Over the past decade, increasing numbers and types of organizations have recognized that employees must be able to work seamlessly and securely from anywhere, with bandwidth that lets them handle large amounts of data and services. As more workloads become digitized and shift to the cloud, companies have even greater incentive to rethink their physical footprint. Businesses have coped relatively well during the extended remote working the pandemic has brought, but it has become clear that Wi-Fi and our current devices are not enough for much of the workforce. Employees away from the office need better options than juggling cellular and Wi-Fi dongles and passwords to access secure, reliable, and adequate Wi-Fi.
These concurrent trends make an existing solution—cellular-enabled mobile computing devices—an attractive candidate to complement Wi-Fi. In addition to the rapidly changing needs of the workforce and likelihood that most companies will embrace a mix of remote and on-site work post-pandemic, the form factor of such devices is improving rapidly. At the same time, 5G is on the cusp of at-scale rollout, which promises increased signal reliability and enables pricing innovations in cellular connectivity. As a result, cellular-enabled devices could serve to help organizations be more customer-centric and efficient, allowing employees to work more flexibly and responsively with access to the data and collaboration tools wherever they may be. This development could benefit both sides of the equation, offering employers paths to more effective talent management as a result of workers experiencing more agency and less friction in doing their jobs, and giving employees access to a wider pool of potential employers and positions from which to choose.
Accelerating trends and challenges
Even before COVID-19 upended workplaces, there were already trends and challenges developing to support the expansion of use cases for cellular-enabled mobile computing devices. Growing globalization and increasingly complex security, technology, and competitive landscapes make managing workforces, devices, and data more challenging. The work to be done and the people doing it are more dispersed, bringing collaboration and security challenges. And on top of all that, the competition for talent has created a need for employers to look farther afield for candidates— beyond the immediate commute-able area around existing offices—and be more willing to allow employees to work remotely.1
The arrival of COVID-19 accelerated those existing trends. The need for business to be conducted virtually has pushed organizations to rapidly advance their digitization, including that of their supply chains, customer channels, employee interaction, and use of automation and AI. Increased activity in file sharing, videoconferencing, collaboration tools, data, and analysis tools has fueled this imperative for change. Businesses need to be able to allow customers and suppliers to interact with them digitally through multiple channels at all times. The unplanned, pandemic-induced redefinition of the workplace will create a mix of remote and on-site working models with one consistent theme: workers need to be flexibly, reliably, and securely connected. (For more on the future of remote work, see the article, “What’s next for remote work: An analysis of 2,000 tasks, 800 jobs, and nine countries,” November 2020, McKinsey.com.)
Smartphones paved the way for the connected workforce, but today’s workers need far more than email and some enterprise applications at their fingertips. They need the ability to work anywhere, anytime with full keyboards, larger screens, and more compute power. Wi-Fi is not enough to run all of this, in particular home Wi-Fi, which is often spotty, without an enterprise-grade broadband connection and professionally-installed local networks.2 Cellular networks are a good backup, but current methods of connecting securely to them are not seamless, requiring tethering to mobile phones or devices such as cellular and Wi-Fi dongles.
Cellular-enabled mobile computing devices may well be the answer. They not only offer high-bandwidth, relatively reliable, and secure connectivity instantly, from most urban or suburban locations, but also offer improved compute power (Exhibit 1). While providing a more seamless and flexible connectivity experience with less of the friction caused by passwords for secure Wi-Fi or Mi-Fi, cellular-enabled devices can also allow for more uninterrupted connectivity if other networks are inefficient (for example on a large hospital campus that has many buildings, or saturated networks). Finally, they can enhance security by using additional features built on top, such as user-authentication that monitors real-time behavior via keystroke characteristics, for example, or leveraging licensed cellular carriers’ own security capabilities.
Potential paths to adoption
Cellular-enabled mobile computing devices are not new. These devices have been around since the advent of 4G mobile telecommunications just over a decade ago, but have been viewed as a niche item mostly for high-end enterprise use, and even then reserved for a select group of individuals. Only about 4 percent of laptops and notebooks are cellular-enabled, compared with 35 percent of tablets.3 The barriers to adoption have been the high prices of the devices and cellular-connectivity packages, as well as low battery life. Most importantly, until the pandemic, the vast majority of workers didn’t really need them, because they primarily did their work on-site with either high-quality, secure Wi-Fi, or hardwired connections. The relatively few users have mainly been top executives, road warriors such as consultants, and workers with very specific compute and connectivity requirements such as telecom field force teams.
Until recently, the opportunity for growth was seen as people whose work is increasingly connected, but who do their jobs in settings where Wi-Fi is scarce, or requires them to move often between variously connected settings, such as healthcare and construction workers. (See the sidebar, “Use cases for cellular-enabled computing devices” and Exhibit 2.) But now, given the expected continuation in remote or at least hybrid working arrangements, the need for cellular-enabled mobile computing devices appears potentially much broader. This comes at a time when the form factor of such devices is becoming more user-friendly, the economics of providing them are improving, and higher-speed 5G is rolling out.
In addition to the sudden change in the way we work, trends across three dimensions—the cellular technology foundation, total cost of ownership, and enterprise user needs—appear poised to create the market conditions to accelerate adoption of cellular-enabled mobile computing devices.
Improved technology foundation
Today only a handful of 5G cellular-enabled laptops, notebooks, and tablets are on the market, but all of the main manufacturers are developing a wider array of mobile computing devices in anticipation of increased user demand and willingness to pay for cellular connections.4 Also, 5G infrastructure deployment at scale is already under way and spectrum allocations have started, though both may be slowed a bit by COVID-19 safety restrictions.5 At the same time, virtual SIM card capabilities—e-SIM—are being launched to allow flexible network provisioning for enterprise users. Certain semiconductor players have already launched mobile computing chipsets with e-SIM capabilities.
The devices themselves are also improving at a very fast rate, gaining more compute power, longer battery life, and powerful AI chipsets. The combination of these technological advances will unlock even more enterprise use cases such as real-time security threat detection and device-to-device connectivity.
Total cost of ownership expected to drop
Cellular-enabled devices currently command a premium of approximately $500 for 5G capability, and upgrading a 4G-enabled device to 5G runs about $200 to $300. (At the same time, an enterprise can help defray some of those additional costs by commanding corporate discounts of 20 to 50 percent depending on the size of its fleet or total IT spend.) These premiums are anticipated to go down quickly as new 5G-enabled devices are introduced to the market.
As for the cellular connectivity required to run the devices, operators are expected to innovate more on pricing as 5G rolls out. Switching to a 5G-enabled laptop today would cost about $35 to $40 per device per month in the United States. To upgrade from an LTE-enabled device to 5G, the additional service cost is almost negligible. Currently, enterprises acquire these connections either as pooled or separate SIM card connectivity. Based on our estimates, we expect the total incremental cost of migration to cellular devices for about a third of employees at a large bank to be marginal, less than 1 percent of total IT spend over a three-year period. Shifting a much smaller pool of employees, around 2–3 percent, at a hospital would incur a similar incremental cost (see sidebar, “Estimating the total cost of migration”).
Operators still have room to innovate in how they charge customers as a means of accelerating adoption of always-connected devices. One idea could be to offer unlimited or tiered data packages to enterprises up to a certain number of devices, and charge incrementally for each new device added to the fleet. Some operators are experimenting with bundling the cellular-enabled mobile computing devices with productivity suites as well as managed services such as help desk, SIM management, or license management.
Changing enterprise user needs
As cloud adoption advances and SaaS-based services such as productivity suites proliferate, more work is getting digitized, increasing the need for connectivity.6 Customer demands are also changing, toward more seamless digital interaction with service providers. For example, in financial services, digital is quickly becoming the default channel for most customers. Remote advisory is fast becoming the primary way to serve customers with complex needs—20 percent of consumers are willing to use remote advisory for complex needs now, and intent to use bank branches has decreased 15 percent since the pandemic started.7 Similarly, healthcare remote-care use cases are increasing, including telemedicine visits, patient monitoring, and many other consultations or collaboration with other hospitals.
