Carrier networks need increased flexibility as they juggle 5G with legacy technologies
This year, carriers across the globe will be considering how they can cost-effectively roll out new 5G networks, whilst reducing complexity in their legacy 2G/3G/4G infrastructure.
In developing markets, carriers face the challenge of delivering 2G, 3G, and in some areas, 4G. They must do this while meeting their financial targets, which is challenging given the typically low average revenue per user. Carriers’ networks must be flexible to support more users and higher bandwidth services. They must also be easily upgradeable to new connectivity standards, as and when there is the demand for advanced mobile use cases.
In many developed markets, the race for 5G commercialization is in full swing, and operators are spending considerable amounts of money building out their 5G network capabilities. These networks must be designed to support a wide range of new and existing use cases. But developing 5G isn’t the only challenge. The GSMA forecasts that 5G won’t become the primary mobile standard until 2025 in the U.S.; this is a trend which is likely to be common across many Western countries. Carriers are focused on ensuring that they can cost-effectively deliver high-performance 4G/LTE connectivity to the millions of consumer and business users that won’t be adopting 5G for a number of years.
In both developing and developed markets, carriers are now realizing that the economics of building their radio networks need to change. They will struggle to be profitable if they maintain the approach of building and managing siloed networks for each network generation, as CAPEX and OPEX will skyrocket. Traditional RAN vendors – such as Huawei, Nokia and Ericsson – are also barriers to network development and profitability. Their technology is not interoperable with other vendors and is very difficult and expensive to adapt and upgrade once it’s been deployed.
Vodafone recently noted that “the global supply of telecom network equipment has become concentrated in a small handful of companies. More choice of suppliers will safeguard the delivery of services to all mobile customers, increase flexibility and innovation and, crucially, can help address some of the cost challenges that are holding back the delivery of internet services to rural communities and remote places across the world.”
Carriers need a new approach to open up and unify their networks. That is why many companies in the telecoms industry are enthusiastic about the prospect of OpenRAN. The objective of OpenRAN is to use 3GPP-based components to create a fully programmable and open RAN infrastructure. This is achieved by disaggregating hardware and software in the network. This can give operators the flexibility to cost-effectively deploy and upgrade their networks, reduce complexity, and deliver coverage at a much lower cost.
In a mobile operator survey by Senza Fili, 43% of respondents said they would consider replacing their current equipment vendors when deploying OpenRAN; a quarter of respondents named cost savings as a reason to consider multiple vendors. The resulting CAPEX cost benefits of selecting OpenRAN hardware are significant as it is reducing dedicated CAPEX hardware costs.
One RAN to rule them all
Mobile operators need an OpenRAN solution that supports all generations of mobile networks – 2G, 3G, 4G and 5G – under the same software umbrella. Through a dynamic, cloud-native approach to OpenRAN, operators can address their pain points as they look to introduce new networks and manage existing infrastructure more efficiently.
OpenRAN technology that is fully virtualized and encompasses all different controllers, gateways, core and edge functions that are used in today’s networks allows operators to reduce complexity and make network maintenance less resource intensive. This is crucial as carriers look to deploy 5G while simultaneously reducing costs of legacy networks.
OpenRAN delivering proven results today
OpenRAN is already making waves across the industry. For example, at TIP Summit 2019 in Amsterdam in November, Vodafone announced that it would be opening its entire RAN in Europe to OpenRAN vendors. In the UK, BT is involved in OpenRAN trials and is working with TIP. Meanwhile, MTN, the South Africa-based operator, recently announced that it is deploying OpenRAN technology in 5,000 sites as it looks to unify its 2G, 3G and 4G networks, to reduce costs for itself and its customers.
Carriers looking to reduce costs and drive flexibility and innovation into their networks should transition to an OpenRAN architecture as soon as possible, or risk paying more to deploy 5G. Analysts’ projections of a 5G Macro-cell deployment cost show pricing falling by 50% until 2022 if it is built around an open architecture, whereas it will only fall by 30% if built in the traditional way. The 20% difference is hundreds of millions of dollars in the overall TCO and will help mobile operators extend investments and become more profitable. Taking a cloud-native approach to network development removes the economic constraints of today’s networks, making them easy to install and manage.
By putting software at the heart of the network, operators can start introducing best-in-class vendor technology that can help them reduce the cost of using traditional vendors. They can deliver high quality end user experiences and introduce new networks to support all uses cases, regardless of the market they operate in.
Vodafone will deploy OpenRAN across their properties in Europe. Vodafone’s tender will cover more than 100,000 sites and 400 million people across 14 countries. “Right now this is the biggest tender in this industry in the world,” Yago Tenorio, head of Network Strategy and Architecture at Vodafone said at TIP Summit 2019. “It’s a really big opportunity for OpenRAN to scale. We are ready to swap out sites if we have to. Our ambition is to have modern, up-to-date, lower-cost kit in every site.”
Telefónica plans to connect 100 million people in LATAM with OpenRAN, and MTN plans to deploy TIP OpenRAN technology at 5,000 rural sites in Africa. There are over 70 (!) mobile operator members now in the TIP OpenRAN membership roster. TIP supports low cost, more competition, and recently started PlugFests to accelerate interoperability between the vendors, to create a tangible ecosystem, and finally encourage trials (8+ more are on the way).
2020 will undoubtably see more operators take steps towards cloud-native and with open networks, and we can expect OpenRAN to dominate MWC20 Barcelona and beyond.
