Neutral host will be the winner; network slicing will be the loser (Celona on 2022)
2021 was a wild one for the 5G market. It was kind of like a roller coaster; exciting and ultimately rewarding, but also filled with a lot of unexpected twists and turns. Particularly for applications like private 5G, the markets became something of a battleground for a diverse set of competitors, each with their own business model and agenda.
Even as this segment continues to evolve, we definitely gained enough insight to see the way ahead for this burgeoning space.
Neutral host will be the killer app
Firstly, the ‘neutral host’ model will be the ‘killer app’ for private mobile networks. Neutral host models, unlike traditional models, allow multiple parties – both private and public – to use the same network that may be managed by a third-party MSP or the enterprise organizations themselves. Now, a single network can be shared among multiple parties to reduce costs and management overhead.
When you’re looking to scale your cellular network to cover miles instead of meters, your project costs can balloon in size. However, by leveraging existing cellular networks as neutral hosts, wide-scale coverage for your service or private network becomes a lot easier. Being independent of a specific cellular operator or network plan gives enterprises as well as end-users greater flexibility and functionality in places that were previously not possible.
A neutral host network will enable multiple MNOs to extend their services – effectively eliminating the need for Distributed Antenna Systems (DAS) that are operationally expensive and hard to maintain, to extend MNO public cellular coverage indoors. This same principle is true when you look at different mobile operators trying to serve an overly crowded area, such as a shopping mall.
Without a neutral host, each network operator will have to deploy their own equipment, resulting in higher all-around costs and energy consumption. This can lead to wasted space with duplicate equipment and higher noise on the spectrum.
Network slicing will fail for enterprises
Secondly, major telcos will attempt to make ‘network slicing’ a thing for the enterprise, but fail due to the cost, security, and complexity of their approach. Network slicing represents one of the most compelling capabilities of 5G, and for the enterprise, the ability to share spectrum makes up a good chunk of the value of a private mobile network.
Assigning different priorities to devices, applications, users, groups, and areas via slices of bandwidth fits perfectly with most enterprises’ policy-based infrastructure. The problem is a telco network can apply different slices to different enterprises connecting to its core network – but not among different application types and device groups within the same enterprise.
They are simply not as sophisticated in their current approach to fully translate cellular wireless to existing enterprise network configuration and policies. It’s our prediction that the requirement to better understand enterprise IT needs, combined with high costs put forward with current alternatives, will impact their future plans within this market.
We will have to check back in 12 months to see if I am right. But no matter what happens, we’re guaranteed to see a year of growth for private 5G in 2022. The board is set and the players are ready to compete. The winners will be the competitors that map closely to these market trends.