Three Factors Holding Back Private 5G

Heather Broughton, the AVP of Service Provider Product Marketing at NETSCOUT, outlines the three significant factors currently holding back private 5G. This article originally appeared in Insight Jam, an enterprise IT community that enables human conversation on AI.

Just two years ago, a study found that 90 percent of CIOs believed private 5G would become the new network standard, and 51 percent of companies planned to deploy a private 5G network by the end of 2024. When considering the numerous benefits that a private 5G network offers—including flexibility, freedom from the limitations of wired, hardware-based networks, and increased speed, to name a few—it’s hard not to get excited about this technology’s potential. So, with that moment now months away, are we really that close to private 5G taking the world by storm?  

More recent estimates predict combined spending on private 4G/5G networks will increase from about $2 billion annually to $7 billion by 2028, or by about 36 percent growth per year on average, with 18,000 private 4G/5G networks expected by 2028. Many analysts are still optimistic about the growth potential of private next-generation networks, but adoption has been slower to catch on than once expected. Why?

Many organizations exploring practical implementations of private 5G face significant obstacles that can delay or diminish the technology’s potential and are reconsidering their position. Among these obstacles are the need to secure limited radio spectrum rights, the need for talent to set up and maintain the networks, and very real discussions among key stakeholders that 5G might offer more cost-effective service than private 4G LTE networks. Addressing and overcoming these obstacles will determine the path forward for private 5G as we look forward to 2025.  

Securing Limited Spectrum Rights. 

5G radio spectrum is a limited resource, with prices varying based on spectrum type (e.g., mid-band vs. low-band). Operators in the U.S. tend to pay a premium globally for rights, and to recoup these costs, some are willing to allow private enterprises to use a portion of their spectrum. Alternatively, enterprises can purchase a government license for their spectrum or use the Citizens Broadband Radio Service (CBRS), a lightly licensed option suitable for private 5G networks and available to CSPs and enterprise organizations alike. 

However, particularly for the largest enterprises with the most requirements for private 5G deployments, such as manufacturers or utilities, compliance with related regulations can slow or prevent deployments. For instance, obtaining a license for a specific spectrum range can be time-consuming and complex. Once the necessary spectrum rights have been obtained, setting up the network equipment without causing interference or other technical challenges is a significant hurdle that potential private operators must navigate amid a shortage of skilled network engineers. 

Identify and Attract Talent to Build and Maintain the Networks. 

Compared with past generations, 5G networks are much more complex to build and maintain. They tend to require a denser network of cells, more complex mapping of coverage areas, and greater network orchestration, among other increasingly technical factors. Even though the 5G market has begun to mature, the telecom industry continues to face a significant skills gap—particularly for employees skilled in construction and cybersecurity.  

As a result, finding and retaining skilled employees who possess these skills is a challenging proposition. Many organizations interested in building private 5G networks will want to look to an outside firm, such as a systems integrator, a preferred service provider, or even a non-traditional cloud provider, to set up and potentially manage their Network as a Service. Outsourcing such skilled labor may be cheaper and more cost-effective in the long run, and given their experience, an outside firm may better understand the latest technologies to help automate network performance and prevent service disruptions.  

Understand the Differences Between 5G Network Slices, Private 5G, and 4G LTE Networks

Before deploying a private 5G network, enterprises must ensure their intended application, timeline, and budget match up. While private 5G may offer superior technology and performance, the complexity involved in setup and maintenance can easily overwhelm traditional IT and networking teams, which need more specialized operational know-how and skills to fully realize the benefits of private 5G.  

For these reasons, it is only natural to consider whether a private 5G network truly makes sense or if a 5G network slice from a carrier or a private 4G LTE network can get the job done instead. If connected devices and related applications do not require ultra-low latency or bandwidth to achieve the organization’s goal, then other types of connectivity like private 4G LTE or even traditional WIFI 6 might be a better choice.  

Alternatively, carriers have come a long way to offer dedicated next-generation slices of their 5G networks, which provide many of the same benefits as private 5G networks. With customized service level agreements (SLAs), enterprises can even achieve many of the unique network performance characteristics sought with private 5G service, including ultra-low latency for sensitive applications. Enterprises may find this is a more cost-effective approach than investing in the expensive infrastructure, permitting, and maintenance involved with building private 5G networks—though they will want to invest in monitoring to ensure they get what they pay and their real-world performance matches SLAs.  

Finally, for the most discriminating enterprises, where privacy and security need to be maximized, private 5G is a huge step up from previous generations of connectivity. Thanks to its higher 256-bit encryption and superior access controls, private 5G may make the most sense in military, industrial, or healthcare applications. Private 5G adoption may not have reached the heights previously projected, and rollouts may have been slower than anticipated. However, by carefully assessing the intended applications and use cases involved, organizations can make smart decisions about their next-generation connectivity investments.