Cloud RANs offer promise in APAC, but not in near future
While there is growing interest in cloud-based radio access networks, experts argue that telcos will still cautiously approach the technology in a phased manner
The telecommunications industry has long developed its products based on proprietary technologies that only marginally overlap with the IT world.
But a confluence of technological and economic factors is forcing both industries to find common ground and a convergence between the two is inevitably taking place, according to several industry experts.
These factors include the need to gain cost efficiencies from infrastructure roll-outs, new technologies that depend more on a cloud-based world, the need for open standards to drive scale and interoperability, and high-speed bandwidth requirements of 5G networks.
According to Patrick Waldermar, vice-president of Telenor Research, most radio access networks (RANs) are traditionally supplied by a single supplier with mostly proprietary hardware and software.
This setup has been successful and maintained because there has been little impetus from the industry to change, he argues.
“RAN vendors are traditionally the systems integrators themselves,” he says. “But we believe RANs will become more open and will move into the cloud, similar to what has happened in the mobile core,” says Waldermar.
Gareth Owen, associate research director at Counterpoint Research, notes that historically, older GSM (2G) base stations had an all-in-one configuration which hosted all electronics and connected to antennae via radio frequency (RF) cables.
Owen says the industry eventually introduced distributed RANs (D-RANs) in 3G systems, where the radio elements on the antennae systems known as the remote radio head (RRH) are decoupled from the baseband unit (BBU) – where signal processing takes place – and colocated at the base of the tower. The two are interconnected via fibre links.
The BBU is further connected to an aggregation device where traffic is added with other services and sent along to the mobile switching centre (MSC), he adds.
“Installing the RRH at the top of the tower close to the antenna reduces RF loss compared with earlier 2G systems,” he says. “The fibre link between the RRH and the BBU also allows more flexibility in network planning as the BBUs can be located a few hundred meters to several kilometres from the tower.”
The next evolution to D-RANs was proposed by China Mobile in 2009, Owen notes. Known as the centralised RAN, the concept did away with individual BBUs located at individual cell sites but aggregated them at a central location known as the “BBU hotel”.
The analyst says centralising the BBUs this way increases economies of scale in equipment as the BBUs share common power, cooling and routing facilities in a BBU hotel.
“It also reduces operational expenditure [opex], lowers maintenance costs, improves spectral efficiencies, and enables cell site bandwidth aggregation, which can result in performance improvements of up to 30%,” says Owen.
Besides considerable opex savings and faster time-to-market, Owen says centralised RANs position the BBU for network function virtualisation (NFV) and the RAN for software-defined networking (SDN), a concept that is becoming mainstream in the IT industry.
“The ultimate goal for vendors is the virtualisation, the disaggregation of the user and control planes, which is an essential step towards an open wireless network infrastructure and a much more open and flexible RAN,” he adds.
Aside from hardware cost savings and efficiency boosts, virtualised centralised RANs – also known as cloud RANs – are able to pool together the management of radio resources, notes Jake Saunders, vice-president for mobile infrastructure at ABI Research.
“Once all the elements are virtualised, they can be deployed on proprietary commercial off-the-shelf (COTS) servers, and hosted on the cloud,” he says. “COTS servers can reduce the RAN equipment cost, support dynamic radio resource allocation, and accelerate network deployment and upgrade processes.
“Operators can also create open networks, support multi-vendor and interoperable network architectures, as well as accelerate time to innovation and lower capital expenditure [capex].”
Not quite there yet
As seemingly advantageous as cloud RANs are, the industry players Computer Weekly spoke to agree that the technology is not yet mainstream and operators are still a way off implementing them.
Indeed, major operators in Southeast Asia, namely Singtel and StarHub, as well as Malaysia’s Telenor-owned Digi Telecommunications, declined to comment when asked by Computer Weekly about their cloud RAN plans.
Meanwhile, Singapore’s nascent operator, TPG Telecom, and Thailand’s second-largest player by subscriber base, TrueMove H, also did not respond to queries for comments.
For Nitin Bansal, head of networks at Ericsson for India, Oceania and Southeast Asia, the evolution to cloud RAN is a multi-year journey and requires several changes.
To realise operations and maintenance benefits, Bansal says operators need to evaluate their key use cases and deployment scenarios to decide on the right cloud infrastructure and what approach to take to system integration and automation.
ABI Research’s Saunders adds that most operators cannot turn on a dime and have occasionally been burnt by telco infrastructure fads in the past.