Cybersecurity, already at the top of CIOs’ agendas, is another area of changing enterprise need. Attacks are becoming more sophisticated every day, and the increased digitization of workloads and growing data volume—especially of sensitive records—combined with growing numbers of workers connecting remotely poses new challenges for IT leaders. Further, with the rising ranks of workers accessing networks from home, the trend of bring-your-own-device (BYOD) heightens the vulnerability in the network and threatens end-devices that were previously protected within the enterprise office perimeter. Given the extent of the potential IP and monetary loss, CIOs appreciate the value proposition of additional security features that cellular-connected devices can provide. For example, the fact that they are always connected means enabled devices enjoy shorter authorization times, reduced or no idle time while security updates install, and fewer malware infections.
How to think about adopting always-on devices
There are many factors to take into account when considering adopting cellular-enabled mobile computing devices. Chief among them is workplace culture. Technology has already significantly contributed to creating an always-on workplace culture, with many employees feeling burned out when the boundaries between work and home get blurred.8 Asking employees to use always-connected devices can potentially worsen their morale on this front. Still, businesses need to accommodate customers who expect 24/7 services and support, and cellular devices offer both employers and employees a range of likely benefits to offset the potential downside (see sidebar, “The benefits of a flexibly, reliably connected workforce”).
It’s up to employers to figure out how to create a healthy, sustainable workplace in the face of these potential complications. Used appropriately, alwaysconnected devices can actually help with that, by allowing employees greater flexibility and control over where and when they work. To determine whether always-connected devices are a good fit for their workplace and how to deploy them effectively, organizations should take the following steps.
Define the use cases that unlock value for your business. Employers should clearly define use cases where seamless connectivity drives incremental value to new business and product development, operational performance, or employee satisfaction. These should either enhance and improve already defined processes and practices, or enable new, innovative pathways to operate.
Enable users according to their connectivity requirements. The connectivity needs of different employee groups vary significantly, and will evolve over time. Organizations should seek to tie decisions around which roles to adopt always-connected devices to the value of the use case (Exhibit 3).
Analyze the ROI of the investment. Though the total cost of ownership of always-connected devices is becoming more attractive, creating a more connected workforce is an investment that needs to be justified. Rigorous definition of use cases will help evaluate qualitative and quantitative benefits. Besides direct costs, there are other cost-related factors that should be taken into account, such as ease and cost of deployment and expansion of existing support capabilities.
Validate compatibility and compliance. The connected workforce introduces a next level of complexity into device management. Creating relevant policies and having the right capabilities, including both talent and processes, to do so is crucial to complying with security requirements and ensuring operational effectiveness. The newer generations of always-connected computers offer enhanced security features, but by definition, the ability to work from anywhere limits standard on-premises security protocols. A decision to migrate to always-connected devices must be preceded by a set of compatibility and capability questions such as: What is the level of backward compatibility? How mature are the devices? Do they require building additional internal deployment and support capabilities to ensure smooth operations? Are they compatible with preferred platforms and products?
Monitor employee satisfaction and engagement. Finally, once always-connected devices are introduced, organizations should carefully monitor employee satisfaction and address any negative effects the devices bring to the culture. Left unchecked, such effects can render investments in further connectivity counterproductive—overall hours worked may increase, but productivity may sag due to negatively impacted cognitive and mental performance.
The factors that fuel the ongoing discussion of how the workforce of the future will be organized have been deeply affected by the pandemic. As organizations settle into their next normal of some mix of remote and on-site work, cellular-enabled mobile computing devices appear to have increasingly numerous and viable use cases. This shift coincides with technological advances and changes in the economics of these devices, making widespread adoption increasingly possible.
Positioning this level of connectivity as a powerful enabler for enterprise growth and employee satisfaction will depend on how well employers deploy them. Employees should be given the option, rather than the obligation, of working flexibly from anywhere using an always-connected device. Many will find they improve their work–life balance, but some will not. Companies should take great care to ensure that their workplace cultures are enhanced, not harmed, by the addition of such always connected work tools.