Is 5G a success? Ask enterprises, not consumers (Reader Forum)
The Wall Street Journal recently published an article titled “After More Than Four Years, Has 5G Lived Up to Expectations?” The article explores whether or not 5G has lived up to the hype, and potential reasons for the technology’s overall performance in the market. The implied conclusion is that it has not delivered.
As industry professionals, we must disagree with the premise of the question in the reporter’s headline. At this stage of the 5G lifecycle, the critical question is not, “How many people are using 5G?” Instead, we should ask, “What can you do today with 5G that you could not do before?”
The answer to this second more-important question reveals the inherent value of 5G. It also exposes important differences in adoption patterns, with businesses embracing new, more costly technologies as a means to creating competitive advantage. History has demonstrated that business adoption occurs first, typically followed by consumers embracing the new technology as prices fall.
It is only at this point that consumers start to recognize its value and uses. So, adoption starts with the business user – and, for business users, 5G is an exceptionally valuable solution. Here’s why…
5G technologies enable amazing new use cases, especially ones requiring massive data and low latency. These applications are occurring right now in manufacturing, agriculture, transportation, logistics, and other sectors that leverage next-generation technologies like augmented reality, autonomous guided vehicles, robotics, and others.
The U.S. government treats the 5G ecosystem as a national security priority. The encryption used in cellular networks exceeds the protocols used by Wi-Fi. Consider that the Russians still have not infiltrated the Ukrainian cellular network. With a private cellular network, data no longer needs to jump on a public network via a VPN when going outside of corporate infrastructure, giving enterprises unprecedented control and new levels of network security.
A private network can be optimized for data upload, rather than conforming to the public network business model that emphasizes downstream consumer content. Everyone appreciates baby and animal videos, but the network priorities of an enterprise tend to be ordered a bit differently, requiring better control of what content is permissible, as well as when that content is permitted.
Back to the consumer perspective: public telcos have promised 5G connectivity for years and according to our smartphone displays, many of us regularly find ourselves on a 5G network. But from a consumer perspective, has anything changed?
In Competing Against Luck, the follow-up to The Innovator’s Dilemma, Clayton M. Christensen presents a basic premise for developers and manufacturers to identify the job consumers are hiring their product to perform. This encapsulates today’s problem with consumer 5G: there is no problem that the technology is currently solving.
The use cases will eventually come but there is no current mass-market consumer need for 5G. Perhaps 5G is even exacting a ‘battery tax’ by increasing device power requirements, and potentially pushing some consumers to only use LTE and turn off 5G altogether.
Despite the current – and in all likelihood, temporary – lack of a ‘killer app’ for consumers, 5G is already delivering tangible value to businesses with a clearly defined return-on-investment (ROI). Today, the utility of 5G can be found in business applications. Tomorrow, as new applications are developed, we can expect dramatic adoption in the consumer space.
The bottom line is that the operational and spectral efficiencies provided by 5G will drive public network deployment, but if we want to find actual adoption and ROI in the near term, the pace of activity is certainly on the enterprise side of the house. The success of 5G is not about how many people are using it, but about how enterprises are using it to accomplish things they could not do before.
Allen Proithis is chief executive officer of GXC, a provider of private enterprise 5G networks and private cellular mesh technology. He is responsible for corporate strategy, product development, go-to-market activities and operations. Before joining GXC, he founded Capstone Partners, a strategic advisory firm for clients interested in digital transformation enabled by mobile, IoT, software and managed solutions. Among his successes at Capstone was the creation of 5G optimized applications for one of the first US Department of Defense private 5G network deployments.