In today’s episode of The 5G Factor, our newest webcast focused on all things 5G, I was joined by my fellow analysts, Ron Westfall and Olivier Blanchard. Our focus was on the magic that 5G networks provide, and insights on what kind of innovative things companies like Ericsson, Nokia, and AT&T, along with savvy communication services providers (CSPs), are doing with private 5G networks.
Our conversation included:
- An update on what is driving the 5G private market uptake and the overall market prospects for private 5G
• What the private LTE and 5G networks that are rolling out look like
- The industries who (today) benefit most from this kind of offering, which include manufacturers, utilities (offshore and power), ports and airport sectors, and the mining and process industry
- We also discussed the use of private 5G in media and entertainment, including in sports arenas and event venues, as well as in healthcare
- Some of the key things that make private 5G networks for the enterprise both reliable and attractive
- The benefit of enhanced security a private 5G network affords compared to WiFi
- How vendors like Ericsson and Nokia and operators like AT&T, Vodafone, and Telefonica are positioning themselves to take advantage of private 5G market expansion and improve competitive outcomes
- The savvy communication services providers (CSPs) that are jumping in and partnering with companies like AT&T and Nokia (to name just a couple) and the fact that we believe that smart partnerships are key to solving customer challenges
We wrapped up the show with insights from Olivier Blanchard, our resident expert on Qualcomm, the innovation powerhouse. Olivier provided an overview of what the company is doing at its corporate headquarters in San Diego, testing and demonstrating new developments in 5G, efficiency, techniques, methodologies, equipment, and more.
If you’re interested in 5G, this is a series you’ll want to tune into on the regular.
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Shelly Kramer: Hello and welcome to the Futurum Tech Webcast. This show is All Things 5G, and it’s a new series that we’re doing, and we haven’t yet hit on the most clever of names. So today, we’re going to call it All Things 5G. And I am joined today by my fellow analysts, Ron Westfall and Olivier Blanchard. And today we’re going to talk about the magic in private 5G networks. And the old telco supply chain is undergoing a huge process of really digital transformation and of mutating and multiplying and how it’s making its way into enterprise premises and the things that private by 5G is offering up. So it’s an exciting time.
And we’re going to talk a little bit about, what private 5G networks look like. The value proposition of private 5G networks, who some of the key players are, what some of the innovation that’s happening around that. So, with that said, one of the things I want to kick this conversation off with gentlemen, is I want to talk about, really let’s talk about why private 5G? Ron, start us off.
Ron Westfall: Excellent Q. Thank you, Shelly. And yeah, so I think one term really explains the uptake of private 5G networking, why it’s such a hot topic, and that is Industry 4.0. This is primarily or exclusively a service that’s aimed at the enterprise segment. And it entails really, the ability for organizations to use a plethora of sensors, and collaborative robots, and other capabilities throughout their facilities. You name it. A smart factory, a smart facility, smart fill in the blank.
And this is really, I think, very exciting because what we’re seeing now is the successful implementation of private 5G networking. And it’s really can be attributed to additional drivers. For example, regulators have basically pushed a Sub-6GHz spectrum for availability, and that would be suitable for many of these scenarios. And likewise, there’s just more availability of unlicensed and shared spectrum that would be supportive of private 5G networking.
And a little foregrounding, private networking has been around for a while, and we’ve had a successful private LTE networks being implemented leading into the now uptake of what is called 5G non-standalone, really the combination of 4G and 5G capabilities. And now we’re kicking into 5G standalone networking for these 5G scenarios. And this is all coming together. And I think one reason why Industry 4.0 is really keen on private 5G networking, is that first of all, it’s a security first implementation. Many of these organizations are weary about using public 5G networking to support the smart capabilities. And this makes sense.
In addition, it’s also fundamentally about coverage. That is, when you’re talking about operations like mining and sea ports and airports and so forth. The off shore drilling facilities, Wi-Fi is just a non-applicable. So it’s a non-starter. And it’s the same reason here as well in terms of security, 5G just has built in security capabilities that Wi-Fi, even with the current iterations, really don’t deliver quite yet. And Wi-Fi could be appropriate, for a guest services at a hotel, a visit to the coffee shop for, internal communications, operations center, but it’s not going to be able to do the heavy lifting that a private 5G network can do. And so this is adding fuel to the uptake.
