It is always good to talk to Celona. The California scale-up has taken a position as an agitator in the excitable private networks market, positioning itself as an enterprise-friendly alternative to the likes of Nokia and Ericsson, with a cellular system born of deliberate cloud-based IT rather than of shrunk-down telco infrastructure (or so it says), and a decent roster of channel partners to give its hyperbole some kind of heft. And, as the hype around private networks slows, and the market gets to grips with the gnarlier challenge of commercial workloads, it is still at it; the private 5G game is now a three horse race, it says.
Chatting away ahead of its showcase at MWC in Barcelona (from where the company took its name) at the end of February, Rajeev Shah, co-founder and chief executive at Celona, responds to a question about how the market has slumped into a ‘trough of disillusionment’ (to use the Gartner parlance), and whether opportunist suppliers have started to flee – as they have from the parallel low-power end of the IoT sector. “That’s fair; at the peak of the hype cycle, there were lots of players that thought they had a role to play, and which contributed to all the noise,” he says.
“Pretty much everyone was coming at it, saying, ‘this is my growth area’, and putting out press releases. But the enterprise market has spoken, and said, ‘if we’re going to be serious, then we need an end-to-end solution that meets all our system requirements’. And that long list has become a short list of players that can offer such a solution; and realistically, at this point, that list comprises Nokia, Ericsson, and ourselves. So the amount of noise has reduced, because the number of people making it has reduced – because their systems don’t cut it for what enterprises want to do.”
So who has dropped out, then? Shah does not want to name names. But then his list-of-three excludes some major ones – including big cloud providers like AWS and Microsoft that made a splash a couple of years back, a number of bit-part radio and core providers selling via bigger integrator brands, plus a swarm of noisy CBRS players offering related services, a hatful of niche specialists, and a handful of major IT/OT operatives whose propositions are yet to mature. Shah plays a straight bat (swatting away his own leg-spinner): “I just think a lot of companies have not got the traction that we have.”
Aw, come on; who? But he’s not interested to say much more. What about Cisco? What about the new HPE-plus-Athonet (plus-Juniper) setup? Surely that looks like the kind of enterprise-friendly (Wi-Fi friendly) system that Celona likes to talk about? He responds: “I mean, the [Juniper] acquisition is still fresh. But, yes, I was expecting HPE and Cisco to be harbingers of the future; more than anyone else. And they may still be. I expect them to do something in this space, given their strong enterprise DNA. And we see them sporadically, but I suspect they are in a development lifecycle, building out their portfolio at this point.”
It is like surfers following the summer; moving up the coast, across the ocean, in pursuit of the perfect break. Just like in IoT. “That first wave has crashed,” responds Shah. “My filter, now, whenever I have a conversation about a possible partnership, is to ask: ‘do you sell to enterprises?’ Because if you do, then there is a legitimate chance this is a real market for you. But if you’re not selling to enterprises, and you’re only in it because the telco ecosystem says private networks are a big deal, and because all your service provider customers are doing it, then you are going to be disappointed.”
He really doesn’t want to name names, but he is forthcoming about AWS, in ways – as the lead party in a robust private-5G co-creation play, at least, rather than as a vendor-integrator in its own right. AWS is selling the Celona system, as part of a broad multi-party hybrid-edge change-platform for enterprises. The two are working with Stanford Health Care (SHC), part of Stanford University Medical Center, on a neutral host system in CBRS spectrum; so far, T-Mobile has taken residence on the network at the SHC site, and is selling Celona’s neutral-host system more widely in the US. “AWS lives in a much bigger universe, but it wants to learn deeply about the market,” he says.
The implication is the cloud firm’s focus on ecosystem-building, in mob-handed pursuit of complex enterprise problems, means its original self-serve philosophy around private 5G is less visible than its partnership activity – at least in “large mission-critical networks that need many other things”. Shah remarks: “I continue to be super-impressed by how customer focused it is. Every time we bring a real customer, a real problem, it has very little religion about how things are done. All it cares about is: you have a customer and the customer has a problem – which we can solve together; so let’s go to work.”
And that’s the end of the conversation about rivalries. Shah is more than happy, of course, to plug the firm’s partners – Verizon Business and NTT for private 5G sales; T-Mobile for neutral host systems; AWS for edge/cloud team sports; plus others – and is happy also to point out Celona’s distinguishing marks, compared to Nokia and Ericsson. On the last point, he explains the firm’s new tie-up with Palo Alto Networks (which Nokia signed with last year) in terms of their close software integration. “The difference it saw with us is that we thought about the architecture from day one,” he says.
“Rather than as an afterthought. Most of the traditional telco architectures being brought into private networks require enterprises to re-do a lot of the security – to put in custom firewalls just for the private network – as well as additional systems to get per-device visibility, like in the rest of their LAN, and to figure out SIM security and device profiling, and so on. All these require new custom tooling [in telco-bred systems]. It is like the Wi-Fi industry 20 years ago – when there were a few wireless security specialists, which eventually just became features in Cisco or Aruba. We are going through the same transition now with private networks.”
Celona’s partnership with Palo Alto Networks will be on-display at MWC at the end of February. Shah says: “It’s about end-to-end security, especially in industrial networks. Because a lot of large industrial enterprises have moved into true production scale [with private 5G] over the last six-to-nine months, and that has come with a hyper-increased focus on cybersecurity. We have been getting that feedback consistently from customers – to say they want this security architecture to work in the context of what they already do. So a partnership with a leader like Palo Alto Networks is an appropriate step.”
The other talking points for Celona at MWC will be neutral-host networks, as per the CBRS offering with SHC and AWS (“the three of us will have a few panels and discussions, talking about what all of that looks like for the healthcare industry”), and potentially a go-to-market private 5G deal (“just not sure when the ink will dry”) with a non-US operator (probably UK-based, and probably bleep). Anything more of Celona’s production-scale customers, or verticals? Shah responds: “We are heavily focused on the Fortune 500. Private networks is still a big boys’ play; it is not a mid-market play by any stretch.”
He continues: “The main verticals – no surprise – are oil-and-gas and petrochemical refineries, which represent the most active sector right now, where we are adding one every week. And then it is manufacturing of all types – of auto parts and supply-chain components, food and beverage, pharmaceuticals. And that goes for both their plants and warehouses. Which bleeds into a third group, comprising retail and logistics. Which, again, is less small-retail, where the value proposition is not so obvious, and more big-box retail and warehousing. The fourth tier is outdoor construction sites, where more-temporary networks are required.”
It has just signed with UK-based commercial building and construction group CLARIS, he says. The firm’s Fortune-500 base is buying in the US and Europe, and deploying across the world, he notes. “They are taking us to places like India and Southeast Asia for deployments. Which was the reason we made such a push last year to have a portfolio that can be deployed anywhere in the world,” he says. Separately, he (invariably) rejects the sticky narrative around CBRS that shared/private spectrum has failed to deliver cellular coverage or innovation. “Look, there are a lot of vested interests,” he responds.
“I interpret almost every comment about the efficacy of CBRS as part of a lobbying agenda around future spectrum initiatives. Because CBRS is working just great. Nobody has failed to solve a real tactical problem in CBRS. It was never meant to be licensed spectrum; it was never meant to replace carrier spectrum. So there is no point applying those heuristics to it. But for private networks, it is doing a phenomenal job, and has lots of headroom. CBRS has proven cellular can play a much broader role than just the public macro network. All the negative comments are just to stop more such alternatives opening up.”
Final question, to go back to the start: does the reduction of hype and noise pose its own problem for a company like Celona, a relative unknown in enterprise circles, which requires the buzz to start the conversation – and to build the buzz as well? “Yes, potentially. Because sometimes these things become self-fulfilling prophecies – and because big companies, which are needed to grow the ecosystem, start to worry about their investments. You need the whole ecosystem to stay committed.” He tells how Celona has been hosting partner-suppliers and enterprise-customers together, to get the message to stick.
“One of the things we’ve tried to do, with device makers and chipset vendors, is to bring them to the table with large customers. We had a customer counsel in September in Vegas, where we took eight of our largest customers, all of them Fortune 500 enterprises, and we brought in Palo Alto Networks, plus a bunch of others, to sit around a table just so they could hear directly from each other – and they could hear how big this thing is. So, yes, for a young company such as ours, that concern [that the ecosystem stays the course] is one of the big areas of focus – not to let this perception drive a different reality.”
