Enterprise campus connectivity - an early use case for 5G network slicing
Trends in connectivity
Enterprises are on a digitalization journey, which kicked off by improving current operations like AGVs/automated vehicles, AR/VR training, IoT services, and is evolving to empower AR enabled operations, remote control, for example, future innovation like autonomous/collaborative robots, digital twins. The immense opportunities 5G provides is why there has been such high high interest from enterprise businesses over the last years.
There are already some CSPs that have started to deploy and offer 4G cellular connectivity with premium quality of service (QoS) policies in Germany. This looks promising so far, and there is clear interest from medium-size enterprises. From a technical perspective, this can be seen as a pre-runner to network slicing. In many cases discussions with the enterprise buyers started with them being interested in investing in private cellular networks, but ended up with them only having a slice-based private cellular connection due to the cost benefits of not having to invest in a private network on-prem. This indicates that there is a market for dedicated connectivity services over slicing.
Enterprises in multi-tenant campuses
When we think of a campus, we think of an area usually less than 1 to 2 square kilometers in size, consisting of different enterprises with potentially different connectivity needs. The types of enterprises could range from large shopping malls to multi-tenant office blocks, transport and logistics hubs, harbors, or science/industry parks.
Those could be categorized in two dimensions:
- if the connectivity requirements are either being strict or more relaxed
- whether their needs are permanent or temporary.
With this in mind, we see opportunities for enterprises with stringent connectivity requirements and permanent needs like industry parks with medium-size enterprises that have advanced production and testing processes, possibly with some related transport and logistics.
Using network slicing would have great benefits for medium size enterprises in particular those with the needs of a larger enterprise but not the IT-skills nor a viable business case for a private network. Other benefits with slicing, besides cost, include the time-to-deploy services, mobility in the campus area which today is served with Wi-Fi and elasticity to quickly expand, for example the capacity or ability to modify the characteristics of the connection.
Business and go-to-market models for CSPs
Today the wireless dedicated multi-enterprise connectivity market doesn’t really exist for CSPs; other than fixed fiber to enterprises or in some cases fixed wireless access. These are best effort services the quality of the connection depends on the local conditions regarding the quality of the connection. This market is managed service providers or campus landlords providing connectivity solutions and/or support services.
Although this market is mainly about connectivity, there is a plethora of enterprise end customers, ranging from a few very large enterprises to tens of thousands of small ones. Considering the existing players in the value chain, we will a few different go-to-market models to consider.
Here, the CSP goes directly to the customer with a proposition that may start with private networking and fall onto slicing as a better fit, e.g., due to lower cost.
Here, the CSPs offer wholesale capabilities to local managed service providers (MSPs) with existing customer relations and industry knowledge.
In this model, the CSPs build exclusive relationship with campus landlords or facilities managers to serve campus tenants.
With slicing, we see opportunities to develop some different business models, depending on the type of CSP and the level of the service level agreements (SLAs). We see four different possibilities to offer multi-enterprise campus connectivity.
1 Slice-on-a-SIM or super SIM
The CSP sells a premium service much as it does normal connectivity today with similar package options and various buckets, but with a higher value cost/GB uplink.
2 Geofenced dedicated connect
The CSPs offer an interface for enterprises to reserve a dedicated slice resource and guaranteed on-premises service level agreements.
This could be a permanent or a scheduled service to ensure service levels at certain times.
3 Bespoke productized solutions
The CSP become an MSP or MSP partner to provide slicing-based connectivity or bring a certain solution component, that may include dedicated resources like staff and/or support.
4 Productized campus solutions
The service provider provides an off-the-shelf solution, including a pre-configured slice for more horizontal standard solutions, like security and surveillance or asset tracking.
This is a brief overview, so for some more detail on the business models and go-to-market roles and with whom and why to partner, please explore our newly published report on Multi-enterprise campus connectivity services.
Go to market planning and partners to work with
Looking at the multi-tenant campus network value chain, some of the key players to partner with are besides the enterprise tenants, the campus landlords and the existing managed service providers. They will be key to reaching the larger number of small and medium enterprises for either sell-through or wholesale.
The first steps to commercialization for the CSP are:
- Conducting a market analysis to define roles in the value chain i.e., either towards offering solutions and support or mainly a connectivity focus.
- Engaging with enterprise customers to understand their drivers and conduct trials.
- Building a holistic campus network proposition and coordinate potential private network offerings.
In any case, we believe most CSPs can begin by offering a Slice-on-a-SIM solution before deciding whether to move into a deeper role in the ecosystem, like becoming a managed service provider.
Multi-enterprise campus connectivity services are predicted to be one of many use cases to come on 5G and one of the first use cases to be explored and some leading CSP are in trials today. Our estimations also indicate that this use case is a positive business case. This area allows CSP to start on a smaller scale with some campuses to gain experience with the advantage that many of the business models are familiar for CSPs and the initial investments and risks are limited.
For more info and details on all the topics in this blog post and more, please explore our newly published Multi-enterprise campus connectivity services report, part of the Network slicing early commercial use cases series.
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