For example, we’ve seen research from Polaris suggesting that there’s 40% compounded annual growth expected in this segment alone through 2028. And as a kicker, you have ABI coming in and saying 60% compound annual growth in this segment through 2030. And, we can always press on the numbers, but I think it definitely is validating the fact that this is really a space that is hot and it’s only going to get hotter. And these are many of the reasons why it’s this coming together and generating these headlines that we’re talking about today.
Shelly Kramer: Well, and I think that, when we think about the industries on the forefront of using this, as you touched on them, manufacturing, utilities, airports, ports, the mining and the process industry, there’s also other applications that maybe some of us have even experienced it and not known about it. For instance, I know that there’s been a lot of work in private 5G networks for arenas and sports venues. And part of that focus is bringing the fan engagement level up. And we’ve got a fan base these days who are adept at digital content creation.
And many of those enthusiasts have moved beyond the interest in just taking a photo while they’re at an event and uploading it. And they really want to be, shooting video, creating video, doing all different kinds of things. When you think about it, the way we use our today is so much different, even than it was five years ago. And in this world five years is a really long time. So I think that when you’re thinking about, the applications for private 5G networks, it really expands beyond what you might think.
Ron Westfall: Oh, yes. I mean, there’s just a host of possibilities. And this is a similar to what we witnessed with LTE when it was first built out, nobody can predict Uber. we’ve touched on this before. And same thing applies to private 5G networking. And there’s also work from home scenarios. There is, any smart facility that includes smart arenas, where there is a application of private 5G networking.
And I think this is all very exciting and it’s also correlating to follow the money, or follow the organization chart. We’re seeing organizations like Ericsson and Nokia literally coming out with their own units dedicated exclusively to this. For example, Ericsson, private 5G, at Nokia, private 5G and so forth. In fact, Nokia actually has what is called a Digital Automation Cloud that addresses this very space.
And you have the major telcos, Telefonica, AT&T, Vodafone, Verizon, they’re all looking to capitalize on this. And I think one thing that is very important to understand here and why they’re doing this is that, they have expertise in this area. They own the spectrum. They know how to optimize MIMO implementations, how to optimize radio networking and so forth. And so this gives them the opportunity to manage many of these services, to work with organizations that aren’t going to be keen on doing it all by themselves. Just so to speak. And so there’s plenty of opportunity here for the telcos to show off their skills and working with their major supplier partners to really make this more of an addressable market, to take advantage of more opportunities. So yes, this is again, a good example of how the ecosystem can come together and make a difference
Shelly Kramer: You mentioned, Nokia and AT&T, I know they’re two of the major players in the space. I came across some examples that I thought were interesting, that would be interesting to our audience anyway, of this in motion. Edzcom and Nokia installed a private network at the KymiRing arena in Finland. It’s the largest motor sports and events venue in Northern Europe. And they designed this network to help, as I mentioned earlier, augment media streaming and television broadcast services, but they also want it to help with their testing of autonomous vehicles and connected vehicles, which is really cool. So Edzcom, the Finnish company, is partnering with Nokia and using the Edge network and the computing infrastructure to be able to offer this in the stadium, which I think is cool.
Another thing that I thought was really fascinating is, AT&T has a partnership with, they’ve built a private 5G network that’s being used for the Ellison Institute, which is one of the first medical facilities in the country to use 5G to help advance cancer research. Okay. So it’s really cool to think about Industry 4.0 and better fan experiences, but cancer research? To me, that’s really cool. And what they’re doing here is, the doctors want to be able to use the network to collect and transmit data from patients to connected devices.
So doing a better process of monitoring patients, being able to deliver better care, being able to detect more rapidly, that sort of thing. So I think we’re going to see this expand beyond what our purview is of… It’s not just Industry 4.0, it’s so many other things that benefit, so many other enterprises and initiatives that benefit from private 5G networks. And I think that’s really why we’re expected to see such growth in this market that you just touched on.
Ron Westfall: Excellent examples. Excellent use cases Shelly. And yes, Nokia has over 300 customers already and is considered the market leader from a supplier perspective in this segment. And Ericsson, for example, acquired Cradlepoint last year for $1.1 billion to catalyze their pursuit of this market opportunity. And yes, I think we’re seeing all kinds of great ecosystem collaboration that further validates your point, Shelly.
For example, we’ve seen Verizon Business and AWS partner to support Corning and its smart factory implementation. And that is, using those smart sensors and robotics. So this is a futuristic minority court type scenarios actually becoming real today. So this is definitely, I think, something that will pick up even more momentum.
