Experts See Gradual Evolution from Traditional to Open Networks

Carriers are upgrading networks to virtual and open radio access networks, reflecting a gradual evolution, speakers said Thursday during an Informa Tech webinar. But Dell’Oro Group warned that North American investments in the RAN remain on a downward trend, with no uptick in sight.

“At Vodafone, we currently have a fully distributed approach,” which means that the central unit (CU) and the distributed unit (DU) of the RAN are deployed on top of a server, said Ernesto Salazar, senior ORAN product engineer at the U.K.-based operator. Vodafone is still exploring other options and analyzing other network architectures, he said.

Salazar said the RAN has seen a gradual evolution in recent years. That started with the traditional RAN, “based on a monolithic architecture where the software application and the operating system are strictly" tied to "a piece of hardware,” he said. This approach has not been flexible or “cost-friendly” enough and “a big change was required,” he said. The virtualization era offered “a bit more flexibility than traditional architecture,” Salazar said. But virtualized RANs didn’t offer “the agility, the stability and the efficiency” that carriers were seeking, he said. “Another change needed to happen in order to improve and meet market expectations,” he said. That led to the move to a cloud-native approach to the RAN, he said. “Here the virtualization layer is managed in a much, much better way,” he said.

The reason carriers are moving to ORAN is to potentially reduce costs and “increase the pace of innovation,” said James Kimery, vice president-product management at Spirent Communications, a telecom testing company. Cloud-based networks offer elasticity, containerization and deliver "network functions as microservices with orchestration” and greater “observability” of the network, and, potentially, a more optimized network, he said.

The key to greater visibility is generating data and being able to use AI and machine-learning algorithms to analyze the data, Kimery said. As carriers looked to virtualize the network DU and CU “there were a lot of questions that had to be answered,” he said: “It’s clear that the 5G core is much more complex than 4G,” he said.

Carriers need to improve network testing and “test coverage is a big question,” Kimery said. The RAN intelligent controller (RIC), which is part of ORAN, can optimize the network and make it more energy efficient but also make it able “to self-heal and correct for problems, diagnose problems instantaneously,” he said: “That ability to react is one of the goals that we want to get to.”

“Cloud-native RAN is many things,” said Gabriel Brown, senior principal analyst-mobile networks and 5G at Heavy Reading. The movement is toward centralized operations, starting with the CU, with fewer companies looking at the CU and DU, he said. “When we say centralized we really mean at an edge aggregation site a few kilometers from the antenna site,” he said.

“We’re going to see more and more performance demands placed on any cloud RAN technology stack as we go forward -- a lot more in my opinion,” Brown said. For carriers, it’s important to anticipate future requirements of the RAN, he said.

North American investments in the RAN continue their decline, and the “RAN dive in North America is not over,” Dell’Oro Group said. Following a “remarkable” 40%-50% increase between 2017 and 2021, global RAN revenues witnessed a second consecutive quarter of steep declines in 3Q, "primarily driven by reduced RAN investments in North America,” Dell’Oro said.

Stefan Pongratz, vice president-RAN market research, said declines here have been offset in other regions. “Helping to explain the more upbeat sentiment outside North America is the 5G ramp in India, taken together with positive trends in the Middle East and Africa region,” he said. Mobile broadband investments “remain fairly elevated relative to pre-5G levels in most of the advanced 5G markets even in the post-peak period, with the exception of North America,” he said.

Top RAN suppliers in the quarter included Huawei, Ericsson, Nokia, ZTE and Samsung. Ericsson and Nokia “are gaining revenue share outside of North America,” Dell’Oro found: “Worldwide RAN revenues excluding North America recorded a third consecutive quarter of growth,” but the market, “having peaked in 2021, is on track to decline in 2023 and 2024. While the pace of the decline is expected to moderate in 2024, conditions will remain challenging as the pendulum swings towards the negative in India.”