Andrew Parkin-White, Founding Partner of TecFutures, recently spoke at a Mext Metaverse connectivity event.
TecFutures focuses on the interplay between enterprise needs and drivers and supplier solutions and articulates growth opportunities and strategies for building competitive advantage for companies active in IoT. We do this through outstanding custom research and go-to-market solutions.
Andrew’s presentation focused on the role 5G will play in enterprise connectivity and how ready enterprises will be in adopting this technology.
He raised six key points for discussion:
1. What can 5G offer to the enterprise?
2. Do we really need 5G with other technologies?
3. What are enterprise plans in 5G – which verticals and when?
4. What do enterprises value most in 5G?
5. What do enterprises want from connectivity suppliers?
6. Bringing enterprises and suppliers together
5G offers a range of innovative features to the enterprise
Firstly, 5G provides lightning fast speeds to transfer large amounts of data rapidly for the enterprise. But a second major factor is scalability for expansion. This is an important when we are talking about connecting billions of IoT devices. Estimates vary but we could be looking at around 30 billion connected devices by 2030 on a variety of cellular and non-cellular technologies. Thirdly, low latency is often a key advantage pushed by suppliers along with high reliability. And of course, there are quite a number of enterprises and organizations that have mission critical applications where this reliability is paramount. Other interesting features include more advanced security features and network function virtualization. It is also true that 5G can be more cost effective and more easily deployed than traditional networks.
Is 5G overkill for enterprise IoT at present?
An important point is whether enterprises really need 5G given the other connectivity technologies available at present. If we look at the CSP view of enterprise demand over the next 24 months from our recent survey, we see that none of the top three connectivity technologies are cellular. 5G is the fourth most important connectivity technology but rising up the list as around 66% of enterprises are planning to use or evaluating 5G and around 5% are already using 5G IoT.
Particular 5G vertical markets will see more intense competition
Our surveys point to particular sectors where 5G is in most demand. We see that automotive and utilities are leading the pack followed by manufacturing and industrial applications. Demand is also emerging from other areas including transportation, storage and logistics and supply chain. At the other end of the spectrum and not surprisingly, in agriculture, less than half of companies are looking at 5G for their IoT applications. Asking CSPs where they see the most growth and revenue potential in the next 24 months, we see that the top of the pile is automotive manufacture and systems. This sector has the potential to be quite a crowded marketplace with fewer buying points than other verticals.
What enterprises value in 5G is not necessarily the same as CSPs are thinking
In a survey that we undertook for the Mobile Ecosystem Forum, we asked 500 enterprises already using cellular IoT which features and functions of 5G they value most. Whilst there is not a wide range in relative scores of importance, the greatest benefit is higher bandwidth than current solutions. Virtualization and 5G private networks and are in the top three and we are certainly hearing a lot of noise around private networks in the marketplace. Interestingly, lower latency appeared at the bottom of the list (but still has a relatively high score). Of course, in reality an enterprise will most probably be looking at a blended mix of functionality when selecting an IoT solution.
CSPs should tailor their offering to enterprise IoT connectivity needs
If we explore what enterprises really want from their suppliers, an interesting set of requirements starts to emerge and this is not just around pure connectivity. We see that the strongest need is for efficient device onboarding, integration and in-life management. Integrated SIMs are the second most highly rated followed by a demonstrable ROI. A consistent observation is that enterprises are not buying purely on cost. Low-cost solutions appear much lower in the priority list and it is more about the business case than cost for enterprises.
Suppliers need to position themselves to reflect enterprise priorities
Our goal at TecFutures is to provide a clear understanding of enterprise needs so that suppliers can drive competitive advantage and revenue growth through playing these back to the enterprises. We have five clear messages for IoT suppliers:
1. Understand enterprise drivers – enhance the customer experience, technology for business advantage and improved workflow
2. Recognize enterprise pain points – lack of expertise and technical understanding, need to integrate multiple technologies and concerns around security
3. Guide an enterprise through the design, build and implement process
4. Think beyond connectivity alone –offering sector-based solutions, efficient onboarding, end-to-end security, in-life management solutions and zero touch onboarding
5. Be flexible
TecFutures has ambitious plans to be a leading independent research and advisory firm focusing on the enterprise experience of digital disruption and transformation technologies and helping suppliers to capitalize on market growth.
We specialize in research-based consulting to support our clients’ tactical and strategic market decisions, identifying business opportunities for suppliers involved in the entire technology ecosystem.
Contact email@example.com for more details on how we can help with your growth ambitions. We are also happy to provide tailored briefings on our latest research findings and their implications for suppliers. Visit www.tecfutures.com to find to see our latest content, reports and custom solutions.