vRAN market disappoints – just like OpenRAN and mobile 5G
Most wireless network operators are not convinced virtual RAN (vRAN) [1.] is worth the effort to deploy. Omdia, an analyst company owned by Informa, put vRAN’s share of the total market for RAN baseband products at just 10% in 2023. It is growing slowly, with 20% market share forecast by 2028, but it far from being the default RAN architectural choice.
Among the highly touted benefits of virtualization is the ability for RAN developers to exploit the much bigger economies of scale found in the mainstream IT market. “General-purpose technology will eventually have so much investment in it that it will outpace custom silicon,” said Sachin Katti, the general manager of Intel’s network and edge group, during a previous Light Reading interview.
Note 1. The key feature of vRAN is the virtualization of RAN functions, allowing operators to perform baseband operations on standard servers instead of dedicated hardware. The Asia Pacific region is currently leading in vRAN adoption due to rapid 5G deployment in countries like China, South Korea, and Japan. Samsung has established a strong presence as a supplier of vRAN equipment and software.
The whole market for RAN products generated revenues of just $40 billion in 2023. Intel alone made $54.2 billion in sales that same year. Yet Huawei, Ericsson and Nokia, the big players in RAN base station technology, have continued to miniaturize and advance their custom chips. Nokia boasts 5-nanometer chips in its latest products and last year lured Derek Urbaniak, a highly regarded semiconductor expert, from Ericsson in a sign it wants to play an even bigger role in custom chip development.
Ericsson collaborates closely with Intel on virtual RAN, and yet it has repeatedly insisted its application-specific integrated circuits (ASICs) perform better than Intel’s CPUs in 5G. One year ago, Michael Begley, Ericsson’s head of RAN compute, told Light Reading that “purpose-built hardware will continue to be the most energy-efficient and compact hardware for radio site deployments going forward.”
Intel previously suffered delays when moving to smaller designs and there is gloominess about its prospects as note in several IEEE Techblog posts like this one and this one. Intel suffered a $17 billion loss for the quarter ending in September, after reporting a small $300 million profit a year before. Sales fell 6% year-over-year, to $13.3 billion, over this same period.
Unfortunately, for telcos eyeing virtualization, Intel is all they really have. Its dominance of the small market for virtual RAN has not been weakened in the last couple of years, leaving operators with no viable alternatives. This was made apparent in a recent blog post by Ericsson, which listed Intel as the only commercial-grade chip solution for virtual RAN. AMD was at the “active engagement” stage, said Ericsson last November. Processors based on the blueprints of ARM, a UK-based chip designer that licenses its designs, were not even mentioned.
The same economies-of-scale case for virtual RAN is now being made about Nvidia and its graphical processing units (GPUs), which Nvidia boss Jensen Huang seems eager to pitch as a kind of general-purpose AI successor to more humdrum CPUs. If the RAN market is too small, and its developers must ride in the slipstream of a much bigger market, Nvidia and its burgeoning ecosystem may seem a safer bet than Intel. And the GPU maker already has a RAN pitch, including a lineup of Arm-based CPUs to host some of the RAN software.
Semiconductor-related economies of scale, should not be the sole benefit of a virtual RAN. “With a lot of the work that’s been done around orchestration, you can deploy new software to hundreds of sites in a couple of hours in a way that was not feasible before,” said Alok Shah of Samsung Electronics. Architecturally, virtualization should allow an operator to host its RAN on the same cloud-computing infrastructure used for other telco and IT workloads. With a purpose-built RAN, an operator would be using multiple infrastructure platforms.
In telecom markets without much fiber or fronthaul infrastructure there is unlikely to be much centralization of RAN compute. This necessitates the deployment of servers at mast sites, where it is hard to see them being used for anything but the RAN. Even if a company wanted to host other applications at a mobile site, the processing power of Sapphire Rapids, the latest Intel generation, is fully consumed by the functions of the virtual distributed unit (vDU), according to Shah. “I would say the vDU function is kind of swallowing up the whole server,” he said.
Indeed, for all the talk of total cost of ownership (TCO) savings, some deployments of Sapphire Rapids have even had to feature two servers at a site to support a full 5G service, according to Paul Miller, the chief technology officer of Wind River, which provides the cloud-computing platform for Samsung’s virtual RAN in Verizon’s network. Miller expects that to change with Granite Rapids, the forthcoming successor technology to Sapphire Rapids. “It’s going to be a bit of a sea change for the network from a TCO perspective – that you may be able to get things that took two servers previously, like low-band and mid-band 5G, onto a single server,” he said.
Samsung’s Shah is hopeful Granite Rapids will even free up compute capacity for other types of applications. “We’ll have to see how that plays out, but the opportunity is there, I think, in the future, as we get to that next generation of compute.” In the absence of many alternative processor platforms, especially for telcos rejecting the inline virtual RAN approach, Intel will be under pressure to make sure the journey for Granite Rapids is less turbulent than it sounds.
Another challenge is the mobile backhaul, which is expected to limit the growth of the vRAN industry. Backhaul connectivity ia central s widely used in wireless networks to transfer a signal from a remote cell site to the core network (typically the edge of the Internet). The two main methods of mobile backhaul implementations are fiber-based and wireless point-to-point backhaul.
The pace of data delivery suffers in tiny cell networks with poor mobile network connectivity. Data management is becoming more and more important as tiny cells are employed for network connectivity. Increased data traffic across small cells, which raises questions about data security, is mostly to blame for poor data management. vRAN solutions promise improved network resiliency and utilization, faster network routing, and better-optimized network architecture to meet the diverse 5G requirements of enterprise customers.
References:
https://www.lightreading.com/5g/virtual-ran-still-seems-to-be-not-worth-the-effort
https://www.ericsson.com/en/blog/north-america/2024/open-ran-progress-report
https://www.sdxcentral.com/5g/ran/definitions/vran/