Fifteen percent of enterprises are currently investing in 5G, rising steeply to 69% within three years. Yet, less than half (48%) are confident they can transition to 5G-based Internet of Things (IoT), with 74% indicating that they need to overhaul the operating model to realize implementation. That is according to a new EY study, Maximizing the 5G opportunity for enterprise, which surveyed more than 1,000 enterprises globally on the 5G opportunity.
- 15% of enterprises are currently investing in 5G, rising to 69% within three years
- 52% are not confident in their organization’s ability to implement 5G-based IoT
- US set to lead 5G investment over the next 12 months and beyond
The study finds that most enterprises (74%) believe 5G will enter the fabric of their business over the next five years. However, of those investing in 5G today, 67% are either engaging in trials or are in discussion with suppliers, rather than moving to the operational phase.
This caution is driven by several key factors, including knowledge gaps around use cases (75%) and a perception of 5G as an incremental progression on 4G (69%). In addition, respondents cite integration with existing technologies as the biggest internal barrier to 5G adoption (37%), while the perceived immaturity of 5G technology tops the list of external challenges (35%).
The study reveals that forming the right partnerships could be the key to unlocking 5G potential. Seventy-nine percent of respondents believe they require external support to generate robust 5G use cases, while 77% say they will prioritize vendors that can deliver 5G business outcomes as partners – rather than offering pure cost benefits. Notably, 60% indicate that their organization is currently struggling to identify the right 5G vendor, and 67% say their vendor interactions to date have largely been transactional and tactical.
Geographically, US enterprises lead the 5G adoption curve according to the study, with 19% currently investing compared with 13% in Europe. Just 10% of Asia-Pacific enterprises are currently investing, despite representing the highest level of planned expenditure over the coming year. Overall, US enterprises are set to remain ahead, with almost half (48%) planning to invest within the next 12 months, compared with 43% in Asia-Pacific and 38% in Europe.
The energy (23%) and technology (22%) industries are currently 5G investment leaders, with health care (61%) and financial services (58%) organizations projected to emerge as the biggest investors within three years.
Commenting on the research findings, Charalambos Constantinou, Partner and Head of Consulting of EY Cyprus, said: “5G will radically reshape businesses in the coming years. However, many companies have not yet developed a roadmap for transformation and remain wary of technology maturity and cybersecurity issues. They will soon need to become familiar with the transformational potential of technology, which goes beyond improving efficiency, and 5G providers need to present a compelling vision for opportunities and become reliable partners by providing comprehensive and effective solutions”.