Why telcos need to prioritise industry ambitions in 5G rollout

Opinion Every industry is moving into a world in which its connectivity matters more than ever. The smart, connected enterprise depends on networking power, bandwidth, speed, reliability and flexibility – in an order of magnitude greater than has been needed to date.

This is where the advent of 5G is going to transform how companies operate, the pace of industrial progress and the services available to consumers.

The impact of 5G, with its faster speeds, lower latency and guaranteed quality of service, is going to be felt by every company and consumer using a mobile network. For individuals, it will make innovations like mobile cloud gaming and virtual reality accessible, as well as lowering the cost of high-speed data packages.

But the truly transformative effects of 5G will be felt in industry. From manufacturing to healthcare, 5G will enable business models that have so far been largely theoretical to become possible. The factories of the future, powered by automation, real time data analytics and virtual reality, producing bespoke products at speed and maximising efficiency, will be realised by 5G networking.

These emerging business models rely on heavily populated networks of sensors and intelligent machines, powering new technologies and supercharging the potential of IoT. Where industry has so far taken steps forward towards a smart and connected future, 5G will enable it to make leaps.

According to recent Capgemini research, this is an opportunity that large enterprises are eager to unlock. Two thirds of industrial companies want to implement 5G within two years of its availability. After cloud computing, these companies see 5G as the most important enabler to their digital transformation: ahead of advanced automation, robotics, AI and advanced data analytics.

This appetite is something that telcos need to acknowledge. One thing we know for certain about 5G is that demand is likely to outstrip supply in the early years of implementation. The cost of spectrum licenses, building new infrastructure where needed, and overcoming regulatory hurdles mean that most telcos are taking a gradual approach to rolling out 5G, and have to be selective in what they choose to build and where.

The telcos we surveyed in our research suggested it will likely be up to five years before 5G is available in the form that industry requires, providing both the speed and quality of service that can underpin new capacity needs.

While telcos determine the scope and direction of their 5G rollout, as our research shows, it would be prudent to consider the needs of industry as a priority. Not only will industrial use of 5G have the greatest impact in terms of innovation and economic output, but these large enterprises are potentially the most valuable customers for telcos – with significant and specific networking needs. Almost half (47%) of those large industrial companies that we surveyed said they would consider applying for a private license to build their own dedicated network, so their custom must not be taken for granted.

We are fast moving from the preparatory stages of 5G towards its implementation. The decisions made now, by telcos and others, will have a considerable impact on whether we can unlock the maximum benefit of this highly significant technology. Industry is eager to make 5G work in the interests of more productive, efficient and successful enterprises – those that deliver benefits for all consumers, hospital patients and energy users to name just a few examples.

Telcos need to ensure they are ready to not only keep up with but to also benefit from the demand. In this context, both industrial companies and telcos need to co-innovate, setting-up pilots and experimentation platforms to demonstrate 5G value potential and define the relevant future services, operating & business models which will steer investment.

 Interested in hearing industry leaders discuss subjects like this and sharing their use-cases? Attend the co-located 5G ExpoIoT Tech Expo, Blockchain Expo, AI & Big Data Expo, and Cyber Security & Cloud Expo World Series with upcoming events in Silicon Valley, London, and Amsterdam.

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