Rakuten Mobile in joint venture with Tokyo Electric Power Company (TEPCO) to expand 4G/5G network

Japanese wireless network operator Rakuten Mobile has established a new joint venture company in its domestic market with Tokyo Electric Power Company (TEPCO) to deploy base stations at existing power grid sites as it looks to further expand its 4G and 5G coverage in a more efficient way.

The new company, called Rakuten Mobile Infrastructure Solution, began operating in Tokyo on  July 1st. The entity has an initial nominal value of ¥300m (approximately $2.2m), with Rakuten Mobile owning a 51% stake in the venture and TEPCO holding the remaining 49% stake, the operator said in a statement (available in Japanese here).

Rakuten Mobile Infrastructure Solution is set to contribute to the telco’s vision for a stable communication environment by enhancing the efficiency of maintaining base stations through effective use of public assets. The new company will also look to develop installation specifications for Rakuten Mobile’s base station equipment and manage installation-related works.

The Japanese telecom industry upstart, which already covers 96% of the Japanese population with its 4G service, noted it is using “some power assets” to further build out its network.

Through the new company, Rakuten Mobile plans to expand its 4G and 5G networks, boost the density of base station deployments and “strengthen the development of communication infrastructure with the aim of providing stable services”. As it will use the existing power assets of TEPCO for the purpose (alongside the power company’s construction capabilities and know-how), the telco believes it can “improve the cost efficiency of base station maintenance”.

This is not the first engagement for the two companies: In March 2018, Rakuten Mobile secured an agreement to make use of TEPCO’s steel towers, power distribution poles, building roofs and other infrastructure, just a few months before it began building its greenfield cellular network, and in 2019 was part of a broader mobile operator initiative with TEPCO related to power grid infrastructure sharing.

References:

https://www.telecomtv.com/content/5g/rakuten-mobile-teams-up-with-power-grid-firm-to-accelerate-4g-5g-rollout-44870/

https://corp.mobile.rakuten.co.jp/english/

https://corp.rakuten.co.jp/news/press/2018/0306_01.html

June 2022 Ericsson Mobility Report: 5G subscriptions increased by 70 million in Q1-2022 to reach 620 million

Ericsson new Mobility Report [1.] states that mobile network data traffic grew 10% between the 4th quarter of 2021 and the 1st quarter of 2022. For the year-over-year comparison, growth reached 40%.  “In absolute numbers, this means that it has doubled in just two years (since Q1 2020),” the company wrote in its Mobility Report, released June 20th.  “Over the long term, traffic growth is driven by both the rising number of smartphone subscriptions and an increasing average data volume per subscription, fueled primarily by increased viewing of video content,” the company added.

The figures are important considering that mobile network operators are rushing to add new spectrum to their networks while upgrading their networks to support 5G, especially 5G SA Core Network. Purchasing both spectrum and 5G equipment is expensive. In the US, for example, mobile network operators are collectively spending an estimated $275 billion to improve their networks with more spectrum, cell sites and 5G.

Note 1. The Ericsson Mobility Report started in 2011, when Ericsson decided to share data and insights openly to all those interested in understanding our industry’s development. Since then, the report and featured articles have seen a continuous evolution and an expanding scope.

………………………………………………………………………………………………………………………………………………………………………………………………………….

Speaking during a webinar to discuss the report’s findings, Richard Möller, senior market analyst at Ericsson, noted that the number of 5G subscribers worldwide had been expected to reach 660 million by the end of 2021.  It now seems that the figure was less than forecast: Ericsson is now saying that 5G subscriptions increased by 70 million in Q1 2022 to reach 620 million.  The 40 million shortfall is due to changes in how China’s mobile operators are reporting their 5G subscriber figures. Indeed, it has become noticeable over the past year that the Chinese operators are starting to split out “5G package customers” from actual 5G network customers.

“Now we have official numbers and we’ve adjusted our estimates accordingly,” Möller said. “China is early and so large that it affects the global number.”   He noted that this adjustment does not “materially affect” the five-year growth forecast. Ericsson is therefore sticking to its estimate of 4.4 billion 5G subscribers by the end of 2027, meaning that 5G will account for almost half of all mobile subscriptions by that point.  5G subscriber growth is expected to accelerate in 2022, reaching around one billion subscribers by the end of the year. The report noted that North America and North East Asia currently have the highest 5G subscription penetration, followed by the Gulf Cooperation Council countries and Western Europe.  In 2027, it is projected that North America will have the highest 5G penetration at 90%. In India, where 5G deployments have yet to begin, 5G is expected to account for nearly 40% of all subscriptions by 2027.

At the same time, Möller warned that the war in Ukraine, supply chain constraints and rising inflation will affect future growth.  “That’s made us take 100 million subscriptions off the current forecast.  However, history has shown that mobile telephony is one of the things that people hang on to … even if the economic world turns negative,” he said.

The report’s executive editor Peter Jonsson said the current uncertainties mean that Ericsson has to be especially careful with its forecasts. However, he reiterated the point that global 5G uptake “is about two years ahead of 4G” on a comparative basis. In addition, 5G rollout “reached 25% of the world’s population about 18 months faster than 4G.”

Global mobile network data traffic and year-over-year growth:

According to Ericsson, mobile subscribers are making use of the additional network capacity and faster speeds provided by those investments. The company said that, globally, the average smartphone user is expected to consume 15GB per month in 2022.  Indeed, the 5G share of mobile data traffic is growing, but not as fast as FWA (3G/4G/5G).  Continued strong smartphone adoption and video consumption are driving up mobile data traffic, with 5G accounting for around 10 percent of the total in 2021.

In North America, the company estimated that average monthly mobile data usage per smartphone could reach as high as 52GB in 2027. “The data traffic generated per minute of use will increase significantly in line with the expected uptake of new XR and video-based apps,” the company wrote. “This is due to higher video resolutions, increased uplink traffic, and more data from devices off-loaded to cloud compute resources.”

Also, Fixed Wireless Access (FWA) in on the rise as per this graphic:

Over 100 million FWA connections in 2022:

More than 75 percent of service providers surveyed in over 100 countries are offering fixed wireless access (FWA) services. Around 20 percent of these service providers apply differential pricing with speed-based tariff plans.

OpenVault, another vendor that tracks data traffic on wired networks in North America, recently reported similar findings. According to OpenVault, the average wired Internet customer consumed a total of 536.3GB in the fourth quarter of 2021, an increase of 165% over the firm’s findings from the fourth quarter of 2017, when consumption was 202.6GB.

Taken together, the companies’ findings paint a picture of a dramatic expansion in data demand on wired and wireless networks in North America and globally. Indeed, such increases have already sparked unprecedented demand in vendors’ networking equipment to keep pace with demands. Further, such demand has already withstood several price increases among many leading vendors.

The situation reflects the importance of telecom networks globally following a pandemic that pushed many to work and school remotely from home. And in response to the situation, governments globally have begun pushing network operators to construct networks in underserved areas, and to Internet users themselves who may struggle to afford such connections.

