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Partnering is a key consideration for telecoms pursuing enterprise 5G

Telecom and technology companies—particularly cloud providers—are bringing unique capabilities to build the enterprise 5G future together

Telcos are building on their reputation as a provider of connectivity services to become trusted partners in the evolution to next-gen networks and solutions.

Telecommunications companies have been spending billions of dollars acquiring wireless spectrum in order to build out their 5G networks—which places them under enormous pressure to grow revenue and recoup costs.1 Beyond their consumer connectivity objectives, many of these network providers are pursuing a share of the lucrative enterprise networking market.2 For many, their enterprise ambitions extend beyond mobile connectivity for business users, into the broader realm of private networks, edge computing, value-added enterprise solutions and the Internet of Things (IoT).3

However, achieving these ambitions won’t necessarily be easy. For one thing, 5G isn’t the only option for advanced wireless initiatives: For some usage scenarios, enterprises are adopting Wi-Fi 6, which they can deploy without licensing spectrum or engaging telco partners.4 And in markets where enterprises can own spectrum, such as Germany, telcos may have to compete with other vendors—including network equipment providers, hyperscale cloud providers (hyperscalers) and the enterprises themselves—to architect, build and operate 5G networks.5 Our global advanced wireless survey revealed that enterprises are currently most likely to turn to their organisation’s own IT staff (51%), followed by technology vendors (41%), before seeking advice from telecom/wireless carriers (33%), to guide their networking choices.6 Cloud and app providers are currently the most favoured for help with designing networks.

These current preferences aren’t that surprising. At least eight in 10 networking executives view advanced wireless as a key enabler of the next wave of innovative technologies they’re deploying to future-proof and transform their companies, such as big data analytics, artificial intelligence (AI), IoT, cloud and edge computing.7 While telecom companies have long sold connectivity services to enterprise customers, they haven’t historically been the go-to for digital transformation solutions. It makes sense then that tech providers—namely, cloud providers—are top of mind, since many enterprises are already working with them as part of their transformation initiatives. However, it’s important to note that the advanced wireless ecosystem is fluid and rapidly changing—and these preferences are likely to evolve as well.

Telcos and hyperscalers are both positioning themselves to take advantage of the emerging wireless opportunities. Spectrum licensing, mobility and device management are just a few of the new challenges presented by private wireless networks—and a place where network providers can shine. The telcos have expertise building out reliable “wireless superhighways,” and many are now in the process of engineering enterprise-oriented 5G products and services, as well as developing their go-to-market strategies. For their part, tech companies bring experience with data management, analysis and innovative application building—as well as an eager customer base.8

Indeed, cloud companies will likely be key: Nearly nine in 10 networking executives expect to deploy and manage their wireless networking applications and services primarily on the cloud or at the edge in the next 2–3 years.9 Telcos are already partnering with hyperscalers to extend cloud capabilities to the edge and offer more advanced networking solutions.10 And, many telco and tech companies are partnering to form innovation labs and incubators, aiming to codevelop innovative advanced wireless applications and products.11 Instead of competing head to head, it’s likely that network providers and tech companies will increasingly collaborate to develop the essential underlying infrastructure, applications and sales models needed to grow the market—and to deliver innovative enterprise solutions more rapidly.

As network providers aim to capture their fair share of the advanced connectivity market, they should expand their reputation as a provider of connectivity, to being a trusted partner for advanced wireless solutions in the enterprise.12

Considerations for network providers

  • Recognise that advanced connectivity is ultimately about innovation. Networking executives consider 5G and next-gen networks as strategic enablers of innovation. Indeed, our survey found that the top driver for enterprise adoption—tied with improving efficiency—is a desire to take advantage of new technologies. Network providers should therefore strive to become customer-centric and solution-focussed, as well as consider when to partner with technology providers.
  • Recognise the advantage of licensed spectrum. To build out private networks, almost half of those surveyed said they would prefer to use licensed spectrum (dedicated or shared) from a network provider.13 Telcos have the benefit of holding 5G-suitable spectrum and can seek to monetise those assets by extending their public networks deeper into the private setting. With their extensive experience running cellular networks, network providers can offer key capabilities such as cybersecurity, privacy and established relationships with other carriers to support WAN and mobility use cases.
  • Embrace the larger ecosystem. The next-gen wireless ecosystem is complex and evolving. On average, adopters engage with about eight types of vendors—such as cloud providers, application developers, wireless carriers, network equipment providers and consultants/system integrators—and often with multiple vendors of each type—to cobble together custom solutions.14 And just three in 10 adopters prefer to keep engaging with their current vendors; the rest are open to switching.

What’s more, the architecture of 5G networks is expected to become more virtualised, open and programmable, allowing best-of-breed components to proliferate.15 Managing and orchestrating a multitude of solutions is notoriously difficult. To tackle the growing complexity, adopters are likely to seek more help from system integrators and consultants. Against this backdrop, wireless carriers should consider partnering strategically with other vendors, as well as integrators, to provide full end-to-end solutions. As the underlying technologies mature, carriers can also commercialise standardised products and build their reputation as a trusted partner.

