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5G, SD-WAN and the future of connectivity

Paul Landsman discusses how 5G and SD-WAN are transforming the future of connectivity, and the prize on offer to MSPs that can effectively manage these technologies. 

Ready, steady go. The prize on offer for those countries and enterprises that are quickest to adopt the next generation of connectivity technologies could hardly be more valuable. At a national level, the adoption of technology such as 5G and SD-WAN will drive a step-change in their economies, changing existing models of work and seeding whole new industries. The combination of these tools by companies will transform speed, agility and capacity - and give the frontrunners a significant competitive advantage.

 

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What is 5G?

5G is a shorthand way to describe the fifth generation of mobile networks; telecoms providers in the UK currently operating 4G networks have already begun to trial and introduce their 5G alternatives. These employ higher radio frequencies that are less cluttered and able to carry more information at a faster rate.

Indeed, speed is the biggest selling point of 5G, with the next-generation networks promising to move data up to 100 times’ more quickly than conventional 4G networks. Capacity will also improve dramatically, as will latency – the lag between a command being issued on to the network and response being received. It will also be possible to slice up the network into small portions, with businesses able to command their own share of the network.

For users, these gains offer many tangible benefits, underpinning technologies ranging from self-driving cars to virtual reality. These promise to change the nature of work, enabling remote working for huge numbers – and may even pave the way for new products and industries. Qualcomm has predicted that 5G could create 22 million jobs and generate up to $12.3 trillion of products and services by 2035.

What is SD-WAN?

The WAN in SD-WAN stands for “wide area network”. A wide area network uses a connection such as broadband internet or 4G cellular to link computers that are spread across significant physical distances – in different cities, for example, or even in different countries.

 

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SD stands for “software-defined”, meaning that the network can be programmed or controlled from a single central point using a software application. SD-WAN architectures are therefore used to connect and manage organisations’ WANS – their office networks or data centres, say – over long distances. For example, the plumbing supplies group Reece has implemented a Cisco SD-WAN solution that enables its network administrator to manage the networks, devices and applications, including those hosted in the cloud, of 500 outlets spread across Australia and New Zealand from a single point.

The market research analyst Gartner believes the use of SD-WAN is about to leap forward, citing research suggesting 61% of large organisations will move to this technology in the next 12 to 24 months, joining 33% that have already made the move or are in the process of doing so.

This adoption rate reflects the potential benefits that SD-WAN offers. These include improved resilience and business continuity, enhanced security, superior performance and the potential for cost savings as organisations are able to move away from using more expensive convention telecoms networks.

The power of combination

SD-WAN will be crucial to the roll-out of 5G networks, which are powered by small cells that must be installed more densely than the infrastructure currently required by 4G. The much greater density of these base stations means they will require careful management to optimise performance – effectively, operators will be running large numbers of networks that must work together to deliver 5G services and connectivity.

The solution is SD-WAN technology, which provides operators with a way to connect all these networks, often across significant physical distances, and then to manage them from a single point. They’ll be able to securely and intelligently direct traffic across the networks, improving performance and enhancing the user experience.

 

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From an investors’ point of view, managed services providers that can manage 5G networks using SD-WAN tools will have an important and highly attractive source of competitive differentiation. The pressure to embrace these technologies will grow quite rapidly – especially as the internet of things, which is rapidly connecting billions of devices to networks, continues to accelerate. As many organisations will lack the expertise to exploit 5G and SD-WAN in-house, they will rely on specialist developers, integrators, providers and consultants. That offers a really exciting future for providers that can offer these services.

Please get in touch on investments@livingbridge.com if you’re interested in finding out more about funding and where we’ve helped connectivity providers in the past.

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