ASOCS is disrupting the industrial network connectivity market with an open and virtualized software solution that delivers 5G private mobile network solutions in a single software stack.
2020 was definitely far from boring when it comes to 5G. It dominated the headlines with stories about launches, conspiracy theories and sabotage, geopolitical turf wars, standard quibbles and bandwidth auctions that raised more than one eyebrow.
Looking forward, it seems that 2021 will not be much different. In the following paragraphs, I’ll discuss some current 5G trends and how I think they will impact the communications industry in 2021.
BTW, a year ago I wrote an article with my predictions for the communications industry in 2020. While no one could have foreseen COVID-19 and its effects, I believe much of them hold up. What do you think?
Prediction #1: Negative sentiment and disillusionment, especially in the consumer segment
A recent study found that nearly 50% of iPhone users believed that their device supports 5G, despite the fact that at the time of the survey, such a device had not been released yet. This demonstrates the confusion around 5G and the fact that many have no idea what to expect from it.
Where 5G has been deployed, many consumers are already frustrated with the speed, coverage, rates, and overall perceived value.
So far there is no noticeable difference to most consumers, no new widespread mobile applications benefiting from the technology, and often even speed tests and coverage and performance is nominal. Couple this with the fact that unlike with LTE, several operators are charging higher rates for 5G, and the backlash is immediate – 5G is “money for nothing”. Even less than nothing. These statements by Ryan Ding, head of Huawei’s carrier business, pretty much sum it up.
While the negative sentiment among the greater public is already surfacing, I expect the worst is yet to come with a public opinion backlash peaking around Q2 as 5G devices become more available to consumers.
While current criticism may be justified, I believe this negative sentiment will eventually fade as the ecosystem evolves, early issues are resolved and coverage and device availability increase.
How will this public sentiment affect players in the communications space? I expect three major ways.
Focus on 5G Private Networks:
Vendors and operators alike will continue to turn their efforts to private networks, and especially to Industry 4.0 related use cases that are already showing promise. The focus on Enterprise Private Networks and Industrial 5G Private Networks is a trend that I discussed last year, but I expect that it will intensify. There will be increased effort to focus on value-generating use cases that prove the value of 5G with success stories. More stories like that of Inventeclaunching a 5G private network and its effect on manufacturing productivity will help propel the industry forward.
Accelerated move to standalone 5G:
One of the major contributors to 5G lackluster performance is the legacy LTE core used in 5G NSA. The backlash will accelerate standalone 5G network deployments and bring with it much of the very real value that 5G has to offer.
More bandwidth auctions:
To be able to supply the higher capacities, speed, and performance, more bandwidth is needed. I expect to see more moves to free up more bandwidth, especially for industrial manufacturing and private network use. One example is the lower C-Band auction in the US (not to be confused with CBRS).
Prediction #2: The debate around open networks and network disaggregation will intensify
One of the much-anticipated aspects of 5G is that it is cloud-native, heralding a new era of best of breed networks. Disaggregated networks have disruptive potential for both network equipment vendors and for network operators who may face new competition.
The last component of the network to be virtualized is the cellular access portion. Over the past year, initiatives such as O-RAN, Open RAN, TIP and more have created de-facto standards to allow integration, and disaggregated networks have become feasible.
The poster children of the Open Network revolution are Rakuten, which is live in Japan, and Dish Networks, still on paper in the USA. Both technical and business results for Rakuten have been less than impressive, leading to audible sighs of relief (and even cheers) from traditional vendors and operators.
The highly emotional debate over the validity of an open radio access network (RAN) continues with the key arguments against it centering around the required integration efforts.
Some valid arguments have been made, including end-to-end ownership, new security vulnerabilities and even the lack of sufficient R&D personnel to support required integrations.
In my mind, these are moot points, for several reasons outlined in my next predictions.
But first and foremost, the main reason is that in most technological domains the openness debate has come and gone, and openness prevailed.
