Open RAN 2 - A Paradigm Shift Mandating a New Wireless Ecosystem

Today, wireless service providers are at the starting line of a generational shift in providing agile services and better performance to consumers. Rolling out those capabilities in a timely and cost-effective fashion requires new thinking in architecting the radio access network (RAN). The capital costs of RAN equipment and the need for faster access to new capabilities are creating a path to work in a new way: Open RAN.

Open RAN is an architecture where the centralized baseband components of the RAN connect with remote radio units (RRU) over a standardized open interface. This new architecture provides the operator with deployment flexibility that breaks vendor lock-in and allows the operator to tailor their RAN for the needs of their services. More importantly, Open RAN is creating a new ecosystem founded by wireless service providers that also includes traditional and emerging network equipment suppliers. The ecosystem participants are committed to evolving radio access networks in ways that could change the economics of building and running mobile networks. It will not just save operators money on CAPEX and OPEX but provides the potential to foster innovation in services and encourage new business and operating models.

There are four benefits that the ecosystem will realize:

Business Success: Mobile network operators continue to move their networks to an all IP-based software driven environment, where service and applications can be dynamically introduced to customers. A robust Open RAN ecosystem will be crucial for developing new use cases, such as providing cost-effective private networks, delivering faster access to new features and services, increasing coverage in remote and rural areas, and enabling on-demand capacity in venues. For these new use cases, new business models will emerge that will rely on the collaborative development of the ecosystem.

Broader Product Choices: Traditionally, product innovation in the RAN was led by the vendors. An operator-led open ecosystem where all suppliers deliver compatible products will create the product choice that operators desire. A recent Heavy Reading study showed that operators consider a limited supply of product options as one of the biggest inhibitors to deploying Open RAN¹. It is unlikely operators will purchase Open RAN products if they don’t have enough viable options to consider. A robust ecosystem produces scope and scale of products that encourage deployment of Open RAN, giving service providers more confidence in the viability of Open RAN that speeds up its adoption.

Seamless Operation and Interoperability: Even though the mobile network operator community has undertaken significant initiatives for developing Open RAN systems, it is still in the early days for MNOs to make Open RAN a significant part of their networks. There are multiple challenges and barriers – both real and perceived – that the Open RAN vendor community must address to gain wider operator acceptance and trust. Without openly addressing topics like interoperability verification, system integration, and human skills and competency development, MNOs will not have the confidence in the product to invest their capital. It is clear that an active and open vendor community will need to work together on these challenges, like for interoperability; even in a clearly-defined standard, vendor implementations can interpret the standard differently, resulting in incomplete outcomes. These issues require work and analysis from a framework that fosters partnership and collaborative development between all stakeholders.

5G Economics: The need for a robust and dynamic Open RAN ecosystem will become more crucial with the arrival of 5G. Expectations are that the economics of 5G will encourage operators to consider alternative business models. A recent McKinsey survey of CTOs of top global mobile network operators (25% multi-region operators, 25% European, 20% North American, 20% Asian, 10% in Middle East, Latin America, and Africa) stated that they expect network sharing to increase, especially in areas where having multiple 5G networks may not be viable. Also, most of the CTOs surveyed (approximately 90%) expect third-party neutral hosts to supply network resources that will be shared by multiple operators². This network sharing essentially means that operators will need to collaborate more closely with more than the traditional RAN vendors due to:

1. Those vendors will still be running a large part of the service provider’s network;
2. A host of new RAN vendors including Open RAN vendors will most probably be supplying equipment and service to most of the neutral hosts.

Open RAN success is predicated on the ecosystem partnering together to create an environment where problem-solving and standardization result in products that bring new features and services to market faster and drive new revenue opportunities for operators. This new environment must include both traditional and new Open RAN vendors, as both can learn from each other. As a study from Heavy Reading showed, a large majority of operators would prefer their traditional RAN vendor partners as system integrators even when deploying Open RAN from new vendors³.

Network operators are looking to reduce their costs, and Open RAN helps facilitate lower costs by providing multiple sources of products from which to choose. Enabling a multi-vendor RAN capability and introducing new RAN vendors (and their agility) can help deliver new capabilities faster. But in the end, it’s the end users who determine the success of a network – they chose the network that delivers what they want at a price that they are willing to pay.

Samsung believes that an Open RAN ecosystem that includes network operators, new and traditional RAN vendors and system integrators can make cost-effective and confidence-inspiring solutions possible. As an established pioneer in evolving access network technology, we endorse and actively participate in the drive to create a viable Open RAN ecosystem.