With the hype around public and private 5G, it can sometimes be difficult for enterprises to discern the state of private 5G and its fit for different use cases. In AvidThink’s consultations with tier-1 mobile network operators (MNOs), engagement with leading private wireless vendors, and conversations with large enterprises, we’ve encountered several misconceptions and half-truths that need to be clarified.
In partnership with sponsor Federated Wireless and with underwriting from AWS, we’ve put together a three-part blog series focused on the reality of private mobile networks (PMNs) today. We hope our efforts help enterprises in sorting out the wheat from the chaff of private wireless information out in the wild.
Private 5G beckons
Private wireless networks conformant with 3GPP mobile standards were available to enterprises before the arrival of 5G. However, increasing awareness of the benefits of 5G (and 4G LTE) compared to alternative enterprise access technologies such as WiFi or wired Ethernet, along with favorable spectrum licensing in certain countries, has accelerated enterprise interest in private wireless.
Simultaneously, the strong interest from enterprises has resulted in many vendors jumping on the PMN bandwagon, each pushing forward positioning favorable to each vendor. This aggressiveness in messaging has sometimes created more confusion. Let’s dispel a few common misconceptions here and deal with the others in a subsequent blog post.
We’ll start with three common misconceptions under the umbrella of technology maturity.
Private 5G is 4G in disguise
For ease of reference, and sometimes to benefit from the 5G halo effect, these vendors brand their private 4G LTE networks under the private 5G moniker. Using the private 5G label can lead enterprises to think they are contracting to purchase 5G technology when they are getting 4G LTE. Today, many private wireless deployments — analysts and vendors estimate around 70-80% — are private 4G LTE. Private 5G is available for purchase and deployment, but it may be another year or more before it becomes the predominant technology. Even if the 5G umbrella is convenient for marketing, vendors should be upfront with enterprise customers about what the customers are buying.
WiFi 7 or 8 will obviate enterprise need for private 5G
WiFi is familiar and ubiquitous. It’s also been improving rapidly, with a new generation showing up every 5-6 years with increased speeds, features, and mobility support. WiFi has selectively adopted mobile technology innovations like MU-MIMO in WiFi 5 and OFDMA in WiFi 6, closing the gap in performance (coverage, speed) between the two technologies.
However, even with WiFi 7 on the horizon, there continues to be fundamental differences. These include centralized management of handoffs between base stations, availability of licensed spectrum, and secure identity management. Some of these capabilities are needed by enterprises for specific use cases — high-speed mobility with trains, improved and reliable coverage in interference-rich industrial environments, and extensive coverage in outdoor environments for applications like digital signage.
Regardless, PMNs (both 4G LTE and 5G) and WiFi are complimentary; we expect the two to coexist and thrive in the coming years.
Private 5G has a limited device ecosystem.
There are indeed fewer private 5G devices today than 4G LTE. However, there are sufficient 5G device varieties to support effective deployment in most use cases. For example, numerous 5G cellular modems and routers today can connect industrial and medical equipment to 5G networks via ethernet ports. Likewise, ruggedized 5G phones and tablets are available for outdoor or indoor industrial settings. And the 5G ecosystem continues to rapidly expand.
In enterprise WiFi deployment, the spectrum conversation seldom comes up. Sure, IT teams discuss 2.4 GHz vs. 5 GHz vs. 6 GHz and channel conflict and radio resource management, but there’s rarely conversation around whether licensed spectrum is required or whether shared spectrum is sufficient. With private 5G or 4G LTE deployments, the spectrum discussion will come up, and the nature of the conversation will be different in different geographic regions.
Private 5G requires carrier and spectrum licenses to work
Some enterprises believe that private 5G deployment requires contracting with a mobile operator with spectrum licenses. In countries that do not allow enterprises to hold private spectrum licenses and do not yet have shared spectrum schemes like Citizens Band Radio Spectrum (CBRS), enterprises must work with mobile operators. However, in the United States, to the extent that the CBRS General Authorized Access (GAA) allocation provides enough capacity (at the appropriate locations), enterprises can deploy a private network themselves or with the aid of the vendor or system integrator without the involvement of an operator. Remember that CBRS is shared and available spectrum at a location is dependent on whether there’s an incumbent like the US Navy operating in the area and whether priority access license (PAL) holders are using allocated spectrum. Enterprises who need more guaranteed bandwidth may lease from an existing PAL holder if available.
In countries like Germany and Japan, enterprises can obtain enterprise spectrum licenses directly from their governments at reasonable rates for PMN use.
No global unified private 5G model
As should be evident from the above discussion, enterprises will need to adapt their 5G strategies to each country’s specific regulations due to differences in spectrum policies. In particular countries, they will have to work with the local mobile operators; in others, they can obtain and manage their own spectrum licenses. This situation will unfortunately be the reality for a while until there’s (hopefully) a global rationalization and harmonization of 5G unlicensed bands.
WiFi is cost-effective, costing multiple tens of cents per square foot of coverage. And the price of adding WiFi support to devices is minimal, resulting in numerous devices being WiFi-enabled, from light bulbs to ovens, printers, and even toys. Likewise, WiFi access points (APs) run from tens of dollars to high hundreds for high-end enterprise-class APs.
5G-enabled devices are more expensive than 4G-enabled devices — there is currently a 20-30% premium over 4G models for 5G-enabled cellular modems. And 5G small cells, other RAN equipment, and 5G core software licenses hold a hefty premium over 4G RAN and core today. Current supply chain constraints, which have resulted in higher prices of new electronic equipment, further exacerbate this premium. The price will drop as supply chains return to normal, 5G deployments become more common, and scale economies and learning curve effects kick in.
For many deployments today, 4G LTE provides adequate bandwidth capacity and should be considered as a complement to WiFi. As private 5G costs drop, the enterprise can migrate to a 5G network when an appropriate ROI can be achieved.
There are more private 5G half-truths to dig into, and we will do so in our second article in the series, where we focus on deployment and integration. Stay tuned for the next post, but if you’re dying to get your answers quickly, then you might want to check out the following resources from the sponsors: