During summer vacations in Sweden, numerous articles, interviews and ads around 5G have framed both our physical and digital holiday adventures. Scratching the surface of the conversations, it is however clear that many people are puzzled of how to harvest the fruit of 5G in their professional setting; be it a factory, a hospital or a power plant. And although 5G is creating attention, there is little focus on how the Swedish industry – in practice – can accelerate deployment and profitability of 5G, in order to catch up.
KPMG has teamed up with Ericsson to guide companies on a profitable journey to 5G, both of us seeing the need to focus on the value of improved business processes and not the new communication technology itself. With 5G, you have the potential of a revolutionary development of your operations and significant gains in terms of quality, efficiency and safety – but it does require you to adapt your operations. Although one might argue that the time is not right for such a change in the middle of a burning crisis, we hear the opposite from many leading industry players; now is the time to increase and speed up digitization.
Within smart manufacturing, we already see the deployment of 5G applications as the next step in industry digitization. In Europe, Germany and Belgium are seen as forerunners and pushing the boundaries – with Audi and Atlas Copco as two examples where 5G networks are already deployed.
Both US, China and many European countries have released spectrums intended for 5G to enable wide development of 5G networks. For us in Sweden, the country-wide 5G spectrums are to be auctioned by PTS to the telco operators in November, but already in May the first public networks (“macro nets”) where announced, utilizing existing spectrums. Industry networks, known as private networks, will be available for corporations to purchase, starting at a time after the auction. However, test spectrums for industry installations are also already available. The first 5G-ready industry installation was announced by ABB, Borlänge in April 2020, utilizing a macro net set-up, and several other installations are in place utilizing industry test spectrums, eg. within the mining (Boliden) and logistics sector (DB Schenker/Einride).
Sweden, being later into 5G than many other countries, now has an opportunity to utilize learnings and hence be quicker and more successful in its 5G deployment. By preparing and testing (for example through the available test spectrums mentioned above), scale-up can be accelerated. Experience from existing 5G installations, as well as trials for other new technologies, also highlight the need to start with the end in mind; understanding what you want to accomplish using 5G and how the technology can be a means to realize this goal. Our experience from early testing in other European countries has been that installation and technology testing fails to prove the value of 5G and often ends as nothing more than a proof of concept that is never realized or scaled up – it is critical to identify tailored use cases to make sure that the impact on operations (and business value) can be evaluated alongside with the technology itself.
Setting up 5G will enable utilization of many other technologies and assets; the most important one being the ability to truly exploit the value of data both proactively and via AI/ML. It is not a plug-in solution nor a quick fix, but it can be a truly evolutionary journey. Partnering with relevant experts and advisors is a probable way forward for many corporations, and we foresee a new ecosystem being developed with technology experts, SI players, telco operators and business advisors – working shoulder to shoulder with the end-user. We see a challenge for telco operators – where they could be left out if not clearly demonstrating their contribution, as the industry player will be the ones holding the industry spectrums.
In summary, we have identified three main aspects that Swedish companies should focus on when looking at the 5G deployment roadmap from a practical point-of-view:
The possibility to continuously evolve and expand the usage of 5G further strengthens our hypothesis that this is not a one-brand-show; new partnerships and cooperation will be the enabler of the truly smart future – both from a tech and business perspective. Furthermore, we have seen several Swedish telco operators announce 5G-ready networks for consumers, and we urge the operators to also take a more active role in the private networks for industries – they will need to play a part in the new ecosystem to allow private networks to reach their full potential.
We see a massive need for the Swedish industry sector to catch up within 5G, and we strongly believe that the most efficient way to do this is to focus on operational impact and the business value, rather than being stuck in technical details. History proves that it’s the innovations that can be quickly translated into business impact that are allowed to scale beyond the proof of concept. And it is with the scale of data access and usage enabled by 5G that we will see real evolution into the next generation of industrial practices.
KPMG has teamed up with Ericsson to take companies on a profitable journey to 5G – and to the possibilities beyond. Read more on our partner page.