Technology, Media & Telecommunications

Deloitte’s Technology, Media & Telecommunications (TMT) industry practice brings together one of the world’s largest group of specialists respected for helping shape many of the world’s most recognised TMT brands—and helping those brands thrive in a digital world.

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  1. Emily Bary, “Why Verizon, AT&T and T-Mobile just spent $80 billion in an auction, and what it will mean for 5G ,” MarketWatch, February 26, 2021; Juan Pedro Tomás, “Germany completes 5G spectrum auction ,” RCR Wireless News, June 14, 2019; Bevin Fletcher, “UK operators bolster 5G spectrum holdings after 3-day auction ,” Fierce Wireless, March 17, 2021.

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  2. Analysts estimate the global 5G enterprise market will grow from US$2.1 billion in 2021 to US$10.9 billion by 2027 and the related global edge computing market is projected to reach US$250 billion by 2024. MarketsandMarkets, “5G enterprise market worth $10.9 billion by 2027 ,” April 1, 2021;, “Worldwide spending on edge computing will reach $250 billion in 2024, according to a new IDC spending guide ,” September 23, 2020. 

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  3. Larry Dignan, “T-Mobile, AT&T, and Verizon to duel for 5G enterprise, business subscribers ,” ZDNet, March 17, 2021. 

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  4. Jack Fritz et al., Accelerating enterprise innovation and transformation with 5G and Wi-Fi 6 , Deloitte Insights, March 22, 2021.

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  5. Juan Pedro Tomás, ”German regulator has already approved 123 private 5G networks ,” Enterprise IoT Insights, June 7, 2021; Catherine Stupp, “German industrial firms plan to build private 5G networks ,” Wall Street Journal, April 6, 2020.

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  6. To understand how enterprises around the world are adopting advanced wireless technologies, in Q4 2020 Deloitte surveyed 437 IT and line-of-business executives responsible for connectivity at organisations in the process of adopting 5G and/or Wi-Fi 6 or planning to adopt either technology within the next three years. The countries represented: China (50 respondents), India (51 respondents), Japan (51 respondents), United Kingdom (54 respondents), Germany (50 respondents), Netherlands (50 respondents), Portugal (29 respondents), Brazil (51 respondents), and Australia (51 respondents). Eight in 10 surveyed executives decide networking investments; 7 in 10 manage implementations. Seventy-one percent of respondents are IT executives; the rest are line-of-business executives; 59% are in the C-suite. See Jack Fritz et al., Accelerating enterprise innovation and transformation with 5G and Wi-Fi 6.

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  7. Ibid.

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  8. Twain Taylor, “Telcos turn to cloud vendors for ‘last mile’ 5G networks solutions ,” TechGenix, February 15, 2021; Belle Lin, “Why 5G is a huge enterprise opportunity the cloud giants have already moved in on ,” Business Insider India, March 17, 2021. 

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  9. Adopters recognise that connecting devices, machines and sensors is only one aspect of the solution; the data they generate must be stored, analysed and integrated with the company’s operational data. When asked where they expect to primarily manage wireless networking applications and services in 2–3 years, 70% of adopters report public or private clouds, 16% report the edge and only 14% report on-premise.

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  10. For example, Amazon is partnering with telcos to embed compute and storage services at the edge—in base stations or the network operators’ data centers—and customers can continue to use the cloud APIs with which they’re already familiar, without needing to create an edge presence themselves. Google Cloud is partnering with AT&T to bring edge compute services (such as cloud-based AI and machine learning) to the network edge. See: Paul Gillin, “Out on the edge: The new cloud battleground isn’t in the cloud at all ,” SiliconANGLE, December 1, 2020; Ed Targett, “AWS Wavelength: The cloud comes to your 5G network ,” Computer Business Review, December 9, 2019; Kelly Hill, “Google Cloud jumps into 5G and telco edge computing with a ‘GMEC’ vision ,” RCR Wireless News, March 5, 2020. 

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  11. Sean Kinney, “5G Open Innovation Lab includes edge, automation, IoT specialists,” RCR Wireless News, March 22, 2021; Jim Davis, “Verizon's efforts to incubate enterprise 5G applications come as competition in the market accelerates ,” Business Insider, November 20, 2020. 

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  12. Joe O’Halloran, “CSP share of enterprise 5G deals falls 5% in 2021 ,” Computer Weekly, July 8, 2021.

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  13. Only 6% said they prefer to use unlicensed spectrum. See Fritz et al., Accelerating enterprise innovation and transformation with 5G and Wi-Fi 6.

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  14. Types of vendors may include wireless carriers, network equipment providers, component vendors, infrastructure providers, application providers, cloud providers, private network providers, fixed wireless network providers and consultants/system integrators. See Fritz et al., Accelerating enterprise innovation and transformation with 5G and Wi-Fi 6

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  15. Leonardo Bonati et al., “Open, programmable, and virtualized 5G networks: State-of-the-art and the road ahead ,” Computer Networks 182, December 9, 2020.

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Thanks to Sayantani Mazumder for thoughtful suggestions and support with data analysis.

Cover image by: Jaime Austin

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