5G Beats AI as Top Enterprise Investment

The telecommunications sector is witnessing a definitive realignment of enterprise priorities. While Artificial Intelligence (AI) captures the cultural zeitgeist, the foundational layer required to support it—advanced connectivity—is asserting itself as the primary capital requirement. 

Without robust networks, the promise of digital transformation remains theoretical. The reality is driving a reassessment of budget allocation among global technology leaders, who are increasingly identifying legacy infrastructure as the primary bottleneck preventing them from capitalising on emerging technologies.

Ross Hockey, Ericsson’s Senior Director EMEA, Solution Service Providers, highlights the shift in strategic thinking, noting that the limitations of older systems are now the primary catalyst for investment.

“Connectivity is fundamental for innovation and businesses are steadily growing more aware of this,” says Ross.

“Ericsson’s latest State of Enterprise Connectivity report reveals legacy infrastructure is restricting businesses’ ability to capitalise on emerging technologies, such as AI.

"This is one of the reasons why 69% of tech decision-makers recently surveyed by Ericsson state 5G is the best investment they can make over the next 12 months to remain globally competitive, ahead of robotics and automation (45%) and even AI (42%),” he adds.

Navigating the deployment deficit

Despite the clear financial imperative, the transition from legacy systems to 5G architectures is rarely straightforward. Organisations are grappling with unique friction points that stall deployment, creating a gap between ambition and execution.

“While business leaders are aware of the revolutionary potential of future-ready networks, many still encounter major adoption obstacles, ranging from complex regulatory environments to a lack of skills within their organisation and shrinking budgets,” explains Ross.

He adds: “Overcoming these challenges is crucial if businesses want to fully unlock the benefits of next-generation technology.”

The industry response has been to shift the burden of complexity away from the enterprise.

The ecosystem has matured to a point where the heavy lifting is shared across the channel, allowing vendors and operators to bridge the skills gap.

“Fortunately, the 5G ecosystem has now reached a stage where connectivity providers, channel partners and hardware providers can truly help companies become more agile and dynamic,” Ross continues.

“This is the driver for Ericsson’s continuous evolution, especially through our partner programme, adopting a new channel-centric model.

"We want to design the best benefits and support for partners and carriers as they help their customers convert to wireless connectivity and cellular networks,” he adds.

Resilience in the retail sector

The evolution is most visible in high-demand verticals like retail. In the UK and Europe, the conversation has moved beyond simple bandwidth to critical resilience.

The operational risks of outdated infrastructure are no longer hypothetical, as demonstrated by recent high-profile security breaches that have exposed the fragility of legacy systems.

“5G networks have finally reached a point where they can create a significant difference for enterprises.

"Businesses across the UK & Europe are more focused than ever on ensuring their networks are resilient and modern enough to withstand demands on data and also secure against cyber threats,” says Ross.

He adds: “In particular, the recent ransomware attack on M&S earlier this year demonstrates how even reputable companies can become exposed if their outdated infrastructure isn’t prepared to handle modern digital threats.”

The recognition of such vulnerability is widespread, driving a consensus that modernisation is a survival necessity rather than a luxury.

“In fact, 89% of retailers in the UK & Europe believe next-generation connectivity is required if they are to unlock business innovation, including AI and IoT deployments,” notes Ross.

“This growing recognition emphasises how important scalable, modern connectivity is. However, often enterprises lack the in-house technical expertise needed to successfully take advantage of it.

"Carriers have noticed the trend, building solutions around products like Ericsson’s WWAN portfolio which is making it simpler to deploy and upgrade,” he adds.

The carrier pivot and commercial reality

The pivot and reality create a distinct opening for telecommunications operators. The historical reliance on consumer subscriptions to fund infrastructure rollout is proving unsustainable in the 5G era.

The economics of the network are necessitating a pivot toward the high-value enterprise segment where performance guarantees command a premium.

“The potential of 5G for carriers extends far beyond the consumer industry. Many now understand that it will be challenging to recover investment through consumer use of 5G networks alone,” Ross states.

“Long-term value and differentiation lie in enterprise-grade connectivity. Carriers are in a unique position to provide the high-performance, secure networks that businesses require to support automation, AI and data-driven operations at scale,” he adds.

"The strategic pivot is already translating into commercial activity, with a marked increase in B2B engagement as operators move to capture the value.

“We are truly beginning to see traction. We’ve introduced 5G business proposals with three to four times as many carriers in the last couple of months as we had over the previous few years, which is a definite indication that the industry is evolving.”

Integrating AI and Network Slicing

As the industry looks to the immediate future, the interplay between network management and AI will define the next phase of rollout. The complexity of managing sliced, virtualised networks requires automated intelligence to ensure efficiency.

“The focus for the upcoming year will be on continuing to convert interest into momentum,” says Ross.

He adds: “In close collaboration with carriers, Ericsson will keep integrating new technologies like automation and AI into network management to improve system responsiveness, efficiency and scalability.”

The advancements are streamlining operations, allowing complex technical capabilities to function invisibly in the background while delivering tangible commercial results.

“Meanwhile, advances in AI are making the management of networks simpler, troubleshooting problems and enabling technological advances like dynamic slicing,” Ross adds. “For example, network slicing is being used by retailers to support millions of pounds worth of sales at big events, while the wider network is providing better connectivity for hundreds of thousands of people.”

Ultimately, the utility of these advancements is best measured by the tangible outcomes they deliver for specific verticals, from logistics to large-scale event management.

Roiss concludes: “Supporting industries like retail, where 5G and network slicing are already enabling smarter customer experiences and sales at large-scale events and fleet management, where faster in-vehicle connectivity allows for real-time tracking, predictive maintenance and increased safety, will be a key priority.

"It’s critical that we keep helping industries become safer, smarter and more efficient with connectivity that is not just faster but also purpose-built for the demands of the digital economy.”