The wireless communications service industry has only four major equipment suppliers, of which Huawei in China and Ericsson in Sweden are the largest ones. None offer interchangeable products.
This is not a happy situation for customers who are locked in by their chosen equipment provider. It is to be expected that the industry would seek an open market with interchangeable products.
To that end, the Open Radio Access Network Policy Coalition has been established by a large group of US and international companies with the intent to “accelerate open standards for RAN and promote a network ecosystem based on more diverse, secure, compatible and competitive elements.”
This requires massive new software development. The result of such a successful endeavor would be that new open-sourced software would enable “industry standard” hardware from many suppliers to be assembled to build competitive networks, including state-of-the-art 5G networks.
The idea obviously is to replace the proprietary networks now being offered with cheaper and possibly superior solutions from many vendors.
A year ago we discussed this program and suggested that the path to building such a new competitive situation faces many difficult obstacles.
It is time to examine what progress has been made in the past year. A useful review is provided in the November 2021 report by CCS Insight: Open RAN-The Long Journey from Supporting Act to Lead Role.
There has been a substantial amount of activity in the attempt to open the market, but a large-scale displacement of the current industry leaders in large carriers is still years away.
Here are some highlights from the CCS Insight report:
- Companies are actively developing software that aims to reduce the need for proprietary network operating computers by shifting to cloud computing services. Network virtualization is growing rapidly.
- At least one big equipment supplier, Samsung, has declared an intent to leverage O-RAN for an entry into the mainstream telco equipment industry, in which they had not participated before.
- Among the established equipment companies, Nokia has indicated its interest in participating as an O-RAN supplier and Ericsson has indicated an interest in offering more “open” software products that would rely on cloud computing services rather than proprietary computers.
- Of the major carriers, Vodafone is among the most high profile O-RAN supporter and has stated a plan to implement a local solution in the UK by 2027. Other large EU carriers have signed memoranda of understanding to collaborate, but no actual plans are known. A few smaller operators may provide at least partial implementations earlier.
As was evident from the start, global carriers have every interest in increasing competition in the equipment market. But Huawei is on the sidelines, convinced that their proprietary, integrated networks will continue to be the most competitive for their customers. Here are the factors that determine whether they will be right.
- The cost of implementing networks with elements from diverse customers and relying on open-sourced software as the glue may be more costly and troublesome than installing an integrated product suite from one proven vendor.
- Maintaining and upgrading such a O-RAN heterogeneous network will require costly internal carrier resources, and hence may be costlier to maintain than current equipment.
- The idea that such heterogeneous networks are more secure is an unproven assumption that has been challenged by a recent study in Germany.
Summarizing the current status, a great deal of interest continues and small-scale implementations will emerge, but for big networks (the bulk of the equipment market), we are still some years away from seeing if the approach will significantly displace current vendors.