He notes that despite all the so-called benefits of cloud RANs, many operators’ C-level suites have to confirm objectives, conclude technical or performance trials, and allocate funding out of their companies’ existing budgets for investment and upgrade.
“The C-levels need to consider the return on investment [ROI] of existing equipment versus the potential ROI of swapping out equipment,” says Saunders.
Hurdles to cross
Meanwhile, Counterpoint’s Owen argues that for some operators, the main impetus of adopting cloud RANs is because of their foray into 5G networks, as they will need to offer new types of services to address the enterprise market, particularly those in the industrial sectors, where performance and reliability is key.
“Cloud RANs enable network agility and automation, which is essential for introducing new services such as network slicing,” he says. The true potential of 5G cannot be realised without using cloud RANs.”
“Cloud RANs enable network agility and automation, which is essential for introducing new services such as network slicing. The true potential of 5G cannot be realised without using cloud RANs”
Gareth Owen, Counterpoint Research
That said, on a more technical level, Owen says the two main impediments against widespread cloud RAN deployment now is the availability of cheap fibre, particularly dark fibre, and access to real estate.
“It’s fine for countries such as Japan, South Korea, parts of China, and major metro areas in the US, but not in many other parts of the world, including Europe, where dark fibre availability is lacking. This is why Rakuten is on cloud RAN in Japan, but Dish Network in the US will need a more flexible architecture,” says Owen.
“Operators also need access to real estate to locate their datacentres. For large legacy operators such as BT, AT&T, Deutsche Telekom and Orange, this isn’t an issue as they have plenty of their old central switching offices, but for new operators, this would be a challenge.”
Owen also cautions that any savings in infrastructure costs due to cloud RANs may be wiped out by fibre deployment and real estate costs.
“The decision to adopt cloud RAN (or not) should depend on factors such as how distributed the network is and how many edge datacentres should be built,” he adds.
Roadmap for cloud RANs
According to ABI Research’s Saunders, there are some cloud RAN initiatives being rolled out by Vodafone, Telefonica, Turkcell and Deutsche Telekom.
But by far the most prominent roll-out is Japan’s fourth largest player, Rakuten Mobile, which started deploying the world’s first end-to-end, cloud-native commercialised public network in April 2019, he notes.
“In collaboration with a few partners, Rakuten Mobile aims to reduce capex by up to 30% and opex by 40%, in comparison to traditional RAN systems,” he says.
Counterpoint’s Owen argues that although Rakuten Mobile uses a lot of ground-breaking technologies, it is struggling to gain subscribers and to roll out both the 4G and 5G networks.
“I don’t think the focus is really on leveraging the distributed nature of its cloud RAN and the network yet,” he says.
“The mass commercialisation of cloud RAN is arguably a long-term initiative, but with the expansion of the ecosystem and more deployment success cases, an inflexion point will be reachable in the near future”
Jake Saunders, ABI Research
Owen also notes that Rakuten Mobile’s network is greenfield and is much easier to deploy as there aren’t any legacy issues to deal with, such as how to integrate with older mobile networks.
“Established operators are now preoccupied with rolling out traditional 5G. With the exception of the very biggest ones, the migration to cloud RAN will happen in tandem with the availability of cloud RAN products in one to three years,” he says.
“We believe most operators will just follow the migration path options offered by their RAN vendor to ensure compatibility and integration with existing networks.”
Ericsson’s Bansal argues that there is still strong ROI for operators for protecting and maximising the utilisation of existing assets while providing them an opt-in approach towards cloud RAN technology.
“We believe purpose-built solutions will continue to play a pivotal role in operators’ networks for quite some time,” he says.
“This is a journey that will take time and, to enable operators for this change, we are offering cloud RAN solutions in stages, matching their journey and to complement their next-generation networks.”
ABI Research’s Saunders argues that while cloud RAN will take time to arrive and that standardisation is important, operators should not necessarily wait for full maturity as there are steps they can take to prepare for it.
Noting that network operators should provide proper training for employees to improve network operations and integration skills, Saunders says there are always concerns about the operation and integration complexity of a multi-supplier network.
They need to start planning for the cloud RAN footprint in small and easily manageable scenarios, he adds.
“The mass commercialisation of cloud RAN is arguably a long-term initiative, but with the expansion of the ecosystem and more deployment success cases, an inflexion point will be reachable in the near future,” says Saunders.
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