 

References:

https://www.ericsson.com/en/reports-and-papers/mobility-report

https://www.ericsson.com/49d3a0/assets/local/reports-papers/mobility-report/documents/2022/ericsson-mobility-report-june-2022.pdf

https://www85.lightreading.com/5g/global-mobile-network-data-traffic-doubles-in-two-years-ericsson-finds/d/d-id/7783?

https://www.lightreading.com/5g/china-effect-dampens-interim-5g-subs-says-ericsson/d/d-id/778394?

https://www.ctia.org/the-wireless-industry/the-5g-economy

Will 2022 be the year for 5G Fixed Wireless Access (FWA) or a conundrum for telcos?

https://viodi.com/2020/05/05/openvault-broadband-usage-47-in-q1-2020-power-users-are-the-new-normal/

OpenVault: Broadband Internet Usage Accelerated in 2018

 

In India: What if Jio, Vi, and Airtel Skip 5G and Focus on 4G?

Telcos worldwide have already spent billions of dollars on setting up infrastructure, permissions, spectrum, and more for 4G and it is also bringing them plenty of revenues. While 5G will open up a whole new revenue stream from the enterprise sector, are the telcos really desperate for it?  India has yet to hold its first 5G auction which has been repeatedly delayed.

Reliance Jio,  Vodafone Idea (Vi), and Bharti Airtel are the only three PAN-India 4G operators in India right now. All the telcos have hundreds of millions of users in their subscriber base to whom they provide 4G network services. There are 2G users as well, but that’s a conversation for another day. Today, what I want to talk about is what if Jio, Vi, and Airtel don’t roll out 5G and just focus on 4G? Note that I very well know this isn’t going to happen. However, I couldn’t help but wonder, what if the telcos just went on with their usual 4G network services and didn’t care about 5G because of the steep spectrum price and the decision of the government to allow the enterprises to get airwaves directly in an administrative manner for captive private networks?

To be very honest, 5G doesn’t seem like the biggest deal-breaker for the telcos right now. From an investor perspective, the kind of expenditure that 5G would entail in 2022, factoring in spectrum price, among other things, doesn’t feel like a very solid option for Jio, Vi, or Airtel. Not to forget, Vi doesn’t even have the capacity to make large investments for 5G in the first place. Expenditure is not the issue; RoI (return on investment) is!

But one thing’s proven for the telecom operators – revenues from 4G networks. They have already spent billions of dollars on setting up infrastructure, permissions, spectrum, and more for 4G, and it is also bringing them plenty of money. While 5G will open up a whole new revenue stream from the enterprise sector, are the telcos really desperate for it? Well, I would argue not, despite fully acknowledging the fact that all the private companies just want to make more money. So, what will happen if the telcos really don’t go for 5G? Let’s take a look at the negatives first.

Negatives

The most obvious thing would be that consumers won’t get to see 5G anytime this year in any part of the nation. Second, enterprises would be very unhappy as not all of them might be looking to get the airwaves directly for setting up private 5G networks. Third, it would potentially affect the sales of 5G smartphones. Fourth, India will be left even further behind other nations in 5G network technology.

Positives

A delayed 5G rollout would mean that more users would start owning 5G smartphones over the long horizon and when telcos do launch 5G, it will be a more than ready market for them to monetise through retail consumers. Second, the industry and the government would get more time to sort through policies and the telcos would get sufficient room to set up a denser infrastructure.

Moreover, the telecom industry can upskill more people with knowledge about technologies such as 5G, AI, ML, and more which are going to be very relevant.

Again, it is unlikely that the telcos will miss out on 5G this year. But even if they do, I don’t think it is that big of an issue both from a consumer and an investor’s point of view. A seamless 4G experience is still something Indian consumers crave for! Hopefully, that is sorted along with the 5G rollout.

References:

What if Jio, Vi, and Airtel Skip 5G and Focus on 4G

Globe Telecom using next-generation antennas to facilitate 4G acceleration and 5G evolution

Philippine’s carrier Globe Telecom Inc. announced it is using next-generation antennas to facilitate 4G acceleration and 5G evolution.  The telco said it has completed the deployment of a new series of antennas that efficiently enables the acceleration of 4G and the evolution of 5G technology. Globe said that the antennas  adopts enhanced multi-array modules, ultra-high integration architecture, and full-band technology.  The deployment is seen to boost the company’s 4G and 5G network and ensure energy efficiency, Globe added.

“4G/5G deployment is accelerating and usage is continuously growing. The antenna is important for a network to have greater capacity, accelerate site deployment, have broader and deeper coverage, and achieve a low carbon footprint,” said Joel Agustin, SVP and Head of Network Planning and Engineering at Globe’s Network Technical Group.  “Globe is innovating with its vendor partners on the latest technologies available to improve customer experience through efficient 4G/5G network deployment,” he added

Since the antenna is smaller than the traditional design, Globe said it makes installation easier and faster even on cell sites with limited space.

The technology combines different frequency bands and accommodate different generations of cellular technologies, including 5G.

It also minimizes feed loss and improves energy efficiency, which means Globe can maximize energy efficiencies and lower electricity utilization through antenna development and power consumption innovation.

Globe said the use of the latest technology is part of its commitment to the United Nations Sustainable Development Goals, particularly UN SDG No. 9, which highlights the roles of infrastructure and innovation as crucial drivers of economic growth and development.

Globe has earmarked P89 billion for 2022 capital expenditures to roll out more 5G sites and in-building solutions, upgrade cell towers to 4G LTE, add more 4G cell sites, and lay down fiber to the homes.

The company deployed 380 new 5G sites in Metro Manila, Rizal, Cavite, Batangas, Bulacan, Davao, Cebu, Misamis Oriental, and Iloilo in the first quarter.

Globe is innovating with its vendor partners on the latest technologies available to improve customer experience through efficient 4G/5G network deployment.

References:

https://www.gizguide.com/2022/06/globe-uses-new-antennas-4g-5g.html

Summary of EU report: cybersecurity of Open RAN

The EU has published a report on the cybersecurity of Open RAN, a 4G/5G (maybe even 2G?) network architecture the European Commission says will provide an alternative way of deploying the radio access part of 5G networks over the coming years, based on open interfaces. The EU noted that while Open RAN architectures create new opportunities in the marketplace, they also raise important security challenges, especially in the short term.

“It will be important for all participants to dedicate sufficient time and attention to mitigate such challenges, so that the promises of Open RAN can be realized,” the report said.

The report found that Open RAN could bring potential security opportunities, provided certain conditions are met. Namely, through greater interoperability among RAN components from different suppliers, Open RAN could allow greater diversification of suppliers within networks in the same geographic area. This could contribute to achieving the EU 5G Toolbox recommendation that each operator should have an appropriate multi-vendor strategy to avoid or limit any major dependency on a single supplier.

Open RAN could also help increase visibility of the network thanks to the use of open interfaces and standards, reduce human errors through greater automation, and increase flexibility through the use of virtualisation and cloud-based systems.

However, the Open RAN concept still lacks maturity, which means cybersecurity remains a significant challenge. Especially in the short term, by increasing the complexity of networks, Open RAN could exacerbate certain types of security risks, providing a larger attack surface and more entry points for malicious actors, giving rise to an increased risk of misconfiguration of networks and potential impacts on other network functions due to resource sharing.

The report added that technical specifications, such as those developed by the O-RAN Alliance, are not yet sufficiently secure by design. This means that Open RAN could lead to new or increased critical dependencies, for example in the area of components and cloud.

The EU recommended the use of regulatory powers to monitor large-scale Open RAN deployment plans from mobile operators and if needed, restrict, prohibit or impose specific requirements or conditions for the supply, large-scale deployment and operation of the Open RAN network equipment.

