Nokia: The Open RAN business case isn’t yet established for new or existing networks
If you look at scaled Open RAN deployments today, it will become immediately obvious that the largest builds are from greenfield operators–1&1 in Germany, Dish in the United States and Rakuten Mobile in Japan. It’s undeniable that implementing new technologies is easier when you’re starting with a blank state. But if you look forward at planned Open RAN deployments, operators with expansive existing networks, the likes of Orange, Telefonica and Vodafone, for instance, plan to introduce disaggregated radio systems into their existing networks. So how will this dynamic play out?
It depends, according to Adrian Hazon, vice president of global product sales at Nokia. In terms of whether these greenfield builds provide a model for other future greenfield builds, “I think it depends if those networks…can successfully demonstrate that O-RAN can really deliver the cost savings and the equivalent performance that’s expected. That’s the key challenge to this and it’s not close to being proven yet. It’s also, I think, fair to suggest that there aren’t huge amounts of large-scale greenfield networks waiting out there to be built, and that does rather limit the market possibilities out there.”
Acknowledging that supplier diversification is a stated goal of Open RAN, “More competition doesn’t necessarily lower the cost or improve the performance,” Hazon continued, calling out that Nokia itself is currently comprised of numerous acquisitions of other radio suppliers. “From a Nokia point of view, we welcome the competition, we welcome the innovation that it drives.”
To that point around innovation, Hazon noted that Open RAN is much more than open fronthaul interfaces, although it certainly includes that. “It’s also the near-real-time RAN Intelligent Controller…that offers up capabilities through which the network operators can differentiate and improve cost-efficiency, network performance…I would say some [operators] may follow this approach if the integration complexity and cost can be dealt with. So, yeah, interesting times.”
Can Open RAN live up to the plug-and-play “hype”?
Hazon said that his conversations with brownfield operators on Open RAN are a balance of needing to keep an eye on emerging technology trends that could add shareholder value while facing the reality of tremendous capex and opex pressure. New innovations are necessary “to generate more revenue essentially. And that’s the appealing backdrop of it, and that’s what they’re trying to understand…If O-RAN does start to deliver on the hype–I use hype because 5G was hyped and now O-RAN is hyped again–you’ve got to get to the nitty gritty of what it actually delivers. I think if by keeping a close eye on O-RAN, both fronthaul and RIC, and making sure it’s well understood, then the brownfield operators can move quickly if they need to.”
He also addressed the desirable idea of mixing and matching hardware and software from different vendors in a plug-and-play manner which in theory gives operators a huge amount of flexibility and optionality. “That can help address potentially some of the supply issues and some of the different spectrum scenarios. But, of course, the concern there is that we’re some way off from having open fronthaul plug-and-play. Getting basic functionality working between someone else’s RF and baseband, that can be done and it has been proven by some of our customers…We’ve done it as well with third parties, but it’s taking that basic plug-and-play and getting that working to the full standards that you need to do with the full capability. So getting equivalent performance to a single-vendor solution remains quite challenging, particularly if you’re looking at massive MIMO and these complex radio scenarios.”
The three Ps of Open RAN
If it’s current brownfield operators looking to incorporate Open RAN or for future greenfield operators evaluating use of the architecture, Hazon said they’d look at three Ps: price, power and performance. “It has to hit the same price point as a classical sort of deployment. It’s got to be at least as efficient as the…specialist solutions that are out there from vendors like ourselves. And it’s got to have the same level of performance. SO until we hit those three Ps, then it’s going to be a challenge.”
But what does that mean for Nokia which is active in Open RAN but obviously inclined to sell its fully-integrated solutions as opposed to selling parts of a multi-vendor solution? “We’re open about this discussion,” he said. “We have to be open with our customers…You have to start by explaining what we see as the complexity and distinction between the open fronthaul and the RIC, and also the integration…When you’re in this world of mixing multi-vendor on the fronthaul, RF and baseband, it’s quite complicated. Large-scale vendors have been doing this for 30 years. And to get to this point, it’s taken quite a lot of work and R&D effort. So when you’re introducing new vendors into that complex environment, you have to understand there’s quite a lot of testing and interoperability that we do that’s behind the scenes.”
This piece is excerpted from an interview with Hazon conducted during the Open RAN European Forum.