Private mobile networks are becoming increasingly popular in the utilities sector as they provide a reliable and secure communication platform for critical infrastructure. However, the decision to deploy a private mobile network involves significant costs beyond the initial investment in equipment and infrastructure. The Total Cost of Ownership (TCO) is a comprehensive financial analysis that takes into account all the expenses associated with owning and operating a private mobile network over its lifetime. In this article, we will explore the elements that make up the TCO for private mobile networks in utilities.
Capital Expenditures (CapEx) Capital expenditures are the initial costs incurred in purchasing equipment and infrastructure required for deploying a private mobile network. In utilities, this includes base stations, antennas, routers, and other equipment. The cost of CapEx will depend on the size and complexity of the network and the level of redundancy required for reliability. Generally speaking, the centralized approach of local LTE networks have a much smaller CapEx than alternative technologies.
Operating Expenses (OpEx) Operating expenses are ongoing costs associated with running a private mobile network. This includes expenses related to maintenance, repair, and replacement of equipment, licensing fees, and utilities such as power and cooling. The OpEx will depend on the size of the network, the level of redundancy required, and the operating environment. Technologies such as Wi-Fi require so much hardware, that the impact is not limited to CapEx. Maintenance, repair and all the other factors mentioned aren’t favorable on the OpEx side either. Local LTE networks are extremely attractive from this financial perspective in almost all scenarios.
Personnel Expenses
Personnel expenses include salaries, benefits, and training for the staff required to operate and maintain the private mobile network. In utilities, personnel expenses are particularly significant as the network often requires specialized skills and expertise.
Network Management Expenses
Network management expenses include the cost of software, tools, and personnel required to monitor and manage the network. This includes the cost of security measures and network upgrades.
Downtime and Disaster Recovery Costs
Downtime and disaster recovery costs are expenses that arise from unexpected outages or disasters that affect the private mobile network. This includes the cost of repairing and replacing damaged equipment, the cost of downtime, and the cost of business disruption.
Conclusion
Deploying a private mobile network in utilities involves a significant investment of time and resources. The TCO analysis provides a comprehensive financial assessment that considers all the costs associated with owning and operating a private mobile network over its lifetime. Understanding the elements that make up the TCO is essential for utilities to make informed decisions about whether to deploy a private mobile network and how to optimize its operations.
