It's still early days, but there have been a few signs that the open RAN trend is creating some real changes in the global wireless industry.
Specifically, two of the world's leading open RAN proponents – Rakuten in Japan and Dish Network in the US – are turning to smaller, lesser known vendors for their 5G efforts.
"Yes, this is happening," said Recon Analytics Analyst Roger Entner
Open RAN "is making progress, which is great," added analyst Earl Lum of EJL Wireless Research.
In perhaps the most compelling data point for open RAN, Rakuten has turned away from two big 4G vendors – Cisco and Nokia – for its 5G network buildout. Instead, the company plans to use equipment and software either from smaller vendors or gear it developed internally.
Similarly, Dish has named a handful of initial vendors for its promised 5G network and, so far, there are no big telecom vendor names to be found. Instead, companies like VMWare, Mavenir and Fujitsu are in the spotlight.
Moreover, there are indications that bigger incumbent network operators are also interested in leveraging open RAN to engage with a more diverse set of suppliers.
"New players can get into the space in a much shorter time frame" via open RAN, said Adam Koeppe, SVP of network planning for Verizon. He said the operator has held discussions with a number of new, unnamed vendors as a result of the open RAN trend.
"It's a very rich ecosystem," agreed Yago Tenorio, group head of network architecture for Vodafone Group, noting the operator is considering an open RAN overhaul across 100,000 cell sites. "It's a lot of work to engage all these people, but it makes the discussion better."
Missing marquee customers
Since first outlining its open RAN plans in 2019 – which include launching a 4G network and, later this year, a 5G network – Rakuten in Japan has taken a leadership role in the space. Rakuten's Tareq Amin is even playing a prominent role in the FCC's upcoming open RAN forum.
As a result, Rakuten vendors ranging from Qualcomm to Viavi have boasted of their relationships with the Japanese operator. Cisco – which supplies Rakuten's 4G virtual packet core, among other products – even developed a sizzle reel highlighting its work.
But Cisco is playing a much smaller role in Rakuten's 5G network. It's supplying the operator's non standalone core, but NEC is supplying the standalone core that is widely viewed as the future of the technology.
"Collaboration with our partners is based on a shared commitment to develop innovative solutions within an open source community, in the interests of offering cost-effective, highly stable, secure and agile services to our customers," Rakuten wrote in response to questions from Light Reading on its relationship with Cisco. "For the delivery of 5G services, we are partnering with organizations such as NEC and Altiostar that are closely aligned to our overall objective of driving a highly collaborative open source community."
A representative from Cisco argued that the company is "still very much part of the Rakuten service," and that Cisco counts more than 100 engineers supporting Rakuten in a variety of areas.
Nonetheless, Rakuten's Amin has publicly touted "moving from Cisco" to develop the company's own orchestrator, operations and business support systems, and cloud infrastructure management.
"It's a harbinger of things to come," Recon Analytics' Entner said.
He explained that operators, in an open RAN scenario, can select several different vendors and operate them in different regions, for example, in order to see which ones perform the best. "That is the huge difference" compared with the mostly vertically integrated offerings from the market's bigger suppliers.
Entner likened the situation to "speedboats" versus "supertankers," with speedy open RAN suppliers being much more willing to meet operators' demands.
Big suppliers like Ericsson and Nokia "are less willing to do whatever the operator wants," agreed Lum of EJL Wireless Research.
Plenty of obstacles
However, both Entner and Lum agreed that it's still early days in the open RAN trend, and there's no telling how the space will play out in the long term.
"The exit strategy of these small [open RAN] companies is to be bought by the big companies," Entner explained, noting that companies like Cisco and Intel "are very acquisitive."
If the open RAN trend catches fire, he said the market's bigger companies may simply buy their way back into operators' business by acquiring successful open RAN startups.
And Lum said that the open RAN space still carries plenty of risk. He pointed to Vodafone's recent open RAN announcement with vendor Mavenir for 4G, which covers a relatively tiny, rural area. These kinds of timid open RAN steps help operators avoid costly network hiccups.
And Lum pointed to another open RAN obstacle for operators: "You need a good integrator," he said, explaining that Ericsson, Huawei and other big vendors typically hand operators a full network package, whereas operators themselves will have to figure out how to assemble the pieces of an open RAN design.
"It's got a long road ahead of it," Lum said of open RAN.
Indeed, the Wall Street analysts at both New Street Research and MoffettNathanson have remained unimpressed with Rakuten's overall effect on the Japanese wireless market. "Rakuten's virtualized ORAN [open RAN] network has underwhelmed," the MoffettNathanson analysts wrote in a July note to investors. "Their cost structure is much higher than expected – mostly for non-network reasons – and their pricing is therefore necessarily higher. Their early market share, and therefore disruptiveness, has been much lower than expected."