Technical controls such as authentication and authorization could be reinforced and a risk profile assessed for Open RAN providers, external service providers related to Open RAN, cloud service/infrastructure providers and system integrators. The EU added that including Open RAN components into the future 5G cybersecurity certification scheme, currently under development, should happen at the earliest possible stage.

Following up on the coordinated work already done at EU level to strengthen the security of 5G networks with the EU Toolbox on 5G Cybersecurity, Member States have analysed the security implications of Open RAN.

Margrethe Vestager, Executive Vice-President for a Europe Fit for the Digital Age, said: “Our common priority and responsibility is to ensure the timely deployment of 5G networks in Europe, while ensuring they are secure. Open RAN architectures create new opportunities in the marketplace, but this report shows they also raise important security challenges, especially in the short term. It will be important for all participants to dedicate sufficient time and attention to mitigate such challenges, so that the promises of Open RAN can be realised.”

Thierry Breton, Commissioner for the Internal Market, added: “With 5G network rollout across the EU, and our economies’ growing reliance on digital infrastructures, it is more important than ever to ensure a high level of security of our communication networks. That is what we did with the 5G cybersecurity toolbox. And that is what – together with the Member States – we do now on Open RAN with this new report. It is not up to public authorities to choose a technology. But it is our responsibility to assess the risks associated to individual technologies. This report shows that there are a number of opportunities with Open RAN but also significant security challenges that remain unaddressed and cannot be underestimated. Under no circumstances should the potential deployment in Europe’s 5G networks of Open RAN lead to new vulnerabilities.”

Guillaume Poupard, Director General of France’s National Cyber Security Agency (ANSSI), said: “After the EU Toolbox on 5G Cybersecurity, this report is another milestone in the NIS Cooperation Group’s effort to coordinate and mitigate the security risks of our 5G networks. This in-depth security analysis of Open RAN contributes to ensuring that our common approach keeps pace with new trends and related security challenges. We will continue our work to jointly address those challenges.”

Finally, a technology-neutral regulation to foster competition should be maintained., with EU and national funding for 5G and 6G research and innovation, so that EU players can compete on a level playing field.

References:

https://ec.europa.eu/commission/presscorner/detail/en/IP_22_2881

https://digital-strategy.ec.europa.eu/en/library/cybersecurity-open-radio-access-networks

https://www.telecompaper.com/news/open-ran-creates-new-opportunities-but-also-security-risks-eu-report–1424010

IEEE/SCU SoE Virtual Event: May 26, 2022- Critical Cybersecurity Issues for Cellular Networks (3G/4G, 5G), IoT, and Cloud Resident Data Centers

This virtual event on ZOOM will be from 10am-12pm PDT on May 26, 2022.  

Session Abstract:

IEEE ComSoc and SCU School of Engineering (SoE) are thrilled to have three world class experts discuss the cybersecurity threats, mitigation methods and lessons learned from a data center attack. One speaker will also propose a new IT Security Architecture where control flips from the network core to the edge.

Each participant will provide a 15 to 20 minute talk which will be followed by a lively panel session with both pre-planned and ad hoc/ extemporaneous questions.  Audience members are encouraged to submit their questions in the chat and also to send them in advance to [email protected]

Below are descriptions of each talk along with the speaker’s bio:

Cybersecurity for Cellular Networks (3G/4G, 5G NSA and SA) and the IoT

Jimmy Jones, ZARIOT

Abstract:

Everyone agrees there is an urgent need for improved security in today’s cellular networks (3G/4G, 5G) and the Internet of Things (IoT). Jimmy will discuss the legacy problems of 3G/4G, migration to 5G and issues in roaming between cellular carriers as well as the impact of networks transitioning to support IoT.

Note: It’s important to know that 5G security, as specified by 3GPP (there are no ITU recommendations on 5G security), requires a 5G Stand Alone (SA) core network, very few of which have been deployed.  5G Non Stand Alone (NSA) networks are the norm, but they depend on a 4G-LTE infrastructure, including 4G security.

Cellular network security naturally leads into IoT security, since cellular networks (e.g. NB IoT, LTE-M, 5G) are often used for IoT connectivity.

It is estimated that by 2025 we will interact with an IoT device every 18 seconds, meaning our online experiences and physical lives will become indistinguishable. With this in mind it is as critical to improve IoT security as fastening a child’s seatbelt.

The real cost of a security breach or loss of service for a critical IoT device could be disastrous for a business of any size, yet it’s a cost seldom accurately calculated or forecasted by most enterprises at any stage of IoT deployment.  Gartner predicts Operational Technologies might be weaponized to cause physical harm or even kill within three years.

Jimmy will stress the importance of secure connectivity, but also explain the need to protect the full DNA of IoT (Device, Network and Applications) to truly secure the entire system.

Connectivity providers are a core component of IoT and have a responsibility to become part of the solution. A secure connectivity solution is essential, with strong cellular network standards/specifications and licensed spectrum the obvious starting point.

With cellular LPWANs (Low Power Wide Area Networks) outpacing unlicensed spectrum options (e.g. LoRa WAN, Sigfox) for the first time, Jimmy will stress the importance of secure connectivity and active collaboration across the entire IoT ecosystem. The premise is that the enterprise must know and protect its IoT DNA (Device, Network & Application) to truly be secure.

Questions from the audience:

I am open to try and answer anything you are interested in. Your questions will surely push me, so if you can let me know in advance (via email to Alan) that would be great!  It’s nice to be challenged a bit and have to think about something new.

One item of interest might be new specific IoT legislation that could protect devices and data in Europe, Asia, and the US ?

End Quote:

“For IoT to realize its potential it must secure and reliable making connectivity and secure by design policies the foundation of and successful project.  Success in digital transformation (especially where mission and business critical devices are concerned) requires not only optimal connectivity and maximal uptime, but also a secure channel and protection against all manner of cybersecurity threats. I’m excited to be part of the team bringing these two crucial pillars of IoT to enterprise. I hope we can demonstrate that security is an opportunity for business – not a burden.”

Biography:

Jimmy Jones is a telecoms cybersecurity expert and Head of Security at ZARIOT.  His experience in telecoms spans over twenty years, during which time he has built a thorough understanding of the industry working in diverse roles but all building from early engineering positions within major operators, such as WorldCom (now Verizon), and vendors including Nortel, Genband & Positive Technologies.

In 2005 Jimmy started to focus on telecom security, eventually transitioning completely in 2017 to work for a specialist cyber security vendor. He regularly presents at global telecom and IoT events, is often quoted by the tech media, and now brings all his industry experience to deliver agile and secure digital transformation with ZARIOT.

…………………………………………………………………………………………………………………………………………………………………………………………………………………….

Title:  Flip the Security Control of the Internet                             

Colin Constable, The @ Company

The PROBLEM:

With the explosion of Internet connected devices and services carrying user data, do current IT architectures remain secure as they scale? The simple and scary answer is absolutely no, we need to rethink the whole stack. Data breaches are not acceptable and those who experience them pay a steep price.

Transport Layer Security (TLS) encrypts data sent over the Internet to ensure that eavesdroppers and hackers are unable to see the actual data being transmitted.  However, the Router needs meta data (the IP and Port) to make it work.  What meta data does the Data level Router have access to?

We need to discuss how to approach the problem and selectively discard, but learn from previous IT architectures so that we can build a more solid, secure IT infrastructure for the future.

Proposition:

I will provide a glimpse of a future security focused IT architecture.

