On November 30, 2021, AWS CEO, Adam Selipsky, announced that AWS would be offering a private 5G network as a managed service. As expected, the announcement drew a tremendous amount of industry and media attention with many claiming that the age of private 5G networks had arrived. Trigger words “5G” and “private networks” aside, what are we looking at there with AWS’s latest venture to the edge of the network? According to the AWS press release, this new offering,
“Helps enterprises set up and scale private 5G mobile networks in their facilities in days instead of months. With just a few clicks in the AWS console, customers specify where they want to build a mobile network and the network capacity needed for their devices—and AWS delivers and maintains the small cell radio units, servers, 5G core and radio access network (RAN) software, and subscriber identity modules (SIM cards) required to set up a private 5G network and connect devices. AWS Private 5G automates the setup and deployment of the network and scales capacity on demand to support additional devices and increased network traffic.”
Moreover, instead of charging by device, AWS states that, “There are no upfront fees or per-device costs with AWS Private 5G, and customers only pay for the network capacity and throughput they request.”
Is Easy Easy Enough?
It’s very easy to get excited about announcements from AWS. Their scale and ability to execute makes one to assume that their entry into any market has disruptive or catalytic potential. This has not always been the case. Making private cellular has been a tough thing to realize despite years of podcasts, webinars, and panels that expound on the benefits of private cellular networks while at the same time lamenting the struggle that has been adoption and market scale.
Here are three neXt Curve impressions on last week’s announcement of AWS private 5G.
- The offering could be a solid boon for AWS’s large and growing SI (system integrators) partners who are looking for ways to make connectivity (on CBRS shared spectrum) a non-issue for 5G-based IoT solutions. Simplifying procurement, reducing cost of integration, and assuming the maintenance of network assets could take out a lot of the friction getting in the way of making private cellular networks a thing for Industrial IoT. TCO benefits will take time to prove themselves out for private 5G. However, it seems AWS is assuming that most customers will start with a pilot deployment and scale up from a couple of small cells. Time will tell how the economics play out for customers and AWS for larger production deployments.
- For the moment AWS ups the competitiveness of its IoT solution stack by providing a leading edge into critical app scenarios from cloud to PLC or actuator. They can take a loss on the connectivity to help their SI partners sell through premium AWS edge computing services for critical enterprise and IoT applications. SI’s essentially get a full stack of capabilities and horizontal compute and connectivity services to accelerate their stuff. There will still be systems integration work needed for the network. AWS is just offering the “converged compute and connectivity platform”.
- The issue for the private 5G market will be differentiation that justifies the investment. The question here is can AWS’s private 5G offering change the economics of currently non-existent URLLC deployments of 5G in industrial scenarios where the technology has the potential to be truly differentiated and will not have to prove itself against Wi-Fi or wired on the shop floor or distribution center. The cost of assurance for applications requiring URLLC capabilities is yet unknown but will undoubtedly add a layer of complexity, commitment, and cost not only on the front end but the back end of any private 5G deployments supporting critical industrial applications.
It’s Early Days
Amazon’s peers are not far behind though. I’m sure we will hear announcements from the #azure and #GCP teams soon given these guys have deeper cellular connectivity plays in Open RAN and telco software (Metaswitch and Affirmed, and Google’s Distributed Cloud Edge). Besides, first to market doesn’t mean you win. I can easily see a leapfrog event announced in the next six months, but it could be too early.
If AWS is successful, the big winners will be the system integrators who have been waiting for 5G to deliver on the promises of industrial grade wireless connectivity with the advent of Release 16 of the 3GPP standard.
What about the telcos? Will they be left out? It is yet to be seen if unlicensed and shared midband spectrum allotments around the world are sufficient for advanced, high-value industrial applications. Operators have a ton of spectrum holdings with a lot of industrial possibilities.
One thing is for certain – it promises to be an exciting decade in ICT. I wouldn’t count out pioneering carriers with a solid playbook from the private 5G opportunity.