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Revenue implications for deploying 5G-only OpenRAN

by Blogs & Opinions
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Greenfield and brownfield networks
There has been significant buzz about innovation in OpenRAN for 5G, but the 4G and 5G-only OpenRAN approach is only suited for greenfield deployments.

There are only two prominent greenfield networks in the world: Rakuten and Dish. The rest of the world has legacy 2G, 3G and even 4G and these legacy deployments are not OpenRAN. The new greenfield deployments are going for the OpenRAN-powered network deployment approach for obvious reasons.

The OpenRAN solution is well suited for greenfield 4G or 5G deployments as it leads to faster deployment and operators can future-proof their investment. The software-enabled network simplifies expansions and makes it easy for operators with greenfield networks to scale their new networks. The new network is software upgradeable and does away with the cost and complexity of transitioning the networks to 5G.

Mobile operators with the legacy 2G, 3G and 4G deployments need to look at the overall network total cost of ownership (TCO) across their legacy and 5G deployments and use 5G as an opportunity to improve their TCO. Here's a look at what happens to a mobile operator's TCO if they deploy OpenRAN for 5G only alongside their 2G, 3G and even 4G legacy network without considering OpenRAN for legacy or as we say for all G:

TCO impact on deploying 5G-only OpenRAN
If a mobile operator only deploys OpenRAN for 5G, they will have the challenge of managing two networks: a vertical one with legacy equipment and the new one with distributed, OpenRAN architecture.

While the operator might have flexibility and will avoid vendor lock-in for 5G, the legacy network will still rely on closed RAN components. This approach doesn't achieve OpenRAN's goal of avoiding vendor lock-in and reducing cost. OpenRAN needs to replace legacy G's as well. This way, all the RAN network components for all of the G's will be open and virtualized. Leading global operators using OpenRAN to modernize their legacy networks estimate their return on the modernization investment will occur in three years and will help them deploy 5G cost-effectively.

Operators that only deploy OpenRAN for 5G without rethinking their overall network strategy, including legacy G's, might see short-term capex savings in deployment of OpenRAN for 4G and 5G compared to the equipment from legacy 4G and 5G vendors, and their overall opex will be 30 percent to 50 percent higher since older G's are not as power-efficient or easy to maintain. Long-term gain can be only achieved if all G's become OpenRAN while mobile networks move to 5G.

The service providers adopt a siloed approach of adding a new layer for every new G. Typically, legacy RAN platforms are based on proprietary hardware and depend on prolonged and costly lifecycles in development, deployment, and operation.

The siloed approach of adding a new layer for every new technology leads to network complexity and requires high investment in capex and opex to maintain. This leads to vendor lock-in and sometimes prevents the mobile operators from keeping pace with the new technology developments. With the launch of the new generation, the radios are replaced with newer versions with substantial investment.

5G offers service providers an opportunity to reimagine the overall network architecture and deploy cost-effective open networks not just for 5G, but for legacy as well.

Support of all G OpenRAN across the globe
The telecom infrastructures are already undergoing a rapid transformation towards applications running on Network Functions Virtualization (NFV) or containers. This transformation is extending further to the RAN to separate functions, where every vendor offering can interoperate with other products. This allows the operators to explore new business models that promote openness and is built on open principles, which provides operators with benefits from cloud-scale economies and service agility.

Several global service providers are already opting for OpenRAN architecture across all G's to break from the limitations imposed on them by proprietary radio systems. The OpenRAN network architecture that addresses 2G, 3G, 4G and 5G which is programmable, flexible and unbundled can meet the requirements for improved mobile broadband and extremely low latency for legacy and newer G's.

The new OpenRAN across all G approach means mobile operators can run just one OpenRAN network. The most significant advantage of the all G OpenRAN is that service providers can improve network economics by converging all Gs on one single software platform. It not only helps in enhancing network simplicity but brings down the cost of managing and maintaining the network. This will allow the unification of legacy brownfield with greenfield so it can be managed as one cloud-native all IP network.

5G as an opportunity to rethink Legacy G's
5G is a technology change that no service provider in any part of the world wants to miss out on. Even if there are challenges in rolling out 5G services, as there are commercial as well as infrastructural issues related to the mass launch of 5G services, there is no denying that the technology would give a massive boost to the world's economy.

5G provides operators with the ability to deliver myriad innovative services like augmented reality, virtual reality, remote surgery, autonomous transport systems, industrial automation and more. These 5G functionalities could help deliver services like healthcare and education on a mass scale by side-stepping infrastructural challenges. 5G enables the mobile network to support services including e-learning and ehealth, through digital platforms, which is more cost effective and sustainable, but only if legacy G's are addressed as a part of the overall network strategy.

5G is just another tool in the OpenRAN box, but unless all G's become OpenRAN, the true promise of OpenRAN and 5G cannot be realized.

— Steve Papa, CEO, Parallel Wireless

Photo by William Iven on Unsplash

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