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Kenton Williston: Welcome to the IoT Chat, where we explore the trends that matter for consultants, systems integrators, and end users. I’m Kenton Williston, the Editor-in-Chief of insight.tech. Every episode we talk to a leading expert about the latest developments in the Internet of Things. Today I’m exploring the rise of private 5G networks with Richard Webb, Director of Network Infrastructure at analyst firm CCS Insight.

With every new generation of cellular technology, the hype is always there. But with the rise of private networks, 5G is set to be a true game changer for manufacturers and other businesses. To successfully take advantage of everything 5G has to offer, you need collaboration between telecom operators, cloud service providers, systems integrators, and even enterprise solution providers.

In this podcast, we’ll talk about these partners and their role in the 5G ecosystem, the reasons enterprises should deploy private 5G networks in the first place, and the differences between Wi-Fi and 5G. But before we get started, let me introduce our guest. Richard, welcome to the show.

Richard Webb: Thank you very much. Pleasure to be here.

Kenton Williston: Can you tell me what CCS Insight does and what your role is there?

Richard Webb: Sure. CCS Insight is an industry analyst firm focused on a range of different emerging digital technologies. Everything from AI, machine learning, automation, analytics, mobile network infrastructure, enterprise, digital transformation, IoT, smartphones and mobile devices, including wearables, VR, AR, a range of different technologies. And really a lot of the work we do is consulting on the market opportunities for the intersectionality of those different emerging technologies. We’re a relatively small firm based in the UK, but with the global remit. So we look at markets across the whole world. We serve a customer base of mobile operators, cloud service providers, network equipment providers, software solution providers, everything in between.

Kenton Williston: I look forward to getting into that, but I’m curious. Actually earlier in my career I did a little bit of work as an analyst myself. So I’m curious what got you into this line of work and what you did before your current role.

Richard Webb: Okay. So I’ve been an industry analyst for over 20 years now, but I started my career actually working in entertainment. I was running a venue and it held a number of different corporate events, as well as public entertainment. One of the corporate events was a conference, a business conference, focused on technology. And I got speaking to the organizer who was putting the show on and hiring our venue. And I got really interested in that as a possible career. I jumped lanes as it were, and got into a conference organization and media company and got put into the telecommunications division. So a lot of the European telecoms markets were liberalizing. Really interesting time, GSM, 2G mobile networks were just beginning to proliferate around the world. We were all getting mobile phones for the first time. A huge range of business opportunities and lots of dynamism there to investigate. And that evolved into more in-depth research. And I sort stepped sideways into the analyst environment. That was a very natural move. And I’ve been an analyst for over 20 years.

Kenton Williston: You know that history where you started with the emergence of 2G and the changes in the European landscape is really reminiscent in some ways of where we are now in the telecom space, right? Every G that we’ve experienced so far has been the one that’s really going to revolutionize everything, right? The hype, the hype’s always there, but I think in a lot of ways, 5G really is a pretty meaningful step change. And especially for the world that we care about here at insight.tech, which I should mention is an Intel® publication. You know, 5G is incredibly important for the Internet of Things. I would love to hear a little bit from your perspective, what in particular is driving the trend toward private 5G networks. Because this is something that’s relatively new. Private networks really haven’t been a thing before now. And like I said, this is something that’s going to be incredibly important for the Internet of Things. What are you seeing in this area?

Richard Webb: Well, firstly, I think you’re absolutely right about 5G. I think previous it’s iterations from 2G to 3G. And then 3G to 4G have really been about developing mobile communications, but on a fairly straight line. Adding data to voice and then improving the speeds and feeds of that data capability in particular. But you come to 5G, I think absolutely you’re right. This is a real game changer simply because 5G brings along new capabilities. It’s not really just about faster broadband. I think that’s very much how it might be presented to the consumer market, but I think it means different things to other markets, particularly enterprise and industrial vertical sectors.

And I think this is really where we get to see the kind of full-flavored 5G really reach fruition. And that’s because some of the capabilities that 5G had, yes, some of those are around better capacity, but also lower latency, kind of emerge at the same time as the evolution of other digital technologies, such as multi-access edge computing, such as big data analytics, such as AI and machine learning. And really the combination of 5G with those other digital capabilities that makes it more powerful.