  • We need to move most security control functionality to the edge of the network.
  • Cloud data center storage should be positioned as an encrypted cache with encryption keys at the edge.
  • No one set of keys or system admin can open all the encrypted data.

When data is shared edge to edge we need to be able to specify and authenticate the person, entity or thing that is sharing the data.  No one in the middle should be able to see data in the clear.

Issues with Encryption Keys:

  • IT and Data security increasingly rely on encryption; encryption relies on keys; who has them?
  • Is there really any point to VPN’s Firewalls and Network segmentation if data is encrypted?
  • We use keys for so many things TLS, SSH, IM, Email, but we never tend to think about the keys.
  • Do you own your keys? If not someone else can see your data!
  • What do we need to flip the way IT is architected?

Recommendations for Keys:

  • Keys should be cut at the edge and never go anywhere else.
  • You should be able to securely share keys along with the data being transmitted/received.
  • There needs to be a new way to think about identity on the Internet.

The above description should stimulate many questions from attendees during the panel discussion.

Biography:

Colin Constable’s passion is networking and security.  He was one of the founding members of the Jericho Forum in the 2000s. In 2007 at Credit Suisse, he published “Network Vision 2020,” which was seen by some as somewhat crazy at the time, but most of it is very relevant now. While at Juniper, Colin worked on network virtualization and modeling that blurred the boundaries between network and compute.  Colin is now the CTO of The @ Company, which has invented a new Internet protocol and built a platform that they believe will change not just networking and security, but society itself for the better.

……………………………………………………………………………………………………………………….

The Anatomy of a Cloud Data Center Attack

Thomas Foerster, Nokia

Abstract:

Critical infrastructure (like a telecommunications network) is becoming more complex and reliant on networks of inter-connected devices. With the advent of 5G mobile networks, security threat vectors will expand. In particular, the exposure of new connected industries (Industry 4.0) and critical services (connected vehicular, smart cities etc.) widens the cybersecurity attack surface.

The telecommunication network is one of the targets of cyber-attacks against critical infrastructure, but it is not the only one. Transport, public sector services, energy sector and critical manufacturing industries are also vulnerable.

Cloud data centers provide the required computing resources, thus forming the backbone of a telecommunications network and becoming more important than ever.  We will discuss the anatomy of a recent cybersecurity attack at a cloud data center, review what happened and the lessons learned.

Questions:

  1. What are possible mitigation’s against social engineering cyber- attacks?

-Multifactor authentication (MFA)

-Education, awareness and training campaigns

  1. How to build trust using Operational Technology (OT) in a cloud data center?

Examples:

  • Access monitoring
  • Audits to international standards and benchmarks
  • Security monitoring
  • Playbooks with mitigation and response actions
  • Business continuity planning and testing

Recommendations to prevent or mitigate DC attacks:

  • Privileged Access Management across DC entities
  • Individual credentials for all user / device entities
  • MFA: One-Time Password (OTP) via text message or phone call considered being not secure 2-Factor Authentication anymore
  • Network and configuration audits considering NIST/ CIS/ GSMA NESAS
  • Regular vulnerability scans and keep network entities up to date
  • Tested playbooks to mitigate security emergencies
  • Business continuity planning and establish tested procedures

Biography:

Thomas Foerster is a senior product manager for Cybersecurity at Nokia. He has more than 25 years experiences in the telecommunications industry, has held various management positions within engineering and loves driving innovations. Thomas has dedicated his professional work for many years in product security and cybersecurity solutions.

Thomas holds a Master of Telecommunications Engineering from Beuth University of Applied Sciences, Berlin/ Germany.

……………………………………………………………………………………………………………………………………………………………………………………………………………………………..

Video recording of this event:  Critical Cybersecurity Issues for Cellular Networks, IoT, and Cloud-Resident Data Centers – YouTube

Previous IEEE ComSoc/SCU SoE March 22, 2022 event: OpenRAN and Private 5G – New Opportunities and Challenges

Video recording: https://www.youtube.com/watch?v=i7QUyhjxpzE

IDC Worldwide Private LTE/5G Wireless Infrastructure Forecast reveals 4G-LTE Dominates

The global private LTE/5G wireless infrastructure market is forecast to reach revenues of $8.3 billion by 2026, an increase compared to revenues of $1.7 billion in 2021, according to new research from International Data Corporation (IDC).  IDC said that this market is expected to achieve a five-year compound annual growth rate (CAGR) of 35.7% over the 2022-2026 forecast period.

The report, Worldwide Private LTE/5G Infrastructure Forecast, 2022-2026 (IDC #US48891622), presents IDC’s annual forecast for the private LTE/5G wireless infrastructure market. The forecast includes aggregated spending on RAN, core, and transport infrastructure as well as spending by region; it excludes services or publicly owned and operated networks that carry shared data traffic. The report also provides a market overview, including drivers and challenges for technology suppliers, communication service providers, and cloud providers.

IDC defines private LTE/5G wireless infrastructure as any 3GPP-based cellular network deployed for a specific enterprise/industry vertical customer that provides dedicated access to private resources. (Yet IDC does not state what 3GPP Release(s) or whether necessary 5G capabilities, like specs for URLLC have been completed and performance tested). This could include dedicated spectrum, dedicated hardware and software infrastructure, and which has the ability to support a range of use cases spanning fixed wireless access, traditional and enhanced mobile broadband, IoT endpoints/sensors, and ultra-reliable, low-latency applications.

“Enterprise or industry verticals, such as manufacturing, retail, utilities, transport, and public safety are leading the charge for private LTE, and eventually private 5G networks, driven by a desire to capture productivity gains, enable automation, and improve customer experience. While the demand metrics are relatively understood, the emerging private cellular ecosystem presents several road maps, each with particular advantages and disadvantages. While an enterprise (within any industry vertical) will eventually need to assess its own needs internally, understanding the implications from each road map can provide a starting point,” said Patrick Filkins, IDC senior research analyst, IoT and Mobile Network Infrastructure.

“The private LTE/5G wireless market showcased in 2021 that although its growth is somewhat immune to macro challenges associated with the global pandemic, it still requires a significant amount of market-level solutioning to address the pain points associated with unlocking the full 5G solution.  This includes curating and scaling a robust set of 5G device platforms, which still requires more work across the ecosystem, particularly as it relates to vertical-specific solutioning,”  Filkins added.

IDC noted that the worldwide market for private LTE/5G wireless infrastructure continued to gain traction throughout 2021. The research firm highlighted that private 4G-LTE remained the predominant private cellular network revenue generator during 2021. However, Private 5G marketing, education, trials, and new private 5G products and services also began to see market availability. IDC also said that most private 5G projects to date remain as either trials or pre-commercial deployments.

“Heightened demand for dedicated or private wireless solutions that can offer enhanced security, performance, and reliability continue to come to the fore as both current and future applications, particularly those in the industrial sector, require more from their network and edge infrastructure.  While private LTE/5G infrastructure continues to see more interest, the reality is 5G itself continues to evolve, and will evolve for the next several years. As such, many organizations are expected to invest in private 5G over the coming years as advances are made in 5G standards, general spectrum availability, and device readiness,” Filkins said.

The report forecasts that the market for 5G private networks will reach $47.5 billion in 2030, up from $221 million last year, while the total market for 4G private networks will go from $3.54 billion in 2021 to $66.88 billion in 2030.  IDC also noted that the global spending on smart manufacturing will expand from $345 billion in 2021 to more than $950 billion in 2030.

