5G ROI is impacted by spectrum availability, the use of public vs. private networks, and plans for future innovation
In 1993 AT&T launched an advertising campaign showcasing a world of high-tech innovation that many viewers assumed they would never experience in their lifetime. Through visions of video technology, remote security solutions, and mobile applications, the revolutionary ideas depicted in the “You Will” commercial series foretold the future — a future that was right around the corner.
Today, the predictions made in the early 1990s seem almost rudimentary. The importance and potential of broadband Internet connectivity is now well understood and integrated by consumers and businesses alike. As the shift to wireless broadband adoption grows across industries, so does the exploration of 5G business value and the study of whether it is worth the investment.
Who is the ideal 5G customer?
Making a business case for 5G begins with determining if integrating cellular broadband into your network connectivity solution is the best move for your organization. 5G enterprise customers are often those who currently use 4G solutions, as they have already experienced and wish to build upon the foundational benefits of cellular networking, including:
- Wire-free agility that enables business applications to be activated quickly and easily moved from one site to another.
- Increased reach for the placement of signs, videos, or temporary sites in locations where a wired connection is not feasible.
- Improved network uptime when using cellular as a primary or failover connectivity solution.
With these benefits in mind, most organizations can see the upside of including a cellular component in their network architecture, regardless of whether they have done so in the past. To determine if that solution is 5G or not, we must drill further down into how 5G nurtures the growth and innovation of a business compared to previous cellular technologies.
Understanding the 5G business value for sites, vehicles, and IoT
Businesses that quantify their worth based on uptime, response time, customer satisfaction, reach, or diverse solution offerings will quickly see how 5G business value impacts their bottom line. Those who have used 4G may already see the emerging benefits of 5G, while those that are just now dipping their toes in cellular may invest in 5G for a multitude of reasons. Whether connecting sites, vehicles, or IoT, some of the most attractive benefits that impact 5G use cases are:
It’s impossible to tout the benefits of 5G without highlighting its tremendous peak speeds and low latency — standards that remain high even as device densities increase. These performance upgrades fuel such applications as remote creation and review of computer-aided design (CAD) drawings; expansive use of real-time, high-definition video for first responders, site surveillance, and AI cameras at intersections; and combined remote services such as train station kiosks that house multiple HD cameras, interactive computing, and environmental monitoring.
The value of a 5G failover solution depends on the amount of critical traffic passing through a network. While 4G is a suitable failover solution for critical traffic such as point-of-sale transactions at a retail location, 5G solutions are better for businesses such as data centers or emergency response agencies whose failover connection must be able to accommodate all network traffic.
Even if your business is not currently in a location covered by 5G, investing in a 5G modem is still a smart move. Using dual connectivity, 5G modems are able to connect to both 4G and 5G radios, providing highly-reliable cellular coverage even in areas not yet built out with the latest cellular technology.
Simply put, if your answer to the question “Will I need 5G capabilities in the future?” is “yes” or “maybe,” the time to invest in 5G is now. This investment will not only serve your business currently, but also position it for up-and-coming features such as network slicing, which will allow enterprises to direct traffic to specialized virtual network slices based on latency, security, or speed requirements, and more.
Additional factors impacting 5G ROI
5G business value is impacted by more than whether a business sees value in the intrinsic network benefits. Some factors — such as spectrum availability and the use of public vs. private networks — will also play a role in 5G ROI.
Spectrum availability and adoption
With the buildout of three types of 5G underway, businesses must make decisions about how to capitalize on available spectrum and optimize it for their unique use cases. For example, mmWave 5G can provide the density and throughput needed to support a heavily populated college campus, while mid-band 5G may be better suited for augmented reality in a commerce environment.
Further, while 5G may be the ideal technology for certain industries, locations, or applications, others may be sufficiently served by Wi-Fi, 4G, or even earlier iterations of cellular technology. Regardless of network choice, each solution will come with its own set of rate plan options that will have varying ROI impacts depending on a company’s initial budget.
Public vs. private cellular networks
If you’re in an industry where failover, speed, innovation, or scalability are important, investments in 5G routers and available rate plans are inevitable. Most enterprise businesses will pursue growth in at least one of those areas, and once they do, they will have to choose between the use of public vs. private cellular network solutions.
The ROI of private cellular depends largely upon what it would cost to enhance the public infrastructure in a specific location. For instance, the cost of establishing and maintaining a private cellular network in a stadium or shipping yard may be less than building new public cell towers in the same area, with most companies achieving a positive private cellular ROI within 2-3 years.
Ericsson predicts that by the end of 2028, 5G will cover nearly 85% of the world’s population, compared to roughly 30% at the end of 2022. Clearly it’s time to stop postponing the deep dive into enterprise 5G research and start realizing the value of 5G business.