Enterprises that have deployed private 5G cite both technical and business benefits, but they might not be what organizations expect. See how expectations compare with reality.
We provide market insights, research and advisory, and technical validations for tech buyers.
Published: 29 May 2024
One of the more interesting "new" enterprise networking strategies to emerge over the past few years is the use of private, dedicated 5G technology as an alternative to fixed or Wi-Fi networking.
The basic idea is to take a technology that has been developing over the past decade for mobile services and apply it to address the reach, bandwidth and security issues faced by enterprises. 5G technology is anything but new, having launched in commercial mobile networks more than five years ago. But using it for private enterprise networking is a more recent development that has begun to gain significant acceptance and momentum in the past year or so.
Now that deployments are growing in number, we can assess if private 5G is delivering on its promises and figure out if it's a fad or a trend with staying power.
Private 5G technical expectations
In May, TechTarget's Enterprise Strategy Group completed a study on private 5G adoption to gauge priorities and outcomes from enterprises considering deployment as well as those who have completed deployments. Along the way, we were able to compare how experiences matched expectations, and how opinions on various related issues changed once deployment was completed. What we found were some learnings and outcomes that could be helpful for any organization considering private 5G.
For instance, about half of the future adopters said they had the following technical expectations for private 5G:
Larger coverage area.
Higher device density.
Higher availability.
Greater throughput.
Half of those who had completed deployment indicated that those same objectives had been realized. This is encouraging overall, as experience seems to align well with expectations from a technical perspective.
But one technical area was less aligned. More than half of those planning deployment expected to receive the ability to host multiple cellular providers. Some enterprises might be disappointed, as a much lower percentage of current adopters identified that as a benefit they experienced.
Private 5G business benefits
More significant variations in expectations appeared when it came to business benefits. The majority of future adopters cited the following as their top business benefit expectations:
The ability to get real-time business insights.
The ability to generate new business.
A reality check might be in order here. Those who had completed deployment reported that they realized these benefits at significantly lower rates. The contrast was most striking for large organizations with 10,000 or more employees. Over two-thirds of large organizations planning deployment expected the ability to get real-time business insights. Among current large organization adopters, however, not even one-third reported receiving this benefit.
It wasn't all bad news, though. Respondents indicated some upside surprises in terms of business benefits. For instance, over half of current adopters experienced better productivity, well ahead of levels expected by future adopters. Similarly, over half of those who had completed deployment said they benefited from increased safety, exceeding expectations among those still planning deployment.
The technical side of private 5G is pretty well understood, but mileage might vary when it comes to the business benefits side of the equation.
The bottom line: The technical side of private 5G is pretty well understood, but mileage might vary when it comes to the business benefits side of the equation.
Is private 5G a Wi-Fi alternative?
It's natural to wonder whether private 5G, as a wireless technology, could or should be considered as an alternative to Wi-Fi. The answer drawn from our research is "maybe." Just over half of respondents said they believed that private 5G and Wi-Fi are complementary. The other half were evenly split between those believing private 5G can replace Wi-Fi in certain use cases and those believing that private 5G can completely replace Wi-Fi. These viewpoints didn't change much between groups that were pre- or post-deployment. It will be interesting to watch how these opinions might change in the future as enterprises approach substantial Wi-Fi refreshes, such as moving from Wi-Fi 5 to 6, 6E and 7, and might want to consider private 5G as an alternative.
Is it worth paying more for private 5G versus Wi-Fi? The answer to this question was a resounding "yes" among respondents. When comparing the purchase of a 5G private cellular product or service to a similar Wi-Fi product or service, an overwhelming majority indicated a willingness to pay a moderate or large premium for 5G. Further, those who had already deployed private 5G were more than twice as likely to be willing to pay a large premium, indicating the value experienced with private 5G.
Private 5G deployments are delivering both technical and business values, even though they might not always be the benefits enterprises anticipate. Early use cases -- such as heavy IoT/OT networking applications and remote sites where fixed, wired networking infrastructure does not yet exist -- will continue to drive the current phase of adoption and deployment.
But don't count private 5G out when it comes to more traditional wireless networking. The cost-benefit balance seems quite favorable versus Wi-Fi, particularly among those who have already deployed private 5G and have been able to balance sales and marketing hype with reality.
Jim Frey covers networking as principal analyst at TechTarget's Enterprise Strategy Group.
Enterprise Strategy Group is a division of TechTarget. Its analysts have business relationships with technology vendors.