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

The total addressable market for private networks – including the Radio Access Network, Mobile-access Edge Computing (MEC), core, and professional services – is forecast to increase from $3.7 billion in 2021 to more than $109.4 billion in 2030, according to a recent report by ABI Research.  However, a quote in the article introducing that report was dead wrong:

“While the Third Generation Partnership Project (3GPP) has frozen Release 16 (standardizing Ultra-Reliable Low-Latency Communication (URLLC)), Release 16-capable chipsets and devices have not yet emerged in the market. As enterprises require Time-Sensitive Networking (TSN), as well as high availability and reliability of their connection, they are reliant on Release 16 and are, therefore, waiting for compatible chipsets and infrastructure to enter the market. As this is not expected to happen until 2023, enterprise 5G will mature much more slowly than previously anticipate,” ABI Research said.

–>THAT IS BECAUSE EVEN THOUGH 3GPP RELEASE 16 WAS FROZEN IN JUNE 2020,  “URLCC IN THE RAN” SPEC WAS NOT COMPLETED AT THAT TIME.  Before that spec can be implemented, it must be independently tested to ensure it means the ITU-R M.2410 performance requirements for BOTH ultra high reliability and ultra low latency corresponding to the 5G URLLC use case.  As of 16 March 2022 (today), 3GPP Release 16 URLLC in the RAN is only 74% complete!

830074 NR_L1enh_URLLC Physical Layer Enhancements for NR Ultra-Reliable and Low Latency Communication (URLLC) 74% Rel-16 RP-191584

ABI also noted that the global spending on smart manufacturing will expand from $345 billion in 2021 to more than $950 billion in 2030.

Note: 2022 to 2030 are forecasts.  Source: ABI Research

“As manufacturers advance their digital transformation initiatives, they drive up spending on smart manufacturing with investments in factories that adopt Industry 4.0 solutions like Autonomous Mobile Robots (AMRs), asset tracking, simulation, and digital twins,” ABI said. ” While most of the revenue today is attributed to hardware, the greater reliance on analytics, collaborative industrial software, and wireless connectivity (Wi-Fi 6, 4G, 5G) will drive value-added services revenue — connectivity, data and analytic services, and device and application platforms — to more than double over the forecast.”

Meanwhile, Dell’Oro Group VP Stefan  Pongratz wrote in an email to this author,” We have talked about private cellular for a long time but the reality is that we have not yet crossed the enterprise chasm. Nevertheless, we have a very large market opportunity ($10B to $20B for just the private 4G/5G RAN) that is still up for grabs, hence the high level of interest.

About IDC:

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,200 analysts worldwide, IDC offers global, regional, and local expertise on technology, IT benchmarking and sourcing, and industry opportunities and trends in over 110 countries. IDC’s analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world’s leading tech media, data, and marketing services company.

References:

https://www.idc.com/getdoc.jsp?containerId=prUS48948422

https://www.idc.com/getdoc.jsp?containerId=US48891622

Global market for private networks to exceed $109 billion in 2030: Study

https://www.3gpp.org/DynaReport/GanttChart-Level-2.htm (Release 16)

Dell’Oro: LTE still dominates private wireless market; will transition to 5G NR (with many new players)

 

Strand Consult: MWC 2022 Preview and What to Expect

by John Strand

Tomorrow the Mobile World Congress (MWC) opens physically in Barcelona and also online. Every year for the last 19 years, Strand Consult has published previews of the Mobile World Congress (MWC). After its cancellation in 2020, MWC 2021 was a shadow of its former self, though the hybrid in person/online format brought 30,000 participants. 2022 promises to bring some 50,000, one of the largest gatherings since the pandemic began.

Recall that 2019 MWC had some 110,000 participants and 2400 exhibitors. It’s come a long way from its start 36 years ago in Cannes, cozy enough that attendees to mingle at the Hotel Majestic’s bar following each day’s events.

Like the process for MWC, many people have been returning to normal after Covid. However the world has been gripped by the invasion of Ukraine by Russia, an absurd act against a sovereign, democratic nation which became independent in August 1991. Most democratic countries are united against Russia’s action. GSMA canceled the event’s Russian Pavilion and barred some Russian firms per international sanctions. Consider how Telenor stood up to dictatorship in Myanmar: by selling their assets and leaving the country. Pressure could grow for GSMA to suspend its Russian members.

Covid-19 has had a big impact on how people use mobile telecom services as well as the over-top players like Google, Facebook, Amazon, Apple etc. Historically GSMA kept a low profile on political matters. However that is increasingly difficult in a connected world when people communicate globally and have expectations of their service providers. Mobile operators and trade organizations like GSMA no longer have the luxury to focus solely on short-term profit and remain passive to aggression and autocracy.

MWC Buzzwords: 5G, OpenRAN, AI, Cloud, IoT, Green, and Diversity:

GSMA Director General Mats Granryd will open the conference, and it’s natural that this Swede would look to create consensus among 750 mobile operator members. He has a tough job to tell regulators that the industry needs better conditions while defending his members’ request for subsidies among other industries which have fared far worse than mobile telecommunications. As usual, he will focus on the latest hype and avoid the uncomfortable, which is too bad for journalists who want answers to critical questions.

Granryd will probably make the point that 5G is growing quickly: over 200 5G mobile networks based on 3GPP standards have now been launched around the world. If 4G was about the smartphone app economy, 5G is about disrupting the wireline home broadband market and opportunities for industry to integrate people and machines intelligently. There are hundreds of millions of new 5G customers. It’s an impressive accomplishment, but it’s doubtful that this can be turned into greater revenue for mobile operators’ shareholders. To date, the money has flowed to Big Tech.

Granryd will also tout the greening of the industry, though careful not to point out that the total energy footprint of the industry is growing. More traffic, devices, connections, network sites, and applications means more energy use. Not all of this is green and much is “greenwashing.”

The other hot topic is diversity, which has been moved from the last day of the conference to the first. The new Diversity4Tech replaces what was Women4Tech, an effort ended prematurely without success. Indeed, half of the world’s mobile subscribers are women, but there are still too few female executives in the mobile industry. Only 3 of GSMA’s 26 board members are women. It’s embarrassing that GSMA has not performed better on this metric. The only woman in the mobile leader line up is President & CEO of Telia Allison Kirkby who speaks on the New Tech Order.  Tellingly, the session features three Chinese men: Yang Jie, Chairman, China Mobile; Ruiwen Ke, Chairman & CEO, China Telecom; and LieHong Liu, Chairman & CEO, China Unicom. Diversity, equity, and inclusion (DEI) are unlikely to be themes in the remarks of China’s state-owned operators. Moreover, they are unlikely to mention state-sponsored cyberattacks which are growing more frequent, more sophisticated, and more severe.

Oddly enough this MCW features a keynote by FC Barcelona President Joan Laporta. The program text boasts that the European football market is worth over $25 billion dollars and growing. In reality, football (soccer) is not an industry that mobile operators should emulate. Not only is FC Barcelona $1.57 billion in debt, it had to let Lionel Messi go because it couldn’t honor its financial contract. More largely, the salaries for superstars like Messi, Ronaldo and, others are breaking the cable industry. GSMA is probably thanking its lucky stars that it didn’t feature Chelsea FC owner Roman Abramovich, a Russian oligarch and Friend of Putin who invested in the UK’s Truphone in 2006.

