Ahead of a new report about how to reconcile custom design and easy scalability of private 5G in Industry 4.0, here is a straight Q&A with David de Lancellotti, vice president for enterprise campus edge sales at Nokia, about the challenges to make private industrial cellular scale. It covers a lot of ground – from Nokia’s own news (and marketing) through to a sharper dissection of the how 5G integrates with IT and OT systems. All the answers below are from de Lancellotti. Look out for the report, out next week.
What’s new for Nokia in the private 5G market?
“We lead the next wave of digital transformation by offering a unified platform for industrial digitalization that comprises an OT edge able to run digitalization application workloads, AI-powered productivity tools, cloud, and industrial connectors together with industrial devices and flexible wireless connectivity that goes beyond just 4.9G or 5G private wireless.
“However, it is also worth mentioning that private wireless and Wi-Fi both play an important role in the digital transformation of industries. This is why we have an integrated solution that gives enterprises the option to use Wi-Fi and mission-critical private wireless, and even use both technologies simultaneously (MX Boost). This platform is unique in the market, and we continue to see a lot of traction for this approach as it brings all the key technology enablers required for Industry 4.0 and helps reduce the complexity and the time it takes to get new use cases up fast.”
What has changed in the last six months to make sales faster / easier?
“We continue bringing in all the sales expertise in focus verticals, which is backed up by our partners. Sales expertise paired with a strong portfolio is a winning combination. Our digitalization platform is ecosystem-neutral, enabling enterprises to deploy edge applications from many different software vendors. We have onboarded many new applications into our integrated offering.
“Recent innovations and introductions include an expanded OT edge architecture exploiting connected and orchestrated OT micro edges with MX Grid, Nokia’s AI-powered MX Workmate and VPOD, and a slew of new third-party applications in worker safety, connected worker, and tracking and positioning categories. With this innovative platform, we are focused on packaging and bundling our solutions elements to deliver high-value Industry 4.0 use cases that set us apart from the competition. These use case solutions are delivered and packaged with innovative commercial models that incentivise the adoption.”
Are sales any easier? Why? Are they going as fast as Nokia wanted / expected?
“In general, yes; but let’s keep in mind that enterprise awareness is a journey that starts with heavy evangelization on the vast benefits that digitalization, automation, and private wireless networks bring – such as establishing new and improved ways of working and achieving greater sustainability. The pipeline continues growing in all regions, and we see strong growth in verticals such as oil and gas, process manufacturing, mining and ports. But we have also won new automotive customers such as Audi with our partner Verizon.
“Existing customers are accelerating their digital transformation by the implementation of additional use cases and repeat business from existing customers in additional sites. All in all, as we work across the most significant industries, it is hard to find an enterprise that has not embarked upon a POC that is now developing its enterprise architecture or has moved towards an operational deployment that is now scaling. But evangelizing enterprises so they can adopt and reap the benefits of private wireless networks is a continuous task.”
How is private 5G in manufacturing versus other sectors?
“Manufacturing is one of the largest verticals for us and private wireless networks have shown significant promise. Manufacturers need private wireless for improved performance of automated guided vehicles (AGVs), predictive maintenance, augmented workers, tracking and positioning, and worker safety applications. Real-time data analytics is also essential for manufacturers as they look to both optimize their existing operations and implement transformative processes in response to macro market drivers for sustainability, responsiveness and people-centric operations.
“Other sectors, such as mining and logistics, are also seeing the benefits, but manufacturing currently leads in terms of growth, scope and implementation.”
How are customers scaling-up networks, venues, applications, workloads?
“We often see customers rolling out in one site or location and then move fast to multiple locations and regions. Examples include CP Chem and Flex. The pattern typically involves initial deployment in high-impact areas, followed by incremental upgrades and the addition of new applications and workloads as confidence and expertise grow.
“In 2022, many enterprises who had deployed private wireless technology were still at the proof of concept (PoC) or pilot stage, usually in a single location or single use case. In 2024, almost half of the enterprises surveyed in our industrial digitalization report (45 percent) are already taking advantage of private wireless networks with plans to do more than initially expected. One hundred percent of the 100 enterprises interviewed have started to roll out private wireless networks to more locations or expanded their use at the original locations for driving wider industrial transformation.”
How do you balance bespoke / customisation and scale / replicability?
“The replicability aspect is something we addressed early via close interaction with industry ecosystem players (such as Kone and Kalmar for ports)… [and also via] our vertical expertise, acquired through our segment experts and many deployments in industrial segments. Validation of key use cases and OEM solutions in our labs has led to the creation of vertical segment blueprints. We have today more than 10 segment blueprints and continue to expand and update these. [On top], our edge compute platform comes with all ingredients required for industrial digitalization – from connectivity (private wireless and Wi-Fi) to applications [and] pre-integrated devices.
“We have continued the blueprint journey by packaging and testing our one platform for industrial digitalization’ solution elements to deliver specific use cases. Recent addition is a worker safety package that hinges on our recently introduced VPOD solution running on MX GRID, but that comes with all the elements needed to provide key functionalities expected: worker connectivity for communicating alerts, automated stand-alone alarm modules, integration into third-party applications running on MXIE to automate alarm protocols, and so on. Our partners support further customisation of these solutions to customers’ specific needs and ecosystem environments.”
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Are customers going beyond connected workers and AGVs, yet, as primary use cases?
