Open RAN on track to comprise 15% of radio access networks by 2026

Research from telecommunications analyst Dell’Oro Group has painted a rosy picture for the development of the open radio access network (Open RAN/O-RAN) ecosystem.

It found that revenues from O-RAN technology and Open RAN radio and baseband surprised with growth in 2020 and 2021, bolstering the thesis that Open RAN is here to stay and the architecture will play an important role before 6G.

For leading telcos, especially those in Europe, the best opportunity to defend and grow their place in the global 5G and 6G industry appears to be in building a broad and deep Open RAN ecosystem.

The technology’s proponents argue that open, intelligent, virtualised and fully interoperable RAN, delivering and enabling more effective and efficient mobile communications, is essential if regions are to meet aggressive 5G targets. They believe such action will help to drive stronger, more resilient supply chains and platforms, and promote digital autonomy and continued technology leadership.

The Dell’Oro Group Open RAN advanced research report calculated that Open RAN revenues are expected to account for around 15% of the overall 2G-5G RAN market by 2026, reflecting healthy traction in multiple regions with both basic and advanced radios. The analyst expects the Asia-Pacific region to dominate the Open RAN market in this initial phase and to play a leading role throughout the forecast period, accounting for more than 40% of total 2021-2026 revenues.

However, the Dell’Oro Group warned of risks around the Open RAN projections. Even though the analyst said these risks remained broadly balanced, it noted that risks to the downside had increased slightly since its previous forecast update.

The company also observed that the shift towards virtualised RAN (vRAN) – which can support the diversifying network performance requirements in the 5G era – is progressing at a slightly slower pace than Open RAN. That said, the analysis showed total vRAN projections remain mostly unchanged, with vRAN on track to account for 5-10% of the RAN market by 2026.

“The Open RAN movement has come a long way in just a few years, surprising both proponents and skeptics,” commented Stefan Pongratz, vice-president and analyst with the Dell’Oro Group. “While challenging comparisons will weigh a bit on the market over the short term, it is unlikely that these divergences between the greenfields and the brownfields will leave lasting imprints on the long-term prospects.”

These prospects, according to a study from network software provider Mavenir, are contingent on a certain number of operator requirements. To find out where mobile network operators (MNOs) are on their journeys, Mavenir commissioned a survey with the GSMA’s Mobile World Live, reaching executives from 156 global network operators. It enabled operators to share their views on virtualisation, public and private cloud strategies, multi-generation networks, Open RAN and network automation.

Overall, the Mavenir survey found almost total acceptance of the need to virtualise mobile networks, embrace the use of public or private cloud services and adopt software-led open network architecture. It also showed an overwhelming number of operators were well advanced on the path to network virtualisation.

Specifically, the study revealed that 95% of MNOs understand the importance of virtualisation and have it on their roadmaps, with 98% of MNOs considering open architectures or the opening up of network architectures.

Three-quarters of the executives surveyed characterised opening network architectures as an “essential process” or “critical step”, and more than half ranked increased security through visibility into network functions as one of the top reasons to adopt Open RAN. Just over three-quarters (78%) of MNOs are moving towards the cloud and only 22% expressed caution or uncertainty, while 74% defined having an “agile, multi-generation network” as “critical to progress”.

In terms of timelines, 94% said they had  plans to deploy Open RAN within the next five years.