In any event, Ukraine is a communication game changer. Look at Germany’s Chancellor Olaf Scholz now committing to pay the full freight of NATO dues, something that former Chancellor Merkel refused do to.

Regulation, the never-ending story:

MWC should be the opportunity for mobile operators take a victory lap. The mobile telecom industry salvaged society from the pandemic, allowing people to work, learn and receive health care from home. Moreover, many operators have commendable plans to be carbon neutral in the near future. Yet GSMA has failed utterly to build on mobile operators’ good citizenship to modernize regulation and kick start much-needed consolidation. Instead many authorities want to double-down on failed regulatory policies like net neutrality and are even-more entrenched against mergers. GSMA lacks a coherent strategy of policy and communication to convince competition authorities and regulators to adopt a modern framework for consolidation, investment, and innovation.

Strand Consult has studied mobile industry consolidation globally for more than 20 years and just published the definitive report on 4 to 3 mobile mergers. It describes why European operators don’t pass the acid test on consolidation and why they fail to succeed.

Strand Consult has published hundreds of research notes, reports, and articles about net neutrality around the world. Notably the leading countries for 5G; Japan, South Korea, China, and USA have no net neutrality rules, or only soft rules. It is no surprise that European countries were late to 5G. Strand Consult has documented how the Body of European Regulators (BEREC) has consistently prioritized the needs of a small cadre of so-called “civil society” advocates over Europeans as whole who want more mobile telecom innovation and investment.

More largely, the measures taken by the European Union to “tame” Big Tech have had the opposite effect. Since Margrethe Vestager became Competition Commissioner in November 2017, Big Tech companies have increased their turnover, market share and earnings.

GSMA promotes Clouds:

Where GSMA fails to communicate the value proposition of mobile operators and demand the needed regulatory update, it does a great job to promote cloud providers.  Once again, mobile operators are set up to be the biggest losers while Big Tech firms Google, Apple, Amazon, and Microsoft are poised take the lion’s share of the 5G profits of connectivity, just as they did with 4G.

Few understand what AWS means for Amazon. AWS controls about a third of the global cloud market, substantially more its closest competitors Microsoft Azure and Google Cloud. In Q4 FY 2021 AWS generated net sales of $17.8 billion and operating income of $5.3 billion. Net sales grew 39.5% while operating income rose 48.5% compared to the year ago quarter. The value continues to increase as cloud services are integrated with artificial intelligence (AI) and other services.

Here are some critical questions to help you navigate the “cloudnet” sessions

  1. Why are clouds, which are fundamental to the running of 5G and 5G services, not subject to regulation, like mobile operators?
  2. Why do regulators obsess about market power of mobile operators while being oblivious to cloud providers Google, Microsoft, Amazon, and increasingly Huawei?
  3. What has been governments’ strategic blunder in the focus of restricting Huawei in 5G? (Hint: They forget about Huawei in the cloud. See Strand Consult’s note.
  4. How easy or difficult is it for customers to migrate from one cloud to another? Is data portable from Amazons AWS to Microsoft´s Azure?

3G, 4G, 5G: Where does the cash flow?

At MWC, there is always discussion about the next generation or G. However there is little discussion of the cash flow. Here are the cold, hard facts to consider.

  1. Many mobile operators believed in 2000 that 3G would be a gold mine for their revenues. They spent billions of euros on spectrum, but the revenue projections that ARPU will grow from to €36 to €72 per month fell far below expectation, ARPU declined.
  2. There are very few examples of successful partnerships that mobile operators have realized under 3G and 4G. In general, the revenue has flowed to the OTT or third-party providers, not operators.
  3. The value created in 4G has flowed to Google’s and Apple’s app stores which take a significant revenue cut of the apps on offer.
  4. Over the years, operators have attempted to launch various application programming interfaces (APIs) that third parties could integrate into their services. Some of these actions have been successful, like premium SMS. From 1998 onwards, mobile operators have been successful to offer premium SMS to pay for various digital services. Strand Consult was the first to publish research on this market and business models. Many of the world’s mobile operators followed our recommendations when it came to how to implement and operate a market with a short code where mobile customers could use to pay for services. See Strand Consult’s old report and research note about premium SMS
  5. Later around 2009 at MWC, GSMA launched OneAPI, about which we published a lot of research. Unfortunately, the operators did not know how to operate this market and create an ecosystem. Look at the research note ”One API is good news”. While this was a welcome development at the time, it did not develop into a revenue stream.
  6. Since that time, operators have been transformed into “dumb pipes”, mainly generating revenue from traffic they sell, not by adding value with better or different services. Mobile operators have little to no ability to monetize their own value-added services. In fact WhatsApp has cannibalized mobile operators’ SMS revenue. For example from 2012 to 2013, KPN´s SMS revenue declined by €100 million as customers switched to WhatsApp for messaging.
  7. There is only limited experience to reference for mobile operators’ 5G partnerships. The current version of 5G is 3GPP release 14 and 15 which do not have a functionality that is more advanced than 4G. Mobile operators have a dream to make money from 5G in the same way they dreamed it for 3G and 4G.
  8. Moreover, the EU regulatory environment with hard net neutrality rules and BEREC’s draconian over-interpretation of the rules have created an environment which discourages, if not prohibits, partnerships for mobile operators in 5G. It is not surprising that telecom investment has languished for years in EU.
  9. At MWC there are likely many PowerPoint presentations which describe proposed partnerships between mobile operators and other technology providers. However the business models are not in place, and many mobile operators have an unrealistic view of their ability to monetize value-added services.
  10. The reality is that to innovate in 5G, firms like Apple and Google, only need to add a new layer on their existing business. They are a proven partner. However mobile operators are required to do the essential retooling of networks. Mobile operators thus have a higher bar for 5G. They have to build an new ecosystem to convince a partner to join, where as Apple, Google and AWS only need, to extend their ecosystem with 5G services.

The role of mobile operators in the value chain has been decimated in the last two decades. It is not a question how mobile operators will react to 5G, but whether they have the skills at all to execute.

OpenRAN and Vendor Diversity – What does that mean?

The latest MWC hype is OpenRAN and the invented term “vendor diversity”. Much of the hype is driven by OpenRAN players which claim that the market for mobile infrastructure equipment is controlled by Huawei, Ericsson, Nokia and ZTE.  However, MWC features some 2000 exhibitors which supply infrastructure equipment to over 750 mobile operators. Note that the need for “vendor diversity” is not addressed with cloud providers.

Many OpenRAN pronouncements sound too good to be true, for example a technology that can reduce mobile operators infrastructure CAPEX and OPEX by 30-40 percent. Investors and other decision makers want objective information about the latest mobile industry hype. Strand Consult’s free report Debunking 25 Myths of OpenRAN examines the claims made by OpenRAN proponents. Strand Consult, having witnessed the launch of WiMax, OneAPI, and the iPhone among other hyped technologies promised to bring windfall revenues to mobile operators, provides critical questions to evaluate OpenRAN in its latest report.

The main challenge for OpenRAN is whether it can be relevant for operators which have very little room for margin of error. OpenRAN is far from being able to replace classic infrastructure on a 1:1 basis.

OpenRAN testing has been launched in a world in which mobile operators buy and build classic RAN at a high rate. There are two reference cases. One is Rakuten in Japan driven by charismatic CEO Tareq Amin. Rakukten gives away free traffic without getting paying customers into the store. It’s solution is proprietary, not open.

