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5G-for-the-enterprise

EBOOK
5G for the
enterprise
An examination of the industrial adoption
of next generation connectivity in the UK
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5G for the enterprise
Introduction
The promise of 5G
The COVID-19 pandemic has initiated extensive
discourse around new ways of working and the pace of
digital transformation has rapidly accelerated for many
organisations. In turn, this has reinvigorated consideration
of a range of emerging technologies that will allow UK
commerce, industry and the public sector to modernise
and to provide a much-needed boost to productivity. Chief
among these transforming technologies is 5G.
In many sectors, the imperative of digitalisation is keenly
felt. For the Energy & Utilities sector, major changes to
the nature of the energy system are necessitating the
development of improved connectivity to support smart
grids and more active management of networks, with
regulatory oversight driving this.
For Retail firms, the satisfaction of the customer is inevitably
a key driver in the decision to adopt 5G technology, with the
promise of more personalised shopping experiences, more
efficient systems for stock replenishment and improved
pattern recognition of shoppers all on the horizon.
In the Transport sector, the prospect of smart and efficient
logistics, autonomous vehicles and the real-time monitoring
of passengers, freight and infrastructure make for huge
appeal when considering 5G use cases.
Meanwhile, Manufacturing firms harbour ambitions to build
smart supply chains, increase use of process automation
and build 5G technology into their own finished goods.
The research also identifies which organisations are in the vanguard of
5G deployment; the cohort of UK organisations that are ‘5G Leaders’
by virtue of having both high appetite and suitability indicators for 5G.
This report seeks to understand how these leading organisations are
thinking and behaving differently about the opportunities presented by
5G and what the rest of the market may be able to learn from this.
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Within Financial Services, the enabling of Mobile Edge
Computing (MEC) architectures are perceived as being
relevant, possibly linking with novel approaches to
high-frequency trading or local processing of price signals.
Applications key for the Government and Public Sector are
in security, surveillance and public safety.
The aim of this report is to understand the current,
on-the-ground reality for enterprises and organisations in
those sectors that stand to make use of 5G technology. It
comprises results from an independent survey of over 200
respondents across UK organisations in a range of sectors
with 250 or more employees. The research was conducted
in late 2020 and early 2021 by B2B International, a leading
independent market research agency.
As part of the investigation into the current opportunities
available thanks to 5G, the following key topics were
explored:
• Evaluating UK business appetite for 5G
• Quantifying potential levels of investment in 5G
• Identifying ways of boosting adoption
5G for the enterprise
The 5G opportunity
within UK industry
Appetite, sustainability and value
The research found that more than two thirds (68%) see this as
a high priority compared to other communications technology
investment, with the majority (63%) expecting to make significant
investment in 5G technology in the next one to two years.
As demonstrated in Figure 1, the data also shows that some
of the verticals surveyed appear to be blazing a trail when
it comes to exploring the possibilities of 5G. Here, those in
Energy & Utilities, Retail and Transport appear to be the furthest
progressed, as measured by the proportion that have already at
least initiated some form of proof-of-concept:
FIGURE 1:
Sector-specific progress toward 5G adoption
Early stages but no specific plans / timelines
40%
36%
24%
32%
28%
29%
25%
40%
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Proof of concept stage
24%
20%
13%
28%
38%
52%
50%
Financial
Services
Public Sector
40%
64%
40%
40%
46%
Retail
Transport
Manufacturing
20%
Energy &
Utilities
28%
Planning
36%
8%
Media
Professional
Services
5G for the enterprise
When these statistics were projected across all sectors
studied, the research found that this could equate to
almost £5bn of annual investment in 5G. Figure 2 below
breaks down what this could look like across the key
sectors included within the research:
With the majority of the market looking to invest in next
generation connectivity within the next couple of years,
the research also suggests that substantial proportions
of business IT budgets could be directed towards 5G and
its associated technologies.
FIGURE 2:
Potential annual investment in
5G by UK businesses (£m)
Professional Services
1133
Retail
946
Financial Services
814
Manufacturing
Public Sector
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490
381
Media
288
Transport
267
Energy & Utilities
244
£4.6bn in total
across the sectors
5G for the enterprise
Respondents were asked a series of questions around
the level of appetite for 5G within their organisations
and the perceived suitability for it to solve known
connectivity challenges. Here, identified use cases and
benefits were explored, as well proposed timescales
for implementation, progress to date and perception
against alternative solutions.
