16th Sep 2022
- Private 5G Networks could be what it takes for major corporations to join the 5G revolution
- These networks could provide major enterprises with better connectivity than ever before
- Private 5G networks could have a significant impact on investment in 5G stocks
Given how rapidly 5G technology is being developed, keeping track of it all can be challenging. Regardless, doing so can yield immense benefits. Not only is 5G technology capable of increasing connectivity, but making the right investments in 5G stocks could reap financial rewards for your portfolio. In order to make smart decisions regarding investments in top 5G stocks, it helps to gain an understanding of private 5G networks.
Private 5G networks are an essential aspect of the 5G rollout for various reasons. Private 5G networks are set up by private enterprises and they offer improved data privacy, increased bandwidth and lower latency. These types of networks are usually deployed on a single site like a major steel mill or plant.1 For more insights about the role of private networks in the 5G rollout, continue reading below.
Private networks play a pivotal role in the rollout and adoption of 5G in general. Along with faster connections, they have the potential to simultaneously support a high volume of engaged users in broadband applications. During tests, mobile network provider Verizon registered speeds higher than 800 mbps, according to an analyst, which would make 5G roughly 10 times faster than speeds on 4G LTE networks.2
Despite the increased speeds and ability to support more simultaneous users than 4G networks, enterprises may still refrain from adopting the 5G technology, citing reasons such as price or time constraints in making the switch. The introduction of private networks could alleviate these concerns among private companies, leading to further adoption of 5G technology. The ability of managed service providers (MSPs) to provide private enterprises with the benefits of increased speeds without security risks could be exactly what it takes to get more companies to make the switch to 5G. In fact, some companies are already beginning to make the change while enjoying the benefits of doing so.
Private 5G networks are gaining popularity for a variety of reasons. Not only do they provide improved privacy and data control, but they can also be instrumental in providing improved workforce connectivity through automation.3 Industries like construction or manufacturing particularly benefit from 5G networks because of the fact that they provide wider coverage, requiring fewer access points, which allows workers to spend less time installing and managing infrastructure related to their networks. The ability of 5G networks to deliver connectivity to hard-to-reach areas could help take the adoption of private 5G networks to the next level.
Another potential application of private 5G networks are companies seeking connectivity solutions during offshore drilling projects. According to principal security consultant at NTT Security Majid Ali, offshore oil platforms have routinely faced connectivity challenges. As a result, oil platforms have faced reduced speeds and intermittent connectivity for years, mainly because running a cable from the platform to the shore isn’t possible.4 The potential efficiency gain of private 5G networks is one possible reason investors may be interested in learning more about 5G stocks.
There are a multitude of approaches private enterprises can take when implementing their private 5G networks. Among the different entities involved in solutions for private 5G networks are public cloud providers, network equipment providers (NEPs), system integrators, challenger vendors and mobile network operators (MNOs). Deciding which approach to take depends on what characteristics within the network the company values most. Even though companies benefit from having a variety of suppliers to choose from, none of them alone can provide all of the full benefits of private 5G networks. 5
Since that’s the case, private enterprises that choose to set up their own private 5G networks need to team up with other entities within the 5G landscape in order to achieve their ideal setup. For instance, if an entity chooses to work with NEPs, they would likely end up working in conjunction with a MNO in order to deliver the private LTE or 5G network, since NEPs often face the challenge of scaling down their solutions to meet the demands of a private enterprise. In fact, Ericsson, Huawei and Nokia each offer private network components to support private 5G networks.
Companies that are keen on working directly with entities capable of meeting their demands may benefit from working with challenger vendors like Althonet or Mavenir. These companies are leading the charge when it comes to using cloud-based architecture to provide 5G core networks, as these options are designed specifically for private networks, as opposed to public mobile networks. Public cloud providers like Amazon Web Services (AWS), Google and Microsoft are another option for private enterprises attempting to build out their own private networks. That’s since their recent efforts to equip their edge networking solutions to support certain components of private 5G network deployment.
Microsoft has purchased two challenger vendors in an attempt to strengthen its contributions to the core network. Private entities could benefit from relying on systems integrations they already use. Additionally, many of them widely regard cellular technology as an opportunity to add another network technology to their portfolio. MNOs like AT&T, Verizon, Vodafone and Deutsche Telekom have already launched 5G network prepositions that work in unison with their approaches to IoT (Internet of Things) and edge computing.6 Even though the rollout of 5G is still developing, there’s good reason to believe businesses may begin to adopt the technology sooner rather than later
Given the vast array of options companies have in terms of setting up their private 5G networks, and their role in the uptake of 5G, learning about 5G stocks to invest in may be worthwhile for forward-thinking investors. There are numerous insights that should be taken into consideration prior to investing in any 5G stock. For instance, before investing in individual 5G stocks, it could be worth exploring a 5G ETF that offers access to a range of 5G companies. ETFs like Defiance’s FIVG ETF holds a portfolio of 5G stocks, which provides investors exposure to this growing sector.
As of this writing the following stocks mentioned are current holding of Defiance’s ETF, FIVG: Verizon Communications Inc, Ericsson, Nokia Corp, Amazon Com Inc, At&t Inc, Vodafone Group Plc New.