The US-based Dish is the second. It faces many challenges which make it hard to see how it can become a serious alternative to Verizon, AT&T and T-Mobile

The Federal Communication Commission (FCC) proceeding on OpenRAN showed few, if any examples, of US mobile operators and their trade associations (CTIA, Rural Wireless Association, and Competitive Carriers Association) testifying that OpenRAN is a serious alternative to classic RAN installations.

MWC offers an opportunity to meeting mobile operators’ Chief Technology Officers. Ask them what they think of OpenRAN why they have launched 5G using classic RAN based on 3GPP standards.

The history of OpenRAN is reminiscent of WiMax. If you have some of the PowerPoints from the early 2000s, you will see how  infrastructure vendors talked about why WiMax was so amazing. These points are almost identical to what is asserted about OpenRAN.

To assess claims about vendor diversity, it’s important to look at facts and history. The infrastructure supplier market has consolidated from 20 top tier providers in the 2G market in 1989 to 12 top tier providers in 1999 to 5 top tier providers in 2019. Many of the first-generation enthusiasts did not make it out of the 1G analogue cellular world into the world of 2G digital cellular. Over time the GSM standards family (GSM, WCDMA, LTE etc.) became the de facto basis for the roadmap, the standard for global economies of scale and the industry benefits such as lower unit costs. Those equipment suppliers which focused on CDMA and analog exited the market.

There is also the practical issue of math. The notion of vendor diversity for its own sake challenges operators to reduce complexity and cost in their networks. Operators frequently reduce the number of vendors to improve security (ability to vet vendors and develop trusted relationships) and to lower cost (ability to secure volume discounts). Indeed operators want concentration in part to get better value for money.

Note how Neil McRae, Managing Director and Chief Architect at British Telecom described when he got the question; “The major operators have been telling their shareholders since 2000 that they should reduce suppliers to save money?”. He replied, I have worked with BT for 10 years. When I arrived, BT had a 21 C fixed network with 50 vendors. I reduced it to 4 vendors and saved BT £1 billion in 3 years. The key was reducing complexity, which is the killer in telecommunications. When I hear about Open architectures with 5- 50 vendors, I run for the hills. Reducing vendors was the right thing to do and we would do it again.”  RAN, while important, is just one part of an operator’s infrastructure requirements.

Moreover, the consolidation of European infrastructure is the result of many European operators having opted into Huawei and opted out of European suppliers.

The active customer base of Europe’s 102 mobile operators is 673 million subscribers. Huawei’s and ZTE’s share of 4G RAN mobile networks are 44% and 4% respectively, total 48%.This means that 325 million European mobile customers access Chinese infrastructure, primarily from Huawei. Countries are divided into four categories of share of 4G RAN equipment from Chinese suppliers: 75-100%; 50-75%; 25-50%; and less than 25%.In its RAN report Strand Consult has mapped the market for 4G RAN in Europe.

More than 40% of the CAPEX that European operators have used every year for the last 10 years has been shipped to China and Chinese suppliers like Huawei and ZTE. If you look at the American operators, most of their CAPEX has gone to European suppliers Nokia and Ericsson. We thought that the EU should thank the US operators and the US government for their massive support for European manufacturers and for their fight against the use of Chinese equipment from Huawei and ZTE. The five operators Vodafone, TIM, Telefonica, Orange and Deutsche Telekom have for several years opted for Chinese manufacturers at the expense of European vendors. 62% of Vodafone´s 4G RAN in Europe are from Huawei.

The fact is that RAN Capex makes up less than 3 percent of a mobile operator’s ARPU. The global RAN market is today $29 billion and can be pitted against Verizon’s Capex which amounts to $18 billion.

The bottom line for MWC

Strand Consult has limited expectation for mobile operators’ profitability in 5G. Operators may have ambitions, but the question is whether they have the skills to build an ecosystem that can compete with Apple, Google, and AWS. However, operators can do better on the policy front to modernize regulation and promote consolidation.

Under the current frameworks, there is little to no upside for operators. Mobile operators must consolidate to cut cost and increase profitability. They will probably continue to sell off infrastructure. They continually become dumb pipes. There’s nothing wrong with being a dumb pipe; it’s a business model that works quite fine in water and energy. But don’t expect it to be innovative.

In practice, this development means that many functions from telecom regulators have become irrelevant. The primary task of the telecom regulator of the future will be to deal with spectrum.

Technology companies build services on top of US and Chinese platforms. Many of the smaller technology companies are driven by the construction of a business with the aim of being acquired by these tech companies. A good example is Facebook’s purchase of WhatsApp for $16 billion in February 2014.

There will be many interesting discussions on 5G, OpenRAN, IOT and AI, including the need for more security and transparency. In any event, MWC is always a party because of the cool people who attend giving food for thought to those who want to be stimulated intellectually. Moreover Barcelona’s bars and restaurants rarely disappoint.

Strand Consult provides both pre and post review of the Mobile World Congress. Read reviews from the past years.

Meet Strand Consult at the Mobile World Congress:

If you would like to meet with Strand Consult during the MWC, please email your contact details and the details/purpose of the meeting, and we will get back to you. Journalists are most welcome!

………………………………………………………………………………………………………………………………………………………………………

Biography:

John Strand founded Strand Consult in 1995. Since then, hundreds of companies in the telecom, media and technology industries have attended Strand Consult’s workshops, purchased reports, consulted with the company to develop strategy, launch new products, and conduct a dialogue with policymakers.

John Strand sits on the advisory board of a number of Scandinavian and International companies and is a member of the Arctic Economic Council Telecommunications Working Group. He served on the Advisory Board for the 3GSM World Congress, the event known as the Mobile World Congress in Barcelona.

References:

Strand Consult: Open RAN hype vs reality leaves many questions unanswered

O-RAN Alliance tries to allay concerns; Strand Consult disagrees!

Strand Consult: What NTIA won’t tell the FCC about Open RAN

44 Chinese companies have joined the O-RAN Alliance

 

Strand Consult: 5G in 2019 and 2020 telecom predictions

 

 

Intel FlexRAN™ gets boost from AT&T; faces competition from Marvel, Qualcomm, and EdgeQ for Open RAN silicon

Dell’Oro Group estimates the RAN market is currently generating between $40 billion and $45 billion in annual revenues. The market research firm forecasts that Open RAN will account for 15% of sales in 2026. Research & Markets is more optimistic.  They say the Open RAN Market will hit $32 billion in revenues by 2030 with a growth rate of 42% for the forecast period between 2022 and 2030.

As the undisputed leader of microprocessors for compute servers, it’s no surprise that most of the new Open RAN and virtual RAN (vRAN) deployments use Intel Xeon processors and FlexRAN software stack inside the baseband processing modules.   FlexRAN  is a vRAN reference architecture for virtualized cloud-enabled radio access networks.

The hardware for FlexRAN includes:  Intel® Xeon® CPUs 3rd generation Intel® Xeon® Scalable processor (formerly code named Ice Lake scalable processor), Intel® Forward Error Correction Device (Intel® FEC Device), Mount Bryce (FEC accelerator), Network Interface Cards – Intel® Ethernet Controller E810 (code name Columbiaville).  Intel says there are now over 100 FlexRAN licensees worldwide as per these charts:

Source: Intel

A short video on the FlexRAN™ reference architecture is here.

