While private 5G investment has clearly not lived up to forecasts, the technology has matured, enterprises are buying it, and it is delivering net new value. Perhaps the central dilemma here is that, generally speaking, the people selling things tend to want to sell as much as possible as quickly as possible. But in the case of heavy industry, the buyers tend not to build anything in the hopes that the value will gradually emerge. Private 5G-enabled solutions have to deliver from day one. Another wrinkle here for sellers is that selling private 5G is different from selling commodity connectivity; it requires deep familiarity with the needs of the buyer and the ability to eschew business as usual. Buyers need a customized solution so trying to sell everyone some version of the same thing can often lead you to a market reality that’s starkly less rosy than a market forecast. 

But things are coming along, according to experts convened for the forum. We heard from Future Technologies CEO Peter Cappiello that his firm’s private wireless pipeline has grown from about $40 million a year ago to around $185 million today. “It seems to be scaling every week,” he said. “We’re fairly bullish. We like the reality of it and we feel like we’re in the right place at the right time to take advantage of the market conditions.”

“I’ve been saying to my board… ‘tomorrow, tomorrow,’ for the last few years now,” Ste Ashton of NexGworx, said. And finally, he sees interest expanding from huge global enterprises to small- and medium-sized firms as well as with governments. “I think we’re ready for that wave to come,” he said. He then made an important distinction between selling private 5G to support one use case and stacking up multiple use cases to help buyers “justify that return on investment…I do believe we’re actually on the cusp of that wave at the moment.” 

Private 5G solution success is “ecosystem-dependent” 

Druid Software Senior Manager of Business Development David O’Byrne acknowledged that revenue isn’t matching up with forecasts, but “reality is always less shiny than the magic spreadsheet.” However, “Things are definitely peaking, and the amount of business we’re doing is definitely growing.” As far as why there hasn’t been an explosion in private 5G adoption by manufacturers, for instance, O’Byrne rightly noted that delivering a solution is “ecosystem-dependent” in that it requires alignment across core and radio networks as well as chipsets and devices. “We’re not building Lego here,” he said. “There is a time lag once the standard is completed to bring all of this into chipset design, into end-user devices, into radios.”

Big picture, he said, it would appear the private 5G ecosystem is “coming out of our difficult teenage years and starting to grow up into a real, serious industry.” Success “depends on the vertical, it depends on the ecosystem you need to deliver the thing.”

iBwave Market Development Director Jalal Berrahou noted regional growth in the U.S., U.K, Germany, France and Japan, as well as stand out verticals like oil and gas, energy and mining. The commonality, he said, “is all of these, they have really valid use cases” that speak to safety, security, reliability and other business-critical characteristics private 5G can deliver. But once you get out of major global industries in advanced economies, and once these types of potential buyers see the breadth of available solutions, there’s “hesitancy. They probably have a harder time justifying the ROI and the value.” As to the number of technology options, Berrahou said he’s “waiting for consolidation” in the private 5G vendor market. With consolidation, “it becomes easier to pick a solution and really prove the value of the investment…Once we get to that point, I think it’s going to become mainstream.” 

The killer app for private 5G is making something work that previously didn’t 

O’Byrne dug into the killer app vs. apps conversation, distilling his pitch to private 5G as a justified investment if it solves a recurring problem that costs a business time and money. Giving the example of autonomous guided vehicles (AGVs), he said, “If you have Wi-Fi-driven AGVs that are breaking down…your infrastructure is not fit for purpose. Then, when you have [private 5G] in, you can start to think about how do you amortize the costs, what are all the benefits this is bringing us? Then at that point you can think about moving everything…to digital…It’s really about changing the context away from what’s the killer app for this. You need the private network because something you’re doing today is not working, and that’s why you need to invest in new infrastructure.” 

Berrahou, analoging the trouble with selling a one-size-fits-all product into a market that requires tailoring with the work RF engineers have to do in the private network space, said they have to become consultants and think about the technical and business sides of the equation. Cappiello agreed that the in for private 5G is around “common sense use cases you can make a decision on today.” 

“It’s just a different mindset,” O’Byrne concluded. “You need to be business-focused to really understand this.” Of potential private 5G buyers, “You have to meet them where they are.” 

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