Something unusual is predicted to happen in the mobile infrastructure business: indoor mobile coverage might be led by enterprises, rather than mobile operators, as more of the 5G connectivity business moves indoors and into private local networking hands.
That means traditional suppliers of public network infrastructure will have new markets, selling direct to enterprise end users, in much the same way that data networking firms sell direct to enterprises and through channel partners to smaller businesses and organizations.
Private networking might not have service provider implications--positive or negative--as big as one might suspect. In essence, private 5G is akin to the traditional local area networks business.
And the LAN business, like the enterprise voice business before it, never has been the province of public network service providers, whose networks terminate at the side of the building. According to Real Wireless, most indoor small cells, for example, will be supplied by enterprises or their contractors, not mobile service providers.
As interconnects and system integrators have led the enterprise voice and local area networking markets, so too will similar firms likely emerge to lead the private 5G market as well, and for similar reasons.
For starters, public networks terminate at the side of buildings, with private signal distribution inside buildings the province of property owners. So the whole connectivity service provider business is built on wide area connections between places. The revenue model does not depend on revenues from creating indoor premises networks.
So the core competencies of WAN and LAN firms are different.
Much of the LAN business also is fragmented and hard for large service providers to address in direct fashion. There simply is too much custom work, for too many small customers, to leverage service provider scale.
Even in the sales function, mobile operators do not employ direct sales forces except for enterprises. They often use channel partners to reach some business customers. And wholesale support for mobile virtual network operators might qualify as use of channel partners as well.
But for the most part, retail sales to consumers and small businesses are supported by mass media advertising and retail stores. Those same sorts of economics will drive the 5G private networking business as well.
Some mobile operators will create dedicated private networking units focused on a relative handful of large customers (sports venues, conference centers, large retail complexes, government entities), as already is the case.
But much of the actual work will be done directly by large enterprises or specialists in premises networking, as is true for business voice or local area networks generally.
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