What's holding businesses back?
The gap between enterprise awareness of 5G’s benefits and current levels of adoption suggests a degree of inhibition when it comes to implementation. To understand why this might be, our survey explored what technology buyers perceive as the principal barriers to deploying 5G – whether their own concerns or organizational limitations beyond their control. In parallel, we asked experts what needs to happen to break these logjams and bring adoption of 5G firmly into the mainstream, through which we identified five principal barriers to 5G adoption for enterprises.
Barriers to adoption
Our research identified five principal barriers to 5G adoption for enterprises:
Ecosystem availability
5G currently exists in pockets of availability. Some urban cities have 5G networks and a minority of organizations have developed private 5G networks – but it is not yet the network standard. As such, the most-cited barrier to 5G investment and implementation was ‘availability of 5G-enabled products’, mentioned by 28% of decision-makers. In turn, 22% of buyers surveyed said they are unsure which provider to use and 19% pointed to lack of coverage as a stumbling block.
But this shouldn’t hold businesses back, says global technology futurist, Daniel Burrus: “5G availability is rapidly growing on a global scale, starting in the largest cities where most businesses and people are. 5G usage is increasing in dense populations and will spread outward from there. Innovation is about looking ahead. While 5G may not be widely available now, it soon will be. The businesses who get ahead of the curve will be best placed to reap the benefits.”
Education and understanding
Awareness
Cost and complexity
Security
5G currently exists in pockets of availability. Some urban cities have 5G networks and a minority of organizations have developed private 5G networks – but it is not yet the network standard. As such, the most-cited barrier to 5G investment and implementation was ‘availability of 5G-enabled products’, mentioned by 28% of decision-makers. In turn, 22% of buyers surveyed said they are unsure which provider to use and 19% pointed to lack of coverage as a stumbling block.
But this shouldn’t hold businesses back, says global technology futurist, Daniel Burrus: “5G availability is rapidly growing on a global scale, starting in the largest cities where most businesses and people are. 5G usage is increasing in dense populations and will spread outward from there. Innovation is about looking ahead. While 5G may not be widely available now, it soon will be. The businesses who get ahead of the curve will be best placed to reap the benefits.”
5G resourcing – progress to date
% of organizations which have built the resourced needed to integrate 5G into their operations and services into their strategy and planning process
Companies may appreciate the benefits of 5G in theory, but not all understand how they would actually use it within their organization. In our survey, 17% said a key barrier is that decision-makers within the business do not understand 5G, while 14% said they don’t know enough about it themselves. “While there may be some appetite for 5G, business leaders don’t really understand how to make 5G happen for them: how do they do it? Who do they work with?” says futurist Bernard Marr. That is reinforced by the 36% who said that a better understanding of 5G, and the benefits it offers, would encourage them to invest more. Education is key – but so is proving the technology can deliver for the different possible use cases. Organizations should invest time to conduct early trials and validation testing – giving them the opportunity to fully explore and get to grips with the technology ahead of roll out.
Over a fifth of technology buyers (22%) said that 5G implementation is not a current priority for their business, the third most-cited barrier after cost and availability. That, suggests Bernard, may underline a lack of awareness about its near-term potential. “Companies still believe that 5G is some time in the future. I think there’s a lack of awareness of how transformative 5G can actually be for businesses. I don’t think companies are aware of 5G’s potential and how it will change their business processes.”
Another hurdle for 5G investment is the complexity surrounding the related infrastructure and how to manage its installation. 15% of those surveyed said they were not confident their organization would be able to implement the necessary technologies, rising to 23% among technology buyers in the healthcare sector. Given that 5G involves some restructuring of internal operations to unlock benefits, 26% also cited high costs as a barrier to implementation.
Unsurprisingly – as with any new concept – there are concerns about what the introduction of 5G might mean for organizational and network security. Over a third (34%) said that they are concerned about the security of 5G, rising to 40% in healthcare and 43% in the mining industry. In turn, 22% cited security risks related to 5G as a primary barrier to its implementation.
Concerned about the security of 5G
Sector least concerned about security as a barrier to implementation
Technology buyers nervous to invest because of future uncertainty
Catalysts for change
Experts interviewed for this report highlighted some key interventions that could act as catalysts for improved understanding, confidence and ultimately adoption of 5G. They pointed to three critical success factors for wider 5G adoption:
Changes to regulation and government intervention
A third of technology buyers in our survey said that government investment in infrastructure or subsidies to drive down costs would encourage them to invest more in 5G. Indeed, our work with all parts of the ecosystem suggests that enterprises will not adopt 5G unless the supply from network operators is presented and priced appropriately, which in turn relies on governments and regulators making 5G spectrum in low, mid and high bands available in an affordable way.
“Governments can facilitate the deployment of telecom infrastructure by opening up access to physical real estate for 5G infrastructure (small cells), as well as simplification of installation regimes as networks become denser,” says Gabriela Styf Sjöman. “Allowing network slicing and differentiated quality of service (with balanced net neutrality rules) is important as well. As we head towards the ‘great reset’ in the wake of COVID-19, national recovery budgets need to foresee adequate financing for improving connectivity where needed for 5G and very high capacity fixed networks (fiber).”
Improved information sharing
In parallel, says Bernard, the lack of understanding that exists within some businesses around 5G must be directly addressed. “People need to understand how 5G can benefit their business and wider society. Sharing real use cases of how 5G is helping people now – for example, enabling remote education during the pandemic – is key to helping people really get to grips with how the technology fits into our world and understanding 5G’s potential.”
Dr Sally Eaves echoes his call for a more collaborative approach: “People have to buy into the idea of sharing information in order to accelerate this. There are things being done that are advancing the industry, but we need more. We need to foster more and more collaboration.”
Daniel agrees that collaboration is a critical – but emphasizes that this must be proactive. “There’s a difference between cooperation and collaboration. Cooperation is a defensive move, to defend one’s piece of the economic pot out of necessity. Collaboration is openly working together to create a bigger pie for all.”
A bolder approach
For 5G deployment to become widespread, Bernard believes, businesses need to see the bigger picture of how it could change their business for the better. “They really need to think about their overall business strategy, think about the products and services they offer, and how 5G could potentially transform those customer offerings.
Alongside customer benefits, there is an opportunity for businesses to overhaul operations – for example, exploring how they could use 5G to streamline and more effectively monitor their mobile workforce, fleet or supply chain. Nokia’s Raghav Sahgal agrees: “In this context, 5G becomes more than a connectivity value-add and emerges as a catalyst for business transformation: a fundamental pillar of innovation and growth, helping enterprises both to optimize and diversify their business models.“
Collaboration and confidence
5G is not a bolt-on technology but a complex ecosystem of moving parts, both technically and in terms of its participating ecosystem. One risk is that different stakeholders hang back, waiting for others to drive progress.
As this research underlines, there is no single barrier holding companies back from 5G adoption and as such no silver bullet solution to accelerate adoption. “Collaboration between different stakeholders is necessary to drive progress, helping create momentum throughout the ecosystem,” says Gabriela. “More collaboration, confidence and understanding on all sides is what will unlock the full potential of 5G deployment. We need to see more knowledgeable and proactive enterprises that dare to explore new business models as well as governments that provide the support that companies need.”