5G is a real foundational infrastructure and service environment for those other capabilities. And when you put those into combination with each other and other technologies as well, you get a much richer environment. And I think that’s something that you’re going to see industry really take advantage of. Early-phase 5G was very much around—non-standalone 5G infrastructure that really was kind of a slightly better iteration of mobile broadband. As we get into the second phase or the later phase of 5G, it’s going to be built around standalone. And there’s a lot that’s happening, the core infrastructure there that really kind of releases some of those capabilities and some of that ability to interact with those other technologies. When you look at private 5G networks, you’re looking at an industrial environment that’s already going through its own changes. Those industries, those enterprises are going through their own digital transformation.

So really they’re putting more and more of their processes into the cloud. They’re doing a lot more that’s data driven and IT-centric and computing-centric within their own processes. And 5G comes along at a very opportune time, because it can really play a role in supporting that digital transformation in enterprises. And also accelerating that by bringing those other digital capabilities to an enterprise. It could say, “Hey, there’s possibilities here that you haven’t ever had before.” So there’s all, all sorts of new use cases that are reemerging for enterprise and industrial verticals built around that 5G connectivity as a kind of means of access, those other digital capabilities I was talking about. Particularly edge computing, which is incredibly powerful.

Kenton Williston: Yeah, absolutely. And like you said, the overall trajectory of 2G, 3G, et cetera, has been greater bandwidth than the more consumer facing things. And I think on the 5G networks there are flavors. Now granted these sorts of things were starting to come into fruition with LTE, but much more fully fleshed out in 5G, where there are flavors of it that are really designed specifically for things like industrial environments, where the emphasis is not so much on having huge, fat pipes to pump the latest of your HBO Max show or whatever it might be. It’s more about having low latency connections to an awful lot of devices, which is really perfect, like you said, for an industrial setting.

Richard Webb: Yeah, absolutely. I think once you stop thinking in terms of the connected device being attached to a human necessarily, and being attached to a machine instead, and gathering data that is related to the activity that that machine is there for, then you’ve got different data streams that could be maybe only sending small pieces of data, but scaled up over tens or hundreds of thousands of data points, of connectivity points, within an organization. These could be sensors that are just relaying one single piece of information, but on a very regular basis as a small part of a very complicated manufacturing line, for example. Or a very complicated set of different processes around lots of different types of machinery within a smart healthcare facility, for example, or a smart grid environment. They’re very specialized environments with very different requirements to what was capable even or what was even possible over 4G. But the different devices and the different data streams they’re capturing offer a number of very, very interesting, but very sophisticated and often complex use cases.

There’s a great deal of possibilities, but there’s a great deal of requirements as well. And this is where 5G really plays its ace. Because it’s got capabilities that, yes, are around capacity and latency, but it’s the mobility bringing that into an industrial environment where previously those machines were tethered to wired networks, for example. It’s the flexibility that 5G offers in terms of moving machinery around its actual mobility within a location as well. Its interrelation between other network technologies, like Wi-Fi, can be a very useful capability for 5G as well. Of course, it’s that nationwide infrastructure, that mobile network that goes beyond a single enterprise premises that is another dimension to it as well. So there’s an awful lot that 5G can bring to the table, but these are very demanding, very exacting requirements. And that is not just shaping the technological landscape, but it’s shaping the commercial landscape around private 5G networks.

Kenton Williston: Yeah, absolutely. And so you touched on the idea of the relationship between 5G and Wi-Fi, and I’m curious where you see that positioning exactly. And especially as Wi-Fi itself continues to advance. We’re seeing Wi-Fi 6, for example, coming out. Where do you see the interface between those two technologies? Why would you use one versus the other?

Richard Webb: Yeah, it is a good question. And it’s something that I’ve seen quite a bit of debate around. I don’t really see it as being a zero-sum, kind of one or the other standoff between Wi-Fi and 5G. Wi-Fi is incredibly broadly deployed within enterprises. I don’t think it’s going to go away, and I see no reason why it should go away just because 5G becomes an option. There’s been a very progressive and coordinated conversation between Wi-Fi development camps and mobile development. So Wi-Fi and 4G, 5G are not strangers to each other. These are technologies that can now talk to each other. They can be integrated within a network, or they can operate as two separate simultaneous networks. And this is how I think we’re going to see both of them coexist within an enterprise location. Wi-Fi is very well deployed. It scales very well indeed.

