Australian firms cite connectivity costs as barrier to 5G adoption

Australian businesses are facing significant connectivity issues that are limiting their capacity for innovation, growth, and effective sustainability practices, according to findings from Ericsson's annual State of Enterprise Connectivity report.

The study, based on research conducted by Censuswide and surveying 500 medium and large Australian businesses, identifies persistent barriers including the high cost of network deployment and ongoing maintenance, as well as infrastructure gaps that are hindering business development and productivity.

Network investment

Australian organisations were asked about their investment in advanced connectivity.

The report finds that more than 87 percent believe that establishing more secure, reliable and high performing networks such as 5G is pivotal to positioning the country as a world-class industrial and technology leader. Similarly, more than 85 percent agree that these next-generation connections are key to unlocking business innovation involving artificial intelligence (AI), the Internet of Things (IoT), and accelerating research and development efforts.

Despite this acknowledgement, a majority of respondents said that current infrastructure remains inadequate to properly implement these initiatives. The survey shows that 44 percent of businesses are already using 5G to enable AI and machine learning applications, but many others are still at an early stage in their 5G deployment journey.

The main constraint cited is the perceived expense of rolling out and maintaining 5G wireless networks.

Forty-eight percent of surveyed businesses reported cost as their primary concern, a notable increase from the 30 percent recorded in the previous year's report.

Sustainability and data

The report explores the role of connectivity in advancing sustainability. Seventy-three percent of businesses surveyed said that increasing government reporting requirements are driving their efforts to cut carbon emissions, but they also highlighted the essential contribution of reliable connectivity to achieving decarbonisation goals.

According to the findings, 80 percent of participants agreed that high-performance, reliable connectivity is fundamental in addressing climate change, as it enables the widespread adoption of IoT and smart devices for tracking progress and enhancing operational efficiency. Furthermore, 83 percent of respondents believe that improved connectivity would allow them to better track sustainability targets, while 75 percent indicate that limited connectivity in remote areas is hampering their ability to accurately capture emissions data.

Remote and on-site work

Australian businesses are also dealing with persistent connectivity challenges both for remote and on-site work environments.

The research shows that 59 percent agree that working from home results in connectivity difficulties, and 54 percent note similar issues when employees return to office settings. Improving office connectivity is identified by 54 percent as a top factor for encouraging staff back into the workplace.

The survey further examines the role of satellite connectivity, particularly for regional operations. Thirty percent of organisations use satellite services in conjunction with cellular networks. For those not utilising satellite solutions in regional or rural areas, over 46 percent cite cost-related barriers as the main deterrent.

Industry response

Findings from Australia's State of Enterprise Connectivity survey underscore the critical need for Australian businesses to address connectivity challenges to unlock innovation, enhance productivity, and achieve sustainability goals. With significant interest in 5G and combined cellular satellite adoption, and the recognition of the potential benefits of these connectivity solutions, overcoming perceptions around cost and skills gaps will be essential in positioning Australia as a global leader in innovation.

The report also contextualises Australia's relatively low business research and development expenditure compared to comparable economies. This, coupled with the broad consensus on the importance of robust digital infrastructure, highlights the urgency for investment in network technology to enable businesses to compete on the global stage.

Australian businesses are facing both structural and cost-related barriers as they seek to expand the use of advanced network infrastructure, with a substantial proportion recognising the benefits in productivity, innovation, and sustainability outcomes. The findings suggest that addressing these barriers through strategic investment and policy support will be crucial for future growth and competitiveness.