From this, it was possible to calculate that 16% of
large UK organisations can currently be considered as
‘5G Leaders’ – those demonstrating both the highest
degree of enthusiasm for the technology, as well as the
greatest practical consideration of relevant use cases.
As such, one might expect leaders to be closer to the
proof-of-concept stage in their adoption programmes.
At the opposite end of the spectrum, almost half (47%)
of UK larger organisations are ‘Starters’ in that either
appetite or suitability is currently a little lower. The
remaining 37% of firms are ‘Followers’ (see Figure 3);
those perhaps waiting to evaluate the way in which
Leaders innovating with the technology do so with the
greatest success and efficiency, before adopting at pace
with the benefit of reference points.
FIGURE 3:
Split of UK businesses based on 5G appetite and 5G suitability
Appetite score
HIGHER
SUITABILITY
More use cases for 5G
seen as relevant and
more communications
challenges perceived as
being solved by 5G
Suitability score
Low
Lower
Mid
Higher
5G Leaders
(16%)
Highest
High
5G
Followers
(37%)
Higher
Mid
Lower
Low
High
Highest
5G Starters
(47%)
Percentages are the split of companies participating in the survey
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HIGHER APPETITE
5G higher priority than
other communications
investments, likely to
make investments sooner
and more likely to have
PoCs underway
5G for the enterprise
What makes a 5G Leader?
Characteristics of those innovating and where to find them
Businesses that have a culture of being more ambitious, early adopters of
technology are more likely to be 5G Leaders. However, this relationship is not
absolute. Indeed, as Figure 4 shows, there are many early adopter-types that
may not be when it comes to 5G:
FIGURE 4:
Split of 5G maturity by overall technology adoption disposition
Quite / very ambitious attitude to tech adoption
More cautious / neutral attitude
60%
32%
40%
30%
28%
10%
Starters
Followers
% falling into each maturity group
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Leaders
5G for the enterprise
When comparing all segments (Leaders, Followers and Starters), there were
clear indications of what makes Leaders different. First, 5G Leaders had a
much stronger knowledge and appreciation of 5G and related technologies
such as IoT and SD-WAN (Figure 5). Linked to this was a firmer appreciation
of the transformative power of 5G. 69% of Leaders agreed that ‘5G is a truly
transformative technology that is more than just an upgrade on 4G’, compared
with just 43% of Starters.
FIGURE 5:
Strength of knowledge of 5G and related technologies
IoT
63%
39%
25%
38%
55%
75%
47%
33%
5G
Leaders
69%
Followers
Starters
SD-WAN
% with very strong knowledge and understanding of each technology
5G Leaders also tended to:
• Prioritise digital transformation (72% mentioned this as
a top business priority versus 47% for Starters)
• Be focused on improving business resilience (56%
mentioned this versus 39% for Starters)
• Benefit from strong senior technology leadership, with
50% of these organisations identifying such roles as key
influencers in driving decisions around 5G adoption
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5G for the enterprise
A final characteristic of 5G Leaders was their tendency
to have more optimistic expectations of short-term
profitability. 37% of 5G Leaders expected considerably
higher profits in five years compared to just 12% of
Starters. This hints towards the link between 5G and
bolder, more transformative business plans.
5G Leaders also looked to be strongly considering
building out edge computing approaches (Figure 6),
including MEC. This will be to enable functions such as
remote monitoring, security and more effective use of
IoT telemetry.
FIGURE 6:
5G use cases by segment
Leaders
sensor data, incl
ML
% regarding the following 5G purposes / use cases as being potentially relevant to their organisation
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63%
39%
27%
43%
50%
66%
23%
50%
crime
prevention
33%
17%
21%
25%
66%
63%
49%
39%
27%
27%
42%
33%
26%
25%
43%
66%
38%
49%
and apps
72%
Improving
access mobile Vir
Faster adoption
Security, Virtual
Remote
Enabling
Security,
Remote controlRapid
of
Enabling Mobile
Reality control
surveillance,of cloud
assets
processingEdge
/ Computing
surveillance, (VR) and
of assets to edge devices
edge
public safety &
(MEC)
Augmented
infrastructure analysis of IoT public safety &
computing
crime prevention
Reality (AR)
66%
Rapid processing
/ analysis of IoT
sensor data, incl
machine learning
75%
27%
Faster adoption of
cloud infrastructure
and apps
38%
72%
Leaders
42%
Followers
26%
Starters
75%
Followers
43%
Starters
(MEC)
5G for the enterprise
When applying this 5G leadership framework to different vertical
markets (see Figure 7), it becomes clear that businesses in the Transport,
Energy & Utilities and Media sectors are markedly closer to being 5G
Leaders. This is driven not just by higher levels of appetite for the
technology, but also by relevant use cases being more readily identifiable
for these sectors, such as those referenced in the introduction of this
report. It is worth noting that these early mover organisations for 5G are
themselves responsible for modernising key aspects of the UK’s
infrastructure – including the example of the Energy & Utilities industry
identified earlier.