It may be better suited to non-critical communications because of the contentious nature of Wi-Fi. You can have Wi-Fi get a little bit overloaded when you’ve got too much going on that network. It may not be suited to mission-critical connectivity. When you have 5G, that’s much better suited to that mission-critical capability. You connect a device, you can typically, if not guarantee, then you can work within performance parameters to a much greater and more consistent extent. So it’s not necessarily that 5G is better than Wi-Fi. And certainly Wi-Fi 6 have their own capabilities that make them very applicable in many use case environments. It’s just that 5G can be better at certain things or in certain scenarios. If you think in terms of how best to get performance out of Wi-Fi and how best to get performance out of 5G, think of them as complementary. It’s actually when you’ve got both of them working simultaneously, they’ll help the performance of each other.

Kenton Williston: One of the things that I think comes to mind that’s really important about the distinction between these two technologies, beyond all the points you’ve been making, is just the fact that Wi-Fi is so familiar, right? Whereas, cellular technologies to many organizations are a new idea. It’s not something they’ve broadly deployed, not something they’re IT department is necessarily particularly familiar with. And that makes me curious about how organizations might go about implementing a private 5G network. Is this something that the IT team can develop expertise on in house? Is there a role here that they should be looking to partners to bring in to deploy these technologies? How do you see that playing out?

Richard Webb: 5G is almost like a reset opportunity for telcos to reshape their game for the enterprise and industrial verticals. To think differently about how they position, not just their services, but 5G as a kind of technology platform within enterprise. And bringing on board all those other capabilities, some of which enterprises and industrial verticals are already grappling those capabilities like edge computing, AI analytics, and so on. So 5G can really harness that and be an accelerant of those digital technologies, fueling the transformation that’s already in play for a lot of enterprises. Again, there’s a lot they have to do on the commercial side, not just figuring out the right way to approach the market and these channels to market, but really being open about what their capabilities are. And here is where I think the market environment is going to get very, very different for mobile, and really sort of based around that private 5G opportunity.

It’s around telcos being honest that they can’t do everything for everyone, particularly within an enterprise environment. That itself is becoming more complex, more demanding in terms of its digital transformation processes, its potential use cases, and so on. They’ve got to put in place an ecosystem of solutions. That’s both network hardware and software. Involves cloud service capabilities, could involve systems integrators, could involve players with deep vertically specific knowledge for some of those markets that telcos want to address. And figuring out that value chain is by no means an easy thing to do. It’s almost something that you have to do on a customer-by-customer basis, or certainly on a vertical-by-vertical basis. And telcos might have different strategies to approach different verticals. In one vertical, let’s say healthcare, they may have a good customer base. They may know a lot about the technology needs of that healthcare industry.

And so they feel they could be the direct-touch lead for a particular healthcare-transformation environment. Pick a different vertical and that telco may not be as strong. So it may take a different approach, being more of a sort of wholesale provider, but the lead could be a cloud partner that is the direct interface with the customer in that particular environment. Or it could be a network-equipment provider when you see offers from the likes of Erickson and Nokia, in which certainly Nokia has a direct-touch approach amongst a number of different strategies for reaching out to different vertical environments. It isn’t necessarily something that the telco has to front up, but they do have to play a part in positioning that solution for a particular customer as part of an ecosystem of solutions that’s going to pull in resources from a number of different plays. So there’s a technology component to it, but there’s very much a commercial component to it.

Kenton Williston: Yeah. One of the things that was really interesting in your list of potential partners and who is involved in the ecosystem are the cloud service providers, right? These are not folks who would traditionally think of having a role in telecom networks. So I’m thinking here, let’s say the Amazons, the Googles, the Microsofts, what role do these cloud providers have in these private 5G networks?

Richard Webb: I think these providers like Amazon Wavelength services, like Microsoft Azure, Google Cloud, and so on, have it incredibly important roles to play, and a great opportunity within the private 5G network environment. Many of them have existing relationships with enterprises, partly because those enterprises are already undergoing their own digital transformation. A lot of that is revolving around the cloudification of their own processes. Their process is becoming more data-centric. And so they’re already customers of those cloud providers. And secondly, because I think there’s a scale and a reach to those cloud providers that can often outperform or out-scale what a telecoms’ operator can potentially offer. Don’t forget these are global organizations in many cases. And whilst yes, an operator has 5G infrastructure, those cloud providers have a great deal of investment in infrastructure of their own servers and data centers and so on. And a great range of skill sets and a flexibility that’s very powerful.