FlexRAN™ got a big boost this week from AT&T.  In a February 24, 2022 blog post titled “Cloudifying 5G with an Elastic RAN,” Gordon Mansfield, AT&T VP Mobility Access & Architecture said that “AT&T and Intel had co-developed an industry-leading advanced RAN pooling technology freeing 5G radios from the limitations of dedicated base stations, while enabling more efficient, resilient, and green 5G networks.  DU-pooling will eventually be usable by the entire 5G operator community to drive the telecom industry’s goals of green and efficient wireless networks forward.”

DU pooling technology was made possible by combining AT&T’s deep knowledge of Open RAN technologies as one of the co-founders of the O-RAN Alliance with Intel’s expertise in general purpose processors and software-based RAN through its FlexRAN™ software stack running on Intel 3rd generation Intel® Xeon® Scalable processors. The open standards for communications between radios and DUs that were published by O-RAN enabled its development, and the result is a technology demonstrator implemented on FlexRAN software.

………………………………………………………………………………………………………………………………………………………………………………..

Intel is now facing new Open RAN competition from several semiconductor companies.

Marvell has just unveiled a new accelerator card that will slot into a Dell compute server (which uses x86 processors). Based on a system called “inline” acceleration, it is designed to do baseband PHY layer processing and do it more efficiently than x86 processors. A Marvell representative claims it will boost open RAN performance and support a move “away from Intel.”  Heavy Reading’s Simon Stanley (see below) was impressed.  “This is a significant investment by Dell in open RAN and vRAN and a great boost for Marvell and the inline approach,” he said.

Qualcomm, which licenses RISC processors designed by UK-based ARM, has teamed up with Hewlett Packard Enterprise (HPE) on the X100 5G RAN accelerator card.  Like Marvel’s offering, it also uses inline acceleration and works – by “offloading server CPUs [central processing units] from compute-intensive 5G baseband processing.”

There is also EdgeQ which is sampling a “Base Station on a Chip” which is targeted at Open RAN and private 5G markets.  Three years in the making, EdgeQ has been collaborating with market-leading wireless infrastructure customers to architect a highly optimized 5G baseband, networking, compute and AI inference system-on-a-chip. By coupling a highly integrated silicon with a production-ready 5G PHY software, EdgeQ uniquely enables a frictionless operating model where customers can deploy all key functionalities and critical algorithms of the radio access network such as beamforming, channel estimation, massive MIMO and interference cancellation out of the box.

For customers looking to engineer value-adds into their 5G RAN designs, the EdgeQ PHY layer is completely programmable and extensible. Customers can leverage an extendable nFAPI interface to add their custom extensions for 5G services to target the broad variety of 5G applications spanning Industry 4.0 to campus networks and fixed wireless to telco-grade macro cells. As an industry first, the EdgeQ 5G platform holistically addresses the pain point of deploying 5G PHY and MAC software layers, but with an open framework that enables a rich ecosystem of L2/L3 software partners.

The anticipated product launches will be welcomed by network operators backing Open RAN.  Several of them have held off making investments in the technology, partly out of concern about energy efficiency and performance in busy urban areas. Scott Petty, Vodafone’s chief digital officer, has complained that Open RAN vendors will not look competitive equipped with only x86 processors. “Now they need to deliver, but it will require some dedicated silicon. It won’t be Intel chips,” he told Light Reading in late 2021.

…………………………………………………………………………………………………………………………………………………………………………………………………………………………..

Inline vs Lookaside Acceleration:

While Marvell and Qualcomm are promoting the “inline” acceleration concept, Intel is using an alternative form of acceleration called “lookaside,” which continues to rely heavily on the x86 processor, offloading some but not all PHY layer functions. This week, Intel announced its own product refresh based on Sapphire Rapids, the codename for its next-generation server processors.

Simon Stanley, an analyst at large for Heavy Reading (owned by Informa), said there are two key innovations. The first involves making signal-processing tweaks to the Sapphire Rapids core to speed up the performance of FlexRAN, Intel’s baseband software stack. Speaking on a video call with reporters, Dan Rodriguez, the general manager of Intel’s network platforms group, claimed a two-fold capacity gain from the changes. “In the virtual RAN and open RAN world, the control, packet and signal processing are all done on Xeon and that is what FlexRAN enables,” he said.

The other innovation is the promise of integrated acceleration in future Sapphire Rapids processors. Sachin Katti, who works as chief technology officer for Intel’s network and edge group, said this would combine the benefits of inline acceleration with the flexibility of x86. That is preferable, he insisted, to any solution “that shoves an entire PHY layer into an inflexible hardware accelerator,”  a clear knock at inline rivals such as Marvell and Qualcomm.   Despite Katti’s reference to inline acceleration, Stanley does not think it is Intel’s focus. “None of this rules out an inline acceleration solution, but it does not seem to be part of the core approach,” he told Light Reading. “The key strategy is to add maximum value to Xeon Scalable processors and enable external acceleration where needed to achieve performance goals.”

Both inline and lookaside involve trade-offs. Inline’s backers have promised PHY layer software alternatives, but Intel has a major head start with FlexRAN, which it began developing in 2010. That means lookaside may be a lot more straightforward. “The processor is in control of everything that goes on,” said Stanley during a previous conversation with Light Reading. “It is essentially the same software and makes life very easy.”

Larger network operators seemed more enthusiastic about inline during a Heavy Reading survey last year.  By cutting out the processor, it would reduce latency, a measure of the delay that occurs when signals are sent over the network. That could also weaken Intel, reducing power needs and allowing companies to use less costly CPUs. “If you use inline, you probably need a less powerful processor and less expensive server platform, which is not necessarily something Intel wants to promote,” Stanley said last year.

 

References:

https://www.intel.com/content/www/us/en/communications/virtualizing-radio-access-network.html

https://www.intel.com/content/www/us/en/developer/topic-technology/edge-5g/tools/flexran.html?wapkw=FlexRAN

https://www.lightreading.com/open-ran/intel-hits-back-as-rival-open-ran-chips-take-shape/d/d-id/775569?

https://www.lightreading.com/open-ran/intel-is-building-open-ran-fortress-but-its-also-under-attack/d/d-id/770094

EdgeQ Samples World’s 1st Software-Defined 5G Base Station-on-a-Chip

Dell’Oro: Mobile Core Network and MEC Stagnant in 2021; Will Growth in 2022

According to a recently published report from Dell’Oro Group, the total Mobile Core Network (MCN) and Multi-access Edge Computing (MEC) market 2021 revenue growth slowed to the lowest rate since 2017. The growth rate is expected to go higher in 2022 with the expansion of the 21 commercial 5G Standalone (5G SA) MBB networks that were deployed by the end of 2021, coupled with new 5G SA networks readying to launch throughout the year.

“MCN revenues for 2021 were lower than expected due to an unexpectedly poor fourth quarter performance.  The revenues for 4Q 2021 were lower than in 4Q 2020. The last time that happened was in 4Q 2017,” stated Dave Bolan, Research Director at Dell’Oro Group. “The poor performance in 4Q 2021 was due to negative year-over-year revenue performance for the China region. The performance for the rest of the world was almost flat but still negative and obviously was not enough to offset the decline in China.

“The growth in 2021 came from the 5G MCN segment and was not enough to offset the decline in 4G MCN and IMS Core. Of the 21 5G SA networks commercially deployed Huawei is the packet core vendor in seven of the networks, including the three largest networks in the world located in China, and