5G investment set to soar

Fifteen percent of UK businesses are currently investing in 5G, rising steeply to 70% within three years. Yet, less than half (44%) are confident they can successfully implement 5G-based Internet of Things (IoT), with only a quarter (25%) indicating that they do not need a significant overhaul of their operating model to realise implementation. This is according to a new EY study, How 5G is redefining the world of enterprise, which surveyed 200 UK cross-sector businesses.

The study finds that most businesses (74%) believe 5G will enter the fabric of their business processes over the next five years. However, of those investing in 5G today, most are still only in discovery and planning mode, with 61% either engaging in trials or in discussion with suppliers, rather than moving to the operational phase. 

This caution may be driven by organisations’ lack of understanding of 5G’s benefits, including knowledge gaps around use cases and concepts (78%) and a perception of 5G as only an incremental progression on 4G or Wi-Fi (70%). 

Praveen Shankar, EY’s Head of Technology, Media and Telecommunications for the UK & Ireland, said:

“UK businesses are keen to invest in 5G, but this is not matched by most organisations’ capabilities. To overcome this challenge and reach the full potential of 5G, providers need to articulate a more compelling vision of the opportunity, while businesses need to educate themselves on the game-changing possibilities. Success will require adapting existing strategies like IoT to take full advantage of 5G and also understanding the links with adjacent emerging technologies such as AI.”

The study reveals that forming the right partnerships could be the key to unlocking 5G potential. 79% percent of respondents believe they require external support to generate robust 5G use cases, while 76% say they will prioritise providers that can deliver 5G business outcomes as partners – rather than offering pure cost or technology benefits. Notably, 61% indicate that their organisation is currently struggling to identify the right 5G provider, and 67% say their provider interactions to date have largely been transactional and tactical.

Adrian Baschnonga, EY Global Telecommunications Lead Analyst, said:

“It’s clear that enterprises now want consultative dialogue that delivers business outcomes through end-to-end solutions. 5G providers need to reinvent themselves as trusted partners, prioritising access to an ecosystem of competencies that can deliver 5G capabilities at scale. Delivering actionable solutions that encompass the full spectrum of enterprise needs – from use case creation to cybersecurity – will be critical in the long-term.”

UK businesses appear to be ahead of the curve on prioritising 5G, with 35% of respondents seeing 5G’s impact on business models as a focus area. This is compared with 28% worldwide. At the same time, 31% viewed greater participation in 5G trials as a top priority, compared to 25% of global businesses.