“While connected workers and pure machine connectivity (real-time data extraction for digital twin and processing, such as for predictive maintenance) are still common across all the segments we address, each industry segment has specific needs and tends to deploy whatever moves the needle most for them. For example, industrial segments with workers in dangerous environments tend to want to deploy solutions for site security, worker safety, and alerting systems. In ports, there is a big drive towards port automation, with the deployment of TOS, remote crane control, and fully autonomous straddle carriers.
“We see a big uptake in the demand for the use of drones in many segments, ranging from pipeline inspection in oil and gas, to reduce truck rolls and deliver more sustainable operations, to airports, where site and perimeter security is increasingly important. Customers are increasingly looking beyond connected workers and AGVs. Use cases now include advanced robotics, remote monitoring and control, augmented reality for maintenance, and IoT-driven asset tracking.”
Which channel is the best? Who understands enterprises well?
“Enterprises are gradually understanding the potential of private 5G, but the primary challenge is how to effectively leverage it. Education and a clear demonstration of ROI are crucial. All channels have been productive. In some countries, where regulation for enterprise spectrum is more restrictive, service providers have a stronger proposition. Otherwise, we’ve seen an equitable balance and we have witnessed some close collaboration between service providers and SIs where a client requirement or local regulation requires this.
“Service providers that have a strong background in enterprise managed services have had some success in transferring a solution selling and service management approach effectively into private wireless. Hybrid as well as neutral host / in-building DAS replacement solutions are fast-growing CSP propositions that are aligned with their strategies and investments and are enabled through our MXIE edge and our wireless connectivity apps.
“We have some very mature and fast-growing system integrator (SI) partners which typically have a deep understanding of enterprise needs and can tailor solutions accordingly. Historically, they have always had an ability to provide private wireless as a discrete managed service. Increasingly, we are seeing major SIs integrating Nokia DAC and [MXIE] into their existing solutions for IoT solutions, AI-ops, OT-digitalisation, security, and ERP/IT system deployment. As these value propositions and solution blueprints take hold, we see private wireless networks becoming very much part of the fabric of the SI’s core propositions, especially as they drive greater R&D and services focus towards OT AI, where we see private wireless playing a critical role.
“We have also seen a range of niche consultancy / SI firms with expertise in elements of cellular networking, pivoting quite effectively to leading and closing enterprise engagements – often with some unique or innovative element. An example of this has been some of the newly emergent drone based business models.
“A sign that enterprises are maturing in their approach to private wireless can be seen in the increasing number of RFPs or client engagements that are focused on a common global architecture, delivery and services model for private wireless. We see this trend pretty much across all MNC sectors including mining, natural resources, discrete and process manufacturing, logistics, and so on. Amongst smaller or regional ports, utilities, and manufacturers and mines, we have seen similar interest, as some of the use-cases and benefits become more commonly understood and become part of standard enterprise architectures.”
How integrated is 5G into IT – in terms of user control and policy management?
“Private wireless networks are integrated in IT systems, but the integration depth is often very pragmatic (when required). Integration of operations and management (O&M) systems is an obvious one if the IT team will manage the network. Many decisions on integration rest on every single customer’s policy: whether the IT architecture is site-by-site or centralized; whether the IT team is in-house or outsourced, what their responsibilities are. Since private wireless serves OT use cases mostly, deployments are run as independent networks, tightly integrated in the rest of the OT systems and with light integration on the northbound side.”
Is there a scale issue with IT/OT – insofar as, once proven, IT seeks to impose 5G on OT unilaterally? Does this cause friction?
“This is very dependent on the involvement of IT – which in the industrial segment is often [as] consultants rather than decision makers. Education is required for IT teams to not create friction and for them to understand the need, but the deployment trigger almost always comes from OT as OT is responsible for the site’s KPIs, the means to achieve it, and the budget for the project. Since many large companies outsource their IT, it is not unusual for the OT teams to be fully in charge of private wireless… Our solution now goes beyond connectivity and closer to use cases (edge compute with applications), and we provide solutions to ease integration with IT and OT systems. [As such] our interfaces become more and more OT centric.”
Does IT properly understand the SI / RAN complexity to scale 5G to multiple sites?
“The scaling is not very different to the initial deployment – if IT was only involved at a high level [in the first place]. Still, in many cases, once OT brings private wireless to the IT table, IT folks are keen to understand the rationale and benefits… and to support their OT colleagues as best as possible. That tends to ease deployments in other sites. Except when the network management is centralized, most deployments are site-centric, and driven by a given site’s budget/imperatives – and hence IT learning from one site to the next is not a given. The exception is when the private wireless deployment is driven by a corporate Industry 4.0 project.”
How / when does this all become easier? When does it fly, and what will that take?
“OT transformation is a marathon not a sprint. OT environments are complex, heterogeneous, and highly fragmented. While OT teams need to implement innovations, they also need to keep their operations running 24/7, maintain their KPIs, keep workers safe, and so on. In OT, every single use case is made of many machines, systems, apps, sensors – all coming from different vendors, all talking different languages, all interacting with one another.
“It is because of this that the migration to private wireless requires some time. Once you deal with one use case or one product line, you can move to the next one to avoid disruption. From our side, the whole ecosystem needs to work together to make things easier, which is what is starting to happen – in terms of vendors making solutions easier to use and integrate; partners understanding what it takes to tightly integrate private wireless into legacy systems and tap into innovative approaches and architectures; and ecosystem players understanding what this innovation can bring, and how to integrate it into a new range of solutions.”