Supply Chain Management

Any Downsides to 5G in Supply Chains? Yes.

While 5G will deliver high efficiency, there will also be challenges for those implementing it, from the sheer volume of data to a disconnect in the available infrastructure to support it. 3G and 4G implementation was far from painless. Expect similar woes with 5G supply chain implementation.

Of major concern is that you can’t just take yesterday’s data infrastructure and expect the backbreaking increase in speed can handle it. Another important consideration is the 5G New Radio (SA 5G NR) that is ratified but not yet clear is how 5G, LTE Advanced and Wi-Fi will combine in new apps. At this stage, there is confusion as to what to do regarding design, available components, support and how to keep all of that new data safe.

So far, specific challenges include:

  • Suppliers with product roadmaps that are yet unclear as to 5G
  • Putting new supply chain relationships in place to take advantage of new requirements
  • Keeping costs in check with so many unknown factors
  • The supply of engineering talent with sufficient expertise necessary to build 5G products
  • The availability of 5G test equipment based on new standards
  • What will be the costs associated with local networks for 5G?

The issue of safety/security is paramount. Huawei was long said to be a 5G network leader has experienced continued pressure from the Trump administration based on the potential for the Chinese government to use a network backdoor for spying.

According to a CNBC interview at the World Economic Forum in Davos, Switzerland, with Ericsson CEO Borje Ekholm, China’s Huawei is not the 5G leader and that no one is ahead of Ericsson with 5G. So far, the U.S., Japan and South Korea have launched 5G networks and Britain and Germany will soon decide on using Huawei for their 5G networks.

Aside from the question of Huawei and security, the use of such structures as an operating data lake will need to exist for 5G adoption. The central repository will store data for use by a variety of analytics options and dashboards.

5G adoption, infrastructure and build-out will likely take a bit longer than projected. It will, however, according to MarketWatch research reach a global market size of approximately $90 million by 2023.