And I had mentioned that there was a scoop last week and it’s still a scoop-like aspect here. And that is, NTT is, I believe, the first CSP to offer private 5G networking as a service. So now, it’s not just a managed services proposition. You can actually go onto a portal and order up this entire capability through a operator like NTT, and they’re using their patent pending micro slicing technology to enable this breakthrough. So we’re seeing a pattern here, once they get in Japan as being the citadel of innovation and breakthrough when it comes to 5G networking, Open RAN capabilities, all the moves that Rakuten did at the beginning of August, et cetera.
So again, this is just adding fuel to why private 5G is such an attractive offering and why it’s different from previous private networking implementations, which were niche, which had a limited market appeal. But now, it’s really opening up and broadening because 5G is becoming more mainstream. Everybody’s becoming more familiar with its capabilities, taking advantage of the lower latency, higher bandwidth, better security capabilities. And so this is just good news all around.
Shelly Kramer: Yeah. And I think that this is also where you’re seeing, we’ve talked a lot about this, but the opportunities that exist for CSPs, communication services providers out there, they abound, right? Opportunities abound. And when we’re telling these stories about Edzcom for instance, Edzcom wanted to be able to provide this functionality at the motor sports arena. Partnered with Nokia. I noticed AT&T has a partnership with CSP called ExteNet. And their focus is also on enhancing connectivity in sports, in entertainment venues and on campuses.
And they are using fiber and 4G LTE, and 5G and private LTE and all of those things. And you can see this partnership and action for instance, AT&T Stadium in Arlington, Texas. And so it really is being driven in many instances by smart communication services providers understanding the market opportunity here and then partnering with providers to help bring this connectivity. And not that Ericsson and Nokia aren’t doing their own fair share of selling these things but I think this is a huge opportunity for CSPs as well.
Ron Westfall: Yeah, it’s a rising tide. You have Nokia emphasizing their radio expertise as being a key differentiator, why they can win more deals than some of the other newbies that are coming on and looking to target this space. And I think it’s also important to note that it is indeed a end-to-end proposition, that it is an ecosystem play.
For example, when it comes to 5G core programmability, I have Ericsson touting that capability and how it’s very important for supporting now private 5G networking and how, for example, by the use of programmability, how that flexibility to really do what is use case networking that is using network slices, using that network to be very specific to the needs of that unique customer. And so that again, I think is reinforcing your point Shelly that this is a great way for the ecosystem to showcase how they are successfully meeting these opportunities. And that is just really going to fill the ability of the operators to win their own business working with these suppliers. And I think we understand why that the telcos would have a built-in advantage.
To be sure the cloud providers, so hyperscalers, the Azures, AWSs, the Google Clouds will work with the operators, as our examples have already shown. And I think they just want to make sure that they have a play in the game. For example, Microsoft upped its Mac offering. That is, every hyperscaler understands that 5G build entails the opportunity to build more edge networking resources that is get as much of these 5G capabilities as close to the 5G activity in order to achieve these low latency capabilities and all the agility and so forth that is required to make this market take off even more. And so, there’s just, I think, plenty of pie to go around for all these players to be able to monetize and simply make more revenues at least, off of this emerging market opportunity.
Shelly Kramer: Absolutely. So, for our viewing audience, I want to make sure that everybody knows that Olivier Blanchard is not here just to be eye candy. His involvement in this conversation is key. And I feel like it’s impossible to talk about 5G and innovation and what’s now, and what’s next and all of the exciting things happening, quite honestly, without bringing Qualcomm into the conversation. And that’s really… Olivier spends a lot of time immersed in all things Qualcomm. And I know, Olivier, what the company is doing in San Francisco, with its corporate headquarters is all about testing and constantly demonstrating new capabilities and all different kinds of things. Talk with us a little bit, if you will, about innovation and how Qualcomm is driving that as it relates to 5G.
Olivier Blanchard: Yeah. So there’s a lot of stuff going on, and I’m only going to mention like a tiny, tiny little sliver that’s relevant to this conversation. I’m just happy that I’ve gotten to the point now where I can listen to Ron, and understand everything he said.
Shelly Kramer: It’s such a big deal. It’s such a big deal.
Olivier Blanchard: It wasn’t always so, and now I understood everything and it all makes sense and I’m very happy about that.
Shelly Kramer: And you know what’s really crazy? From my point of view is not only have I been able to understand what Ron is saying, I actually can speak about it and know what I’m about. And so I feel like personally, I’ve made great strides as well, with Ron as my mentor.