Meanwhile, businesses in the Manufacturing sector are currently more
likely to be ‘Follower’ organisations in terms of 5G adoption, many
potential use cases for the technology are recognised by decision
makers. Unlocking the substantial annual investment opportunity in this
sector is likely to require careful support from the telecoms industry and
service provider partners. Likewise, Professional Services firms will have
a vital role to play in assisting organisations across a range of sectors to
adopt 5G-enabled business models.
Appetite Score
LOWER
HIGHER
FIGURE 7:
LEADERS
Manufacturing,
490
HIGHER
Sector opportunities based on 5G
appetite and 5G suitability
Transport, 267
Suitability Score
Bubble sizes show the potential
annual investment in 5G by UK larger
organisations (in £m)
Energy &
Utilities, 244
Public Sector, 381
Media, 288
LOWER
£
STARTERS
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Financial Services,
814
Retail, 946
Professional
Services, 1,133
5G for the enterprise
Accelerating and optimising 5G adoption
How 5G Followers can step up
5G Followers comprised 37% of survey respondents.
With this group still expressing healthy but more
moderate levels of 5G appetite and suitability, 5G
Followers would benefit from reinforcement of the
benefits 5G offers, and remediation of any slight
apprehensions that may remain. Figure 8 shows that
5G Followers were more likely to be organisations that
are custodians and processors of ‘extremely sensitive’
types of data, and so need to feel especially assured
about the security of any new technology.
Follower organisations also appeared to face greater
challenges in not knowing where to turn in the supplier
ecosystem for help and advice. This will be especially
important to address, given that a significant number
of Followers (57%) report having important knowledge
gaps in terms of the applications to which 5G is best
suited.
FIGURE 8:
Characteristics of 5G Followers
Starters
Starters
Followers
Followers
Leaders
Leaders
64%
36%
18%
36%
66%
57%
26%
47%
26%
33%
41%
18%
% Processing
“extremely sensitive”
data
“The 5G supplier ecosystem
is too complex - don’t know
who to turn to for advice”
% agreeing with each statement
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High priority knowledge gap:
Understanding applications
where 5G is best suited / where
5G is more effective
5G for the enterprise
What’s clear is that knowledge of benefits (in a general sense) is positive.
Helping larger UK businesses to become more informed about 5G remains
vital, however. The research showed the following three areas in which
organisations would benefit from assistance in their 5G adoption journeys:
1
More help to build the business
case for 5G would appeal to
70% of organisations. For
instance, how to initiate and
conduct proof-of-concept trials
and setting realistic expectations
for when related technologies
will reach maturity so that
investment can be sequenced
accordingly.
2
64% of organisations
would benefit from greater
practical 5G implementation
knowhow that will allow them
to make good on their plans.
For example, how different
communications technologies
can be combined with 5G for
maximum effect.
As a still-nascent technology the research has shown that the availability (or
otherwise) of clear reference cases for 5G and its associated applications will
be what moves the market towards maturity.
Based on the results of this survey, the following may be judicious areas of
focus as part of a refreshed, post-COVID-19 industrial strategy:
• Encouraging 5G adoption and integration as part of national
infrastructure efforts (e.g. smart grids, transport infrastructure, etc.).
• Identifying the best candidates for 5G-enabled business models and
supporting early adopters within them as much as possible.
• Enabling 5G to improve digital access for all citizens and businesses
alike. This has become an especially acute concern given the strong
migration to home working.
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53% of responding firms sought
greater clarity on how best to
apply for 5G, particularly where
its advantages are most keenly
felt over other communications
technologies.
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About Neos Networks
Neos Networks provides class-leading connectivity and
data centre services that deliver very high performance,
cost efficiency and a competitive edge.
The company operates a 24,480km private telecoms
network and an estate of 90 commercial data centres
that span the UK. With its extensive telecoms and data
centre operational expertise it offers commercial security
with unrivalled in-house engineering resource.
[email protected]
+44 (0)345 070 1997