Solving for cost, complexity and differentiation to accelerate private cellular adoption
The market for private cellular solutions has materialized somewhat slowly and in fits and starts, but major NEPs and SIs are working to stake their claim on what will eventually be a high-value global market. Given the well-articulated Industry 4.0 vision and the consensus that private cellular has an important role to play, what’s the hold up? Nextivity CEO Michiel Lotter boiled it down to cost, complexity and differentiation as compared to Wi-Fi.
“On the cost side, I think the industry has done a great job of painting this vision of what an enterprise can achieve when they deploy a private network. But the vision is extremely grand.”
To a user, a grand vision equates to a big price tag. And given the difference in enterprise know-how with regard to Wi-Fi as compared to cellular, there’s also a major complexity burden both in terms of implementation and long-term management. And Wi-Fi continues to see incremental improvements with Wi-Fi 6 hitting the market and Wi-Fi 7 on its heels. Given this, for a technology buyer, “It’s not really clear why they need to go through the cost and complexity issues if you can’t differentiate the use case well enough from what can be achieved with Wi-Fi. It creates the perfect storm to slow down the investment in private networks.”
To listen to the full conversation with Lotter, check out the second installment in a four-part podcast series exploring enterprise wireless in the Industry 4.0 era.
In terms of working towards that grand vision of Industry 4.0, Lotter said the starting point is to find and focus on mission critical applications that deliver immediate business value. To do that using a private network, it’s incumbent on private network providers to lower the barrier to entry and make it easy for the users to leverage the capabilities it brings.
“I think lowering the barrier to entry comes with a whole bunch of focus points we need to take into account,” including the technology and business and support models. This sets the stage “so that the enterprise can focus on the things they are good at. We need to enable them to make a difference in their business as opposed to trying to make them experts in private cellular networking.”
Lotter also called out the delta between the cutting-edge private 5G hype that stands in contrast of private LTE deployments creating meaningful business value at scale. This paradigm “puts the technology first and it doesn’t put the customer first. I think then you end up in this classic solution-looking-for-a-problem scenario.” With increasingly liberalized access to spectrum—like with the CBRS band in the U.S.—enterprises can pick the right technology for their particular strategy and desired outcome.
Regardless of whether it’s 4G or 5G, Lotter rightly pointed out that mobile applications over a large geographic area can be supported by private cellular but not Wi-Fi. “The fundamental business principles still apply here. Us as an OEM…we want to be in a position where the value that our products and services provide to customers are undeniable.”
For more on enterprise wireless, read the following articles and listen to the linked podcasts:
- The four pillars of an enterprise wireless strategy
- Cellular vs. Wi-Fi—making the case for mobility
- How Nextivity is bringing private LTE to the middleprise
- Understanding enterprise wireless: Part 1—developing a strategy
- Understanding enterprise wireless: Part 3—cellular vs. Wi-Fi
- Understanding enterprise wireless: Part 4—private cellular in action