Olivier Blanchard: Yep. Yep. I’m in the same boat. Okay. So Qualcomm, so one thing that a lot of people don’t… Well, most of what Qualcomm does, people, excuse me, don’t necessarily have visibility on. Because I think we’re aware of the Snapdragon mobile platform and all of the Snapdragon related products. We’re aware that they have really good modems and that they’re very active in R&D for 5G. And they contribute to a lot of the standards and so on and so forth.
But something that as an analyst who’s been following them for a while and being pretty immersed in their universe, there is something that I’ve noticed is that they have these testbeds, essentially, these warehouses where not only do they test new technologies, new techniques, new methodologies to optimize 5G networks and all of the equipment that goes with it, but they also use them as demos. And so their demos for industry partners, obviously Ron has touched on the fact that this is a very rich ecosystem of companies, on the one hand, competing against each other, but also all working together because there’s so many layers to this and so many moving pieces that they all have to put all the pieces together for their clients, for their customers.
And in the case of, of private 5G networks, that adds a few more layers of complexity on the front end, because you don’t just subscribe to a service that a carrier has provided for you, you have to build stuff from scratch. And so these demos are always out there and periodically, Qualcomm will update the market on what’s new. And typically there’s an analyst day, there’s usually one or two a year, where they bring tech, journalists analysts, and some influencers even, to their headquarters in San Diego to tour some of these testbeds and see what’s going on and actually see it live.
And with COVID, and travel being restricted for the last year and a half, that has moved to a more virtual presentation. And I think that some of it gets missed because there’s just so much news out there and so much churn. And so many of these companies doing stuff like this now that a lot of our audience may have missed some of what’s been happening at Qualcomm, and what’s coming down the pike in terms of private 5G network. And especially for Industry 4.0 applications. So I’m currently writing three pieces on this, which will publish on our website in the next week or week or so. So look for that.
But a couple of points that I wanted to mention, so people are aware of them, is that when we talk about private 5G, just like public 5G networks, this isn’t a fixed target. The technologies, the optimizations, the capabilities are going to keep improving and they’re going to keep improving every few months.
And so for instance, one of the things that attracted my attention when I was doing research on all these new testbeds, is that Qualcomm is already working on optimizing a thing called TSN, Time-Sensitive Networking. And what that allows industries to do is provide microsecond level synchronization of all their devices. So imagine that you have a warehouse, a modern warehouse with robots essentially driving things around, you don’t go to the shelves anymore necessarily, the shelves can come to you. So, you’re an Amazon warehouse, it could be any warehouse, any sorting center where you’re going to have automated guided vehicles, this micro Time-Sensitive Networking, microsecond level synchronization allows all these things to work better in concert. So that the level of complexity that’s, that’s required for everything to work together so things don’t run into each other, so you don’t have problems is improving.
Also, what I’m seeing is a push for Sidelink capacity. So that allows the devices to not only talk to the network in real time with very low latency, but also talk to each other. Which I think is a really important layer when we’re talking about private 5G networks, especially in Industry 4.0.
Shelly Kramer: Absolutely.
Olivier Blanchard: And there’s also indoor precision positioning, which is also getting super, super good. So you have centimeter level accuracy to be able to track all of your AGVs, your automated guided vehicles in that environment.
But also something that, that we don’t talk about enough, I think, in terms of 5G network optimization, is power consumption. So we talk about power consumption in the IoT in terms of the device itself using low power so that it can run a lot longer on the same charge, but we’re also now starting to see 5G networks become optimized for, essentially become greener. And so some of the testbeds that I was researching show new methodologies for end-to-end system techniques that can compensate for power amplification issues, especially nonlinearity, that’s a tough one to say for a Frenchie.
So essentially what it does is it creates new optimizations for networks. And especially this is going to be very useful for private networks where every ounce of power counts. And it’s also a huge cost issue when you’re running a plant, or whether it’s the plant itself or the network that you’re running through the plant, networks are able to become a lot greener now through these optimizations, through these new power efficiencies. I was working on all this stuff. They have really interesting things to share. And so look for three articles on this in the next couple of weeks from me.
Shelly Kramer: Absolutely. We’re excited about that. Well, gentlemen, I think our time here has come to an end for our audience. Thank you very much. There’s my dog saying it’s time to put this show to an end. No, thank you very much for hanging out with us, whether you’re watching, whether you’re listening, if you’re watching the YouTube video, be sure and hit that subscribe button, so you don’t miss another conversation. If you’re listening to the podcast, likewise, hit that subscribe button. We are always happy to have you and appreciate you.
Olivier and Ron, thank you so much for contributing your insights here. Always appreciated. And tune in again next week for All Things 5G.