Mobile network operators (MNOs) must plan and deploy new 5G mobile technology infrastructure in order to meet growing customer demands for higher network quality of experience, but also ensure that their networks are fit for purpose to address other revenue generating use cases, such as those from industries. As well as supporting these diversified business requirements, MNOs also need to work with vendor partners to deploy their next generation networks in a speedy manner to deliver on their go-to market KPIs, such that they remain competitive.
One of the challenges in achieving these goals is that MNOs' radio sites are already crowded with existing non-5G hardware.
Huawei held its Mobile Broadband Forum (MBBF) 2020 as an online event in November 2020. During this event, it announced its 5G product portfolio of solutions, geared towards building ultra-simplified “1+N” 5G networks.
MNOs increasingly face challenging business scenarios, yet they must proceed with 5G rollouts to meet customer expectations
MNOs understand that the perception of network performance plays a major role in the overall customer satisfaction and it is one of the main levers against customer churn and long-term business success. Despite flat or declining ARPU in many markets over the last 5 years, MNOs must continuously upgrade their existing 4G networks and deploy 5G networks to remain competitive.
This is a two prong challenge to MNOs' finances given the limited consumer willingness to pay higher prices for a faster connection. In order to achieve ARPU uplift, MNOs have attempted to bundle value-added services, such as streaming music and video to their mobile contract propositions, but most of those have met with limited success. Fortunately, 5G will deliver new monetisable features and network capabilities, such as the ability to connect a large number of devices per square kilometre, ultra-low latency communications for a much faster network response and significantly higher network reliability, compared to the previous generations.
These capabilities will enable the MNOs to improve their services' portfolios, targeting consumers and enterprises with use cases, such as high quality augmented reality/virtual reality (AR/VR) gaming and ultra-low latency driven robotic arms used in smart factories, respectively.
MNOs must build their next generation networks to deliver on the promise of these use cases and derive new revenues, but they must plan these rollouts in a cost-effective manner. Analysys Mason conducted a survey of 60 mobile operators, including Tier-1 and 2 MNOs and found that over half the respondent's placed total cost of ownership (TCO) reduction amongst their top-two objectives for next-generation network deployments, Figure 1. Other important drivers were supporting new revenue-generating services from both consumer and enterprise segments.
Figure 1: MNOs' most important high-level commercial goals for 5G networks [Source: Analysys Mason, 2019] Site architecture complexity is already challenging yet 5G will require additional hardware.
The three MNOs in South Korea were amongst the first that launched 5G services in Q2 2019. Over 140 MNOs in 59 countries launched 5G services since these first launches. We forecast 5G coverage will reach 2.8 billion consumers globally by 2025, with regions such as Developed Asia-Pacific (DVAP), Middle East and North Africa (MENA) and Western Europe (WE) reaching 194million, 126million and 262million, respectively. This indicates that MNOs require fast rollout processes in place.
There are many challenges to the aim of TCO efficiency. The introduction of 5G services will mean MNOs must carry additional mobile data traffic on their networks. We forecast annual cellular data traffic will reach 2490 exabytes by 2025, of which 5G handset data traffic will be 1000 exabytes. The 5G handset traffic in Saudi Arabia, South Korea and Spain will reach 12.6 exabytes, 25.5 exabytes and 5.8 exabytes, respectively.
Increasing network traffic will require additional spectrum bands, such as 5G's 3.5GHz and 28GHz millimetre bands. These in turn will require the installation of new radio units (RUs) hardware and antenna elements at the radio access network (RAN) sites. Most RAN sites in the aforementioned regions, however, already contain the hardware to deliver other radio access technologies (RATs), such as 4G (as well 3G and 2G) networks. This means that with limited space availability at these sites, the architecture is already quite complex. There is limited space both at the foot of the towers where much of the electronic equipment, such as air conditioning units, batteries and power supplies are stored as well as at the top of the towers, where the radios and antennas are installed.
A further challenge to MNOs' business case is growing OPEX costs, which if unchecked, would put operators' margins at risk, especially as 5G will require additional network equipment at the sites to serve the new spectrum bands. Furthermore, regulatory requirements in many markets will force MNOs to deploy new legacy RAT sites in areas where coverage is poor.
To meet their deployment goals, MNOs will require not only efficient site design and automation, but also a significant amount of simplification of the existing site architecture.
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This content is sponsored by Huawei.