Private cellular networks are a heavy lift with abundant potential that could reframe network operators’ role with enterprises, but that window of opportunity amid the proliferation of 5G is closing, according to ABI Research. 

The conclusion is particularly troublesome for mobile network operators because many perceive private networks to be a mostly untapped source of growth, a new revenue stream they’re relying on to help offset the massive investments made in 5G.

While carriers have aggressively promoted 5G as the catalyst for private network proliferation, there’s been less emphasis on specific business outcomes, according to ABI Research. Moreover, 5G marketing hype remains years ahead of reality, and many enterprises are still waiting for 5G capabilities that have been promised for more than three years.

“As these enterprises realize that full support for ultra-reliable low-latency communications (URLLC) and time-sensitive networking will still take years to mature, they are becoming growingly impatient and starting to look at technology alternatives,” Leo Gergs, senior analyst for private networks at enterprise connectivity at ABI Research, wrote in a new report. 

“The telco industry must realize that the value proposition for enterprise 5G does not lie in the technology as such, but in the applications it enables. After all, no enterprise cares about whether they deploy 4G or 5G on their premises, as long as the technology solves their pain points,” he explained.

Gergs also noted that many existing private network deployments, of which at least 290 are publicly disclosed worldwide, according to ABI Research, are primarily designed to showcase 5G capabilities, test solutions, and integrate services with system integrators or factory automation vendors. These sales-driven activities are especially dominant in Germany, he added.

All of this depresses the adoption curve for commercial deployments and limits the window of opportunity for 5G enterprise overall, according to Gergs. 

The Global mobile Suppliers Association (GSA) earlier this month said at least 370 companies globally have been or are investing in private mobile networks, but notes LTE still accounts for the majority of deployments.

Expectations for private enterprise 5G networks remain high among many analysts and industry associations, but the relatively tepid pace of adoption thus far merits some challenges and concern.

One of the core challenges is that every enterprise is unique, and “one size does not fit all,” Chris Pearson, president at 5G Americas, wrote in a recent blog post. “For potential private wireless network operators, a key item to understand is the sheer complexity and magnitude of the task,” he explained, adding that identity management, authentication, onboarding, authorization, policy definition and enforcement, and security must all be taken into consideration. 

Nonetheless, Pearson remains optimistic about the outlook for private 5G networks, as he highlighted a recent report from Polaris Market Research that projects the private 5G networks market to reach $13.92 billion by 2028, representing a nearly 41% compound annual growth rate.

Mobile network operators’ role in private networks also remains an ongoing debate. Private network vendors like Celona argue there’s no need for network operators to be involved as long as private spectrum options are available. Many radio access network (RAN) vendors have also proven as much, highlighting private network deployments that don’t involve a traditional network operator, but haven’t publicly acknowledged this detail as forcefully.

Wireless operators are encountering the same roadblocks in private 5G that they previously confronted with managed WiFi services, Özer Dondurmacıoğlu, VP of marketing at Celona, told SDxCentral in a phone interview.

“They’ve tried to do it with their existing radio vendors, they’ve tried to piecemeal it with some mobile core software and some provisioning service, they tried to create their managed services portal to support a model to get it up and running, but it takes time, it takes a lot effort,” he said. 

Private networks should be integrated into an existing enterprise environment, much like wired LAN or SDN, and as such, Celona’s framework is akin to cloud networking for private 4G LTE and 5G, Dondurmacıoğlu said. 

“I think [mobile operators] overpromised. Enterprises are just much more practical in their thinking,” he said. “They don’t have the patience when operators tell them the world is going to be great and you’re going to get one-millisecond latency and everything is going to be perfect for the last three years.”