A RAN-away Telecom hit

There has been a growing call to open up the RAN, or radio access network, portion of the network infrastructure. The RAN is the part of the mobile network that sits between your smartphone or any other end-user device and the core telecom network. The RAN handles the reception and transmission of the wireless signals used to communicate between devices and the main network (and then out to the cloud), so it plays a critical role for applications like network slicing.

The RAN portions of wireless networks are significantly more distributed. While that makes it harder for larger portions to go down at the same time, it makes it much more challenging to upgrade all the different pieces that need to be upgraded in order to make this transition to an open, software-controlled, virtualized environment. Directly related to all of this is that the mindset of many telco network providers is more like that of a utility than it is a cutting-edge cloud computing service.

Even within these constraints, we’ve started to see some important movements towards a more open, virtualized network environment. There has also been growing interest in Open RAN technologies from a number of other places. Traditional computing and data networking hardware and software vendors as well as cloud providers like Amazon and Google have been eager to see telcos move into technologies and platforms for which they have a wide range of capable offerings.

Carriers have also started to talk more on the potential for Open RAN. As with the first enterprise data centers that started making the move to cloud computing many years back, the big US carriers have a huge installed base of legacy equipment that they can’t just easily switch out. As a result, even though there’s strong interest in moving to more modern network infrastructures, the move to Open RAN is clearly going to be a multi-year process.

Open RAN promises to bring disruption to operators in the form of lower capital expense, accomplished by the disaggregation of general-purpose hardware and software for base station deployment. Given the US administration’s concerns on being reliant on foreign companies for cellular infrastructure, much of the dialogue has been tied to Open RAN’s ability to deliver a new set of domestic 5G solutions. All said, RAN is only one component among the core and transport elements that are tied to cellular network deployment.

Open RAN has the potential to replace a significant amount of base station hardware with open source, virtualized radio units. This sector’s profit margins are already thin, given the sheer volume of access infrastructure, and Open RAN could significantly impact profitability.

Open RAN also has the potential to open up the segment to a host of new participants, given its leverage of traditional IT enterprise infrastructure. The million-dollar question is whether operators like AT&T, Verizon, and Telefonica that are actively engaged in the newly formed Open RAN Policy Coalition will benefit. There are capital expense savings to be realized. The question is, would an increase in operational expenses negate these savings, given the greater degree of complexity, cost and management of software integration and loss of accountability from the disaggregated nature of Open RAN?

The security ramifications are another potential concern with Open RAN. On one hand, open source has the ability to bring a broader collective together to scrutinize vulnerabilities — more ‘eyeballs’ on a platform to deal with issues. However, the very nature of Open RAN will bring more industry standard compute, storage and networking elements into the mix, thereby increasing the overall threat surface. It is a complex consideration for operators, as the burden falls on them to manage subscriber privacy in a dynamic environment.

With more solution providers vying for a piece of the RAN pie, will that make the addressable market unattractive? Could this dilution negatively affect the overall investment by infrastructure providers in RAN, and, in turn, the support for performance enhancements and higher band, mmWave spectrum coverage? Lastly, how realistic is it that Open RAN will be a substantial element of final 5G deployments?

The bottom line is that the drive to adopt Open RAN and other more modern, software-defined, “virtualizable” network topologies is unquestionably moving forward, but the ultimate pace at which it occurs is going to be dependent on how easily network equipment vendors can make the transition possible for carriers. Given the incentive of speeding up the delivery of new 5G services, like network slicing, as well as improving the overall efficiencies and costs of running those networks, the appeal to move to Open RAN is strong. It’s just a question of practical realities and how motivated the participants are in making it happen.

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