It’s not really a case of them usurping the operators, or at least I don’t believe so. But I do see from some operators that I’m speaking to there is a little bit of tension around exactly what the role of the cloud providers are, given their scale and reach. But I think it’s again about that powerful combination of different service providers in the mix. And so I think there’s still quite a bit to be figured out with regard to telcos and how they interact with those cloud providers. But I think there is a growing market, a growing pie, if you like, that there’s room for everyone to coexist, so everyone can get a piece of that pie.

Kenton Williston: Yeah. So on that point, it’s not just the telcos, not just the cloud providers, but there are also enterprise-solution providers, the likes of IBM, Dell, and HP, who are also getting involved in this private 5G space. Can you tell me a little bit more about what role they play in this ecosystem?

Richard Webb: I think they’re also incredibly important. Many of these organizations will have very longstanding relationships and reputation within the enterprise space. You mentioned IBM, that’s got decades of heritage as an enterprise-computing provider. Others like HPE, Dell, absolutely the same, and have been very progressive in their moves into the telco environment as a solution provider. A lot of them, particularly HP, very active in 5G-core environments leveraging their software capabilities. They’ve already been moving in this direction.

Private 5G networks is really just an extension of that strategy to be part of telecommunications in a networking sense and not just in a devices sense. It’s still about access to computing and processing capabilities, but it’s much more in tune with the virtualization of networking. I don’t see that they’re any more a dangerous threat or a predator in this environment. I see them having a role that is valuable to the market alongside 5G network operators, alongside those cloud providers. Those IT providers have got heritage with mobile. And what that really means is often they have deep knowledge of how those different vertical sectors are evolving, whereabouts they are on their roadmap of digital transformation. That’s a really important piece, if you like, of the jigsaw puzzle in putting solutionstogether.

Kenton Williston: Yeah, for sure. And of course there’s one other element of this ecosystem I think is going to be quite important, and that’s from the enterprise-network-technology providers. I’m thinking here, for example, of the Ciscos of the world. Can you tell me where they fit into this? And really, I suppose, not just from a 5G perspective, from the larger perspective of 5G, Wi-Fi, and everything networking that’s going on in the enterprise space.

Richard Webb: You know, this is meat and drink in some ways to Cisco. It’s just, yeah, figuring out what their strategy is and where they fit. And I think that’s where a lot of the different players are still figuring it out. It’s not so much, have we got the right technology, but where do we fit best to offer most value in that value chain? Where can we build business for ourself? For Cisco, it may well be around the integration capabilities sitting at the middle of telco and enterprise networking, having capabilities across that whole gamut of technology intersection, if you like.

There’s a number of different ways they can position within this market. But really, I don’t think it’s necessarily even right to think of private 5G as a single market. I think it is going to be a very diverse market, perhaps according to industry sector. But you can be one thing to one market and you can be a different thing to another market. And it’s really sort of looking at your channels, your opportunities, your customer base, your partnerships, and so on. And figuring out almost on a case-by-case basis, what is our best opportunity? Who can we work with? How are we going to put solutions together and run it on a project-by-project basis.

Kenton Williston: You’ve mentioned quite a few times, and I absolutely agree with you, that exactly what private 5G networks will look like will depend entirely on the context, not just the industry that you’re talking about, but even the particulars of the given organization’s needs. It’d be great to talk in a little bit more detail about a specific example, and I’ll point to the report that we’ve got hosted on insight.tech, and I’d encourage our listeners to go over there and check out the CCS Insight report on 5G private networks. And in that report there’s some discussion of deployment that’s happened with Exor in one of their manufacturing facilities. I’d love to hear from your perspective what is significant about that example, and what takeaways folks can have from it. And I suppose even really what did Exor do in that deployment exactly anyhow?

Richard Webb: Exor is a technology manufacturer. And within its Verona smart-manufacturing facility in Italy it has covered that with 5G as part of a private mobile network environment in partnership with Italian mobile operator TIM, and also in partnership with JMA wireless and Intel. And what it’s done is not just operate a 5G private network for its own processing capabilities, but has built a 5G smart lab environment. It’s actually testing new use cases within its own network environment that it can then deploy within its own network, but also present as part of its solution suite to customers as well. It’s opened its door to allow other companies into its 5G lab, to explore how they can interact with industry 4.0 wireless applications based on 5G.

It’s not just an example of how to deploy it, but it’s really a sharing partner for those learnings as well. It’s an incredibly powerful environment to get a sense of not only how use cases are deployed within a smart-manufacturing environment, but to experiment with what more could be done. Particularly where you are looking at the interface between industrial PCs and human machines, and so on. A lot of rich potential coming out of there. And I’m really interested to see how that story evolves over time.

Kenton Williston: Yeah, likewise. There’s a lot of exciting things happening in that example. And again, I’d really encourage our readers to go check out the full report. Not only for more details on that example, but more details of all of your thinking on the future of private 5G networks. We’re getting close-ish to the end of our time together. I want to leave a little bit of time here just to see if there are some particularly important things that we may have wanted to cover from your point of view.

Richard Webb: Thank you very much. One thing I’ve talked about a little bit in some of my responses has been around complexity and around the sophistication of use cases and the high demand that that can put on connectivity and data processing and so on. And how 5G can be a platform for a combination of digital technologies. And that sounds great, but you need those technologies to be integrated. This is a complicated environment. So what I think is important for the acceleration of 5G private mobile network adoption are solutions that can cut away some of that complexity. And I think we’re beginning to see some of that addressed in some recent announcements. I’m thinking particularly of AWS’s reinvent that took place recently at which it launched its private 5G solution service. And really this was about providing, if you like, a one stop shop, plug-and-play 5G network as a service. To present that directly to enterprises in conjunction with 5G telco partners.

That’s probably one example of an attempt to cut through some of that complexity, make it really easy for enterprises to pull the trigger and green-light 5G private mobile network adoption within their organizations. It’s really about that collaborative environment on the technology side, and having a commercial framework that enables that. That is what’s really powerful potentially, but you’ve got to get 5G adopted into the enterprise first, and to do that, simplicity and reducing complexity is going to be very, very important.

Kenton Williston: Yeah, absolutely. And I think one thing that’s worth pointing out here, as we mentioned briefly some of the enterprise solution providers like IBM, Dell, and HP, and I think one of the things that’s important to note here is that it’s not just about the private 5G–specific solutions that these folks are starting to introduce, although that is very important. But just the wider sphere of how these folks are starting to deploy server technologies and edge-computing technologies that are well suited for being out on a factory floor, or being in other sorts of edge-computing use cases. And this is very much an integral part of being able to make use of these private 5G networks.

Richard Webb: Yeah, I’d agree. And that’s why I think the likes of Dell and HP and IBM are very powerful partners for enterprise within this environment. Because they’re already partners. They’re already holding the hand of their enterprise customers as they go through this digital transformation journey. And don’t think of private 5G networks as something separate. Private 5G is really part of that digital transformation. It doesn’t exist as an island. It’s in many cases a very natural place to arrive at as part of that ongoing process of evolving your data processes within an organization. It’s simply a better way of connecting those different parts of data functionality with processing and computing capability over a resilient and flexible network. So it’s really kind of a natural evolution. And that’s why I think it’s absolutely right that the likes of HPE, Dell, IBM, and others are very much integral to this adoption of private mobile networks. They have a role to play because they’ve already been playing that role, and that’s not going to change.

Kenton Williston: Absolutely. I think this is a great place for us to wrap things up. Richard, this has been a really fascinating and wide-ranging conversation, and really appreciate you sharing your thoughts with us.

Richard Webb: Thank you very much. Pleasure to be here and thank you very much for having me.

Kenton Williston: And thanks to our listeners for joining us. To keep up with the latest from CCS Insight, follow them on Twitter at @CCSInsight, and on LinkedIn at CCS-Insight.

If you enjoyed listening, please support us by subscribing and rating us on your favorite podcast app. This has been the IoT Chat. We’ll be back next time with more ideas from industry leaders at the forefront of IoT design.

This transcript has been edited by Erin Noble, proofreader.

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