular. They can serve the growing number of manufacturing industry players who want to support massive IoT and critical applications by leveraging 5G and 5G stand-alone (5GSA). This is key for manufacturers to realise gains from digitising operations and the rewards are there for the taking. According to analysis by Vodafone, private 5G networks are expected to be worth £6.3bn to UK manufacturing by 2030.
So, what can network providers do to get stakeholders, including 5G OEMs and vendors, on the private network bandwagon? They need to change the narrative. What’s needed is starting the discussion with the enterprise by talking up use-cases and showcasing the business problems that private networks can solve, rather than using standard connectivity metrics. Entering smart partnerships with enterprises will drive organic demand and interest in the 5G devices ecosystem, ensure these enterprises get the most value out of private networks and allow for economies of scale.
The way things stand today
Anticipation around the still-to-be realised potential of private networks shouldn’t be mistaken for baseless hype. According to GSA, 955 organisations deployed private mobile networks across 72 countries in Q3 2022. An important caveat being that a mixture of 5G and LTE networks make up this number.
This is because many private enterprise networks continue to use the latest LTE generation: 4.9G. As the industrial 5G device ecosystem matures, more opportunities for 5G hardware will emerge. Industrial chipsets based on Release 16 of the 3GPP standard (scheduled to come to market sometime this year) will raise the bar on network latency, density, reliability, bandwidth, security, and power such hardware.
Furthermore, governments across the world are looking to private networks to meet industry 4.0 objectives. Dedicated spectrum for private mobile networks has already been allocated to enterprise use cases in a handful of countries, including France, Germany, Japan, the U.S. and the UK. Germany has been a particular hotbed for the use of localised spectrum. Some of the country’s biggest industrial players have been awarded their own 5G spectrum and are experimenting with private 5G networks to address their particular needs.
MNOs should not view this enterprise access to spectrum as a threat. There are multiple routes to deploying a private network depending on the specific needs of an enterprise, which means operators can continue to play an important role. In addition to private networks being built using enterprise-owned spectrum, enterprises can use operator-owned spectrum. There’s also the option of using public networks with agreed SLAs or public networks that use network slicing or local infrastructure at the network edge to guarantee quality of service.
Network providers who work with partners, including enterprises, to demonstrate the potential for 5G private networks are best placed to get more OEMs on board with the enhanced scope of capabilities of 5G for industrial use cases.
Securing wider buy-in for 5G’s industrial use cases
For enterprises to leverage private 5G networks and deploy relevant use cases to address their business needs, education is key. Operators can help enterprises understand which deployment method of private networks is best suited to achieve their goals and what level of network isolation they really need. In doing so, telcos go from a traditional network provider partner to a valued consultant on network transformation – a goal for many players in the space today who are pursuing additional revenue opportunities and effective monetisation of 5G.
Operators can act as this kind of consultant by utilising a network intelligence platform that makes sense of the myriad of touchpoints, services, applications and use cases across their network to offer the best possible advice on private networks and their deployment. They can use network intelligence to understand how a private network offering can best be configured to meet the expectations of enterprise customers, support industry 4.0 applications and ensure that each slice of their network performs optimally with as limited downtime and disruption as possible.
Possessing this network intelligence will enable network providers to speak on private 5G network deployments with confidence, but it doesn’t guarantee widespread take up. Operators need to go beyond core competencies to successfully engage with enterprises – specifically, by addressing their various verticals, technological and coverage needs. An effective partner ecosystem is essential to opening new markets for private network deployments.
A widening path forward
Evangelists have been touting the promise of private 5G networks since the very early days of 5G network rollouts. That promise is now becoming reality with enterprises, governments and telcos aligned on the value of private 5G networks. One of the final pieces in the puzzle is for OEMs, particularly in the manufacturing space, to get on board.
The good news is that the powerful potential of industrial chipsets based on Release 16 of 3GPP can act as a prompt for these OEMs. As can well-articulated counsel on private 5G network deployments for enterprises to understand which specific form of deployment is best suited to their needs and why.
Ultimately, network operators need to adopt the same language as their clients by selling outcomes from private network deployments like increased productivity, rather than simply selling more technology, in order for private networks to scale.
Sylwia Kechiche is Principal Industry Analyst, Enterprise at Ookla. She has over a decade’s experience as an industry analyst, and prior to Ookla, held the role of Principal Analyst, IoT and Enterprise at GSMA Intelligence where she was responsible for the development of IoT & Enterprise product, including market sizing, custom consulting, survey work and report writing.