Open standards, open source, and stable APIs are the norm in most software related industries. The issues mentioned are teething problems and will be solved. In fact, they are already being solved, as you can see in my next prediction.
Prediction #3: An inflection point for both Open RAN and 5G in general
Despite my somewhat somber predictions for the first part of 2021, towards the end of 2021 I expect we will be somewhere entirely different. This is true both for Open Networks and for 5G in general.
If I may use the Gartner Hype Cycle as a reference model, then at the beginning of 2020 we were at the peak of inflated expectations. Right now we are sliding quickly into the trough of disillusionment. But at the end of the year I expect that we will start emerging into the slope of enlightenment (Some of us are already there!).
When it comes to cloud-based, disaggregated networks, there are two reasons for the expected upturn:
Availability and maturity of disaggregated network components:
To create a disaggregated network, all components need to be open and software based.
ASOCS is in the 5G trenches, doing actual deployments, and one of the major barriers we experienced in deployment was finding O-RAN compliant Radio Units. Last year there were maybe ~3-4. At the moment the number has grown tenfold. Both large manufacturers and local manufacturers are releasing more and more products compliant with O-RAN and Open RAN standards. By year’s end I expect this to no longer be an issue.
When we look at core networks we see the same phenomenon. If last year you could count the number of players on one hand, this year we will see many more. There are more options to choose from and the products themselves are more mature.
To a certain extent, the same is true for RAN software, in addition to ASOCS which has been in this arena from the very start. We are seeing a new type of player entering the market – server players who want to enter the RAN software market.
The rise of the System Integrators
Openness creates a shift in the market and changes the value chain by introducing a new type of player. In our case it is system integrators and in some cases OEMs that will integrate software with their hardware.
Some companies like Rakuten and Dish will take full ownership of their networks. Other organizations, mainly those whose core business lies elsewhere, may prefer to partner with System Integrators who are familiar with their organization and business needs.
We are seeing lively activity from both large, multinational SIs as well as local, specialist SIs. Those who are looking for a “single throat to choke” will still have it. It will simply be a different throat.
Prediction #4: IoT (finally) takes off, but not like everyone thought
It seems that talk of IoT devices has been going on forever, and by now they should have been all around us. Much of the talk about IoT, especially in the context of 5G has been a massive amount of small endpoints- trillions of sensors and small devices constantly transmitting small amounts of data.
This vision is nowhere to be seen in the tenders being issued these days in industrial manufacturing.
The current IoT technology used in Industry 4.0 5G related use cases includes sophisticated robots, vehicle control, drones and augmented reality for industrial use. The current requirement is for massive amounts of data to be uploaded quickly for control and use in AI. Almost every spec we come across for industry 4.0 refers to hundreds of these high ticket, productivity applications that are very well specified, with some unspecified requirement to support thousands of “additional” sensors.
Prediction #5: 2021 in industrial manufacturing will be about infrastructure, not use cases
I slightly contradict myself with this prediction, but bear with me, as it will make sense in the end. I hope.
Much of the activity in 5G industrial manufacturing will center on building the infrastructure as a first step. While there is a lot of activity and all deployments we have seen so far center around a use case (as it should be), 5G connectivity is only part of the puzzle for industry 4.0. To deliver the high productivity and flexibility gains, additional parts need to be in place, with AI being a critical one. 5G and AI go almost hand in hand to create the factory of the future. In 2021, leading manufacturers will focus their efforts on creating that combined infrastructure. Only after it has been laid out can the value really and truly materialize.
To summarise my predictions for 2021, the “slope of enlightenment” IS coming and it will be here sooner than you think. But the next few months will be tough, with a huge disparity between the general sentiment around 5G and the actual positive advances that are happening. Moreover, the progress will be more pronounced, mainly in industrial manufacturing. The number of 5G private networks based on cloud-based networks will explode in this domain.
There is history being made here, and no one said it would be easy. We must approach the upcoming year with lots of patience, a clear vision, and a lot of faith.
As the title says: brace yourselves!