There was some good chat about the drivers behind the surging interest from enterprises in private 5G at Industrial 5G Forum earlier this month. In truth, the same talking points kicked off just about every session, probably, but Canadian network software firm iBwave and US electric utility Oncor Electric Delivery Company, expertly shepherded through an early panel session (actually about ‘ecosystem synergy’) by telecoms research and consultancy firm STL Partners, did a good job to tee-up the whole discussion. Indeed, iBwave neatly listed three drivers at the outset, which might be easily bulleted at the top of this piece, and set the tone for a wider writeup.
But in response to an initial prompt from David Gordon, senior consultant at STL Partners, the first of these drivers out-of-the-hat was a surprise, perhaps: the promise of network consolidation, to standardise and simplify a mish-mash of legacy industrial protocols and technologies. Gordon went to Oncor Electric Delivery Company first with his questions, and Andrew Knepler, a consultant at the firm, managing its rollout of new radio-frequency networks, said technological consolidation is a major draw for the utilities market. He said: “We operate a large volume of narrowband and other mesh systems, which will stay for the time being, but [are alo] not sustainable.”
Consolidation might be considered more like a happy consequence of new private 5G systems, rather than a primary objective. And really, Knepler explained it in the context of achieving better network resiliency (and security, by extension) and enabling greater digital growth – to support a spiralling array of IoT products to drive efficiencies and insights, also related to the distributed power generation, as well as to enable said-resiliency. He explained: “We’re operating many different systems that all have their own… platforms. Moving to a 3GPP system gives added resiliency. It allows us to consolidate, and then also… adds authentication, policy control, and other things we believe will be very beneficial from a cybersecurity standpoint.”
The same question was asked of Nazim Choudhury, director for market development at iBwave, who echoed Knepler’s comments about network consolidation, and offered up a couple of more direct benefits: efficiency and productivity, most directly linked with financial bottom-line returns (), and security (ditto) and safety, both linked as well. He categorises all of these as “no-brainer ROIs”, invariably linked with IoT solutions (“automation and… devices to automate tasks”) For SEO purposes (full disclosure), and for framing the argument, these might be summarised below, as follows (sometimes spilling over into associated benefits), with direct quotes from Choudhury…
1 | Consolidation / simplification
“Consolidation is a huge factor, especially with all these different pieces – different devices, different sensors, and such… Another piece is with enhanced control, especially in dynamic environments where you need a [bespoke] solution for the use cases you are trying to implement.”
2 | Efficiency / productivity
“Efficiency is another key factor. At the end of the day, you [want] an ROI for the efficiency of your different platforms, or for your specific environment. We are seeing this a lot in manufacturing, [and in] settings like mining – where we see these critical no-brainer ROIs… Just by automating AGVs, we’ve seen clients [achieve] 200 percent efficiency gains… [And a] lot of clients are stacking on new use cases after their ROIs are met. So a key driver is these no-brainer cases.”
3 | Safety / security
“Security is always a key factor, especially when starting to automate physical objects that could cause harm… These no-brainer ROIs [and] no-brainer cases are very much [about IoT] and automation… Manufacturing is a big one… for automation – not only with AGVs, but… also with safety devices. Which goes back to mining, too… The ability to take [connected] equipment to locations where it’s unsafe for humans [is] a no-brainer case because of the… safety [aspect]… It really boils down to automation and… devices to automate tasks.”
Knepler picked up the thread on ROI, and exploded-out the complexity of cost-of-ownership (TCO) calculations into the utilities market – where networks are bigger, regulation is sharper, and lifecycles are longer. He commented: “In the utility industry, the cost of entry is pretty high [for] private wireless… [because of] the cost of spectrum acquisition… and the build-out itself. Because utilities are not contained to a facility; we’re talking about tens of thousands of square miles [of network coverage], if not hundreds of thousands. So we’re almost building cellular-scale networks – so the cost is high. So when you talk about ROI, how do you quantify that?”
He noted the stiff regulatory environment (“to make a rate case back to the public utility commission… to recover the capital… on these projects”), before going on to answer his own question – at some length, covering considerable ground – about how to quantify the ROI on massive-scale futuristic private 5G deployments. He said: “There are a couple of factors in the way most utilities are approaching the business case. One is scalability, which is just a raw device count… As the grid becomes smarter, there are an increased number of devices… to monitor and control it – everything from line sensors to sensors that facilitate wildfire mitigation [and so on].
“As distributed energy resources come into the grid… [that growth] is not going to be linear. So in terms of the ROI, you’re looking at [what’s happening in] five years or 10 years. What will it cost us if we don’t build this network? How are we going to connect those devices? How do we keep grid-reliability high if we can’t monitor the system? So that’s the biggest ROI driver – just the growth. But electric delivery is about resiliency. Because if the lights go out, it’s not just detrimental to businesses;it could be detrimental to human welfare… The cost might be higher [to] add resiliency… [but] it’s very beneficial overall. It’s a little more intangible [but it] still factors into the business case.”
The duo made interesting comments about the hype that surrounds private 5G, as well. Maybe we’re talking about AGVs or AI on top of the network, said Gordon. How do you cut through that hype to help enterprises kickstart really impactful transformations? That was the question; Knepler was fairly sympathetic, acknowledging that hype is important to drive interest, but sticking also to the accepted party-line that results are what count. He said: “There’s definitely a place for AI – probably in everything, but especially in networking. A lot of the focus on 6G is… about integrating AI to control the user and control plane… [AI will] factor into private networks as well.”
He went on: “[But] there is a lot of hype, and a lot of buzzwords… [and] we need to remember… a lot of times folks just want to know [if or why] it makes sense for their business? How will it improve efficiency or reduce accidents? It’s okay to talk about the buzzwords, but… you need to link it to some tangible manageable benefit the end user or the operator is going to see. Because the pie-in-the-sky stuff – that it’s going to be AI, and it’s going to be this [and] that – sounds great, but sometimes loses the audience. It’s really important to link technology to a benefit and a return… [Because these are] business people and they’re looking for a return.”
Choudhury chimed in: “It’s about tying the technology back to the benefits. One of the harms with always looking at the shiniest tech is you lose sight of what you’re trying to do [with it]… Enterprises are taking more of a roadmap approach. They’re not just looking at the shiny 5G solution… They are looking to deploy in phases… It’s a much better approach… It is very analogous to software – where you have a long-term roadmap, and you look at short-term benefits while following an overall vision… There’s a lot of tech that could support lots of use cases. Deploying the most expensive solution from the get-go won’t always meet your ROI. It might fall short.”
More coverage to follow. For more on this topic, take a look at Industrial 5G Forum, available on demand.
