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November 13, 2019
AMSTERDAM -- TIP Summit -- Sign up to a 4G service today and it's a safe bet that your service provider's mobile network was built by one of three equipment leviathans: China's Huawei, Sweden's Ericsson or Finland's Nokia. Together, those companies account for almost 80% of the market for radio access networks (RANs), according to Nick Read, the CEO of telco giant Vodafone. The only serious alternatives have been Samsung, a South Korean vendor, and ZTE, a relatively small Chinese one.
But for a couple of hundred thousand Peruvians, a much smaller US supplier called Parallel Wireless is the key player. Its products power a commercial 4G network built by Internet para Todos, a wholesale operator owned by Spain's Telefónica, Facebook and two Latin American banks -- IDB Invest and CAF.
It's one of the world's very first commercial deployments of OpenRAN, a new approach conceived as a low-cost alternative to the leviathans, and it's potentially a big deal. OpenRAN is the brainchild of the Facebook-led Telecom Infra Project (TIP), an expanding association of operators and technology companies whose professed mission is to kickstart competition in what they perceive to be a tightly controlled market. If all goes to plan, TIP-sanctioned technologies could eventually form the entirety of an operator's network, says Axel Clauberg, the chairman of the TIP group and a senior technology executive at Germany's Deutsche Telekom.
What makes OpenRAN so different from the status quo? In a traditional network, the RAN products at a given site tend to come from the same big vendor. There is usually no other option, say TIP advocates, because interoperability between different suppliers remains poor. Prying apart the hardware and software is difficult, too. OpenRAN is supposed to provide an answer with more general-purpose, interoperable gear -- so-called "white boxes."
Internet para Todos now operates around 650 mobile sites covering about 800,000 people. And while half were built by a traditional vendor, understood to be Huawei, the rest are billed as OpenRAN sites featuring Parallel Wireless products. The savings claims are bold. David del Val Latorre, Telefónica's CEO of research and development, says the cost of electronic gear was half as much at the OpenRAN sites as it was at the traditional ones. That has been critical in allowing Internet para Todos to serve communities where incomes are low. Already, it boasts 450,000 subscribers, having only launched in May.
Yet doubts persist about the openness of the technology. "They are getting there," says del Val Lattore when asked if Parallel Wireless is using open white box technology and supporting full interoperability. It was picked in preference to OpenRAN alternatives such as Altiostar and Mavenir because it was the first to be ready, he says, and is highly regarded by analysts. Since work began, however, Telefónica has made an undisclosed investment in Altiostar, making that company a more obvious choice for OpenRAN deployments in future.
A related issue is the coordination between OpenRAN efforts and the work of the O-RAN Alliance. That group, which includes many of the world's Tier 1 operators, is trying to fix the interoperability issue with open alternatives to the interfaces commonly found in today's networks. CPRI, which handles links between radios and "baseband" gear used to process signals, is one of the most maligned. X2, which would sit between 4G and 5G baseband systems, is another. Ideally, TIP's activities would inform the O-RAN Alliance and its products would use O-RAN specifications. But that is not yet happening rigorously, and there is still no formal agreement between the two associations.
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OpenRAN also faces cost and deployment hurdles. For one thing, the cost of electronics is only a fraction of what operators spend on total capital expenditure. "When you take everything together, the difference is not as great," concedes del Val Latorre. Dislodging the leviathans will be difficult now that many operators are already investing in 5G New Radio (NR) products. "There are millions of 5G NR-ready radios in the field that can be upgraded with minimal hardware or in some cases remotely, complicating the business case for new entrants," said Stefan Pongratz, an analyst with Dell'Oro, in a recently issued research note. That could restrict OpenRAN to "greenfield" scenarios and emerging markets, where 4G and 5G are still at the planning stage.
Perhaps the biggest concern is about the operational complexity that an OpenRAN network could bring. In traditional networks, operators have relied heavily on what del Val Latorre calls "monolithic" operational support systems (OSS) and management tools. These would not suit a more disaggregated RAN, he says, and Telefónica's overarching strategy is to use multiple suppliers and not be overly reliant on a single vendor. Managing this set-up looks tricky.
In Peru, Telefónica has relied on a combination of in-house resources and a Spanish systems integrator called Everis, which has a major presence in Latin America. The question is whether all this entails an increase in operational expenditure, especially if problems arise. "That is not the plan," says del Val Latorre. "It will not go up." As a first step in that plan, he is in meetings at this week's TIP Summit in Amsterdam about ways to improve the OSS that service providers use.
The various challenges have not stopped Internet para Todos from pressing ahead, and a commercial network serving nearly half a million customers is a significant achievement. In Facebook, that operator clearly has a muscular supporter with the financial resources to make OpenRAN work. The industry is watching to see how much further it can go.
— Iain Morris, International Editor, Light Reading
International Editor, Light Reading
Iain Morris joined Light Reading as News Editor at the start of 2015 -- and we mean, right at the start. His friends and family were still singing Auld Lang Syne as Iain started sourcing New Year's Eve UK mobile network congestion statistics. Prior to boosting Light Reading's UK-based editorial team numbers (he is based in London, south of the river), Iain was a successful freelance writer and editor who had been covering the telecoms sector for the past 15 years. His work has appeared in publications including The Economist (classy!) and The Observer, besides a variety of trade and business journals. He was previously the lead telecoms analyst for the Economist Intelligence Unit, and before that worked as a features editor at Telecommunications magazine. Iain started out in telecoms as an editor at consulting and market-research company Analysys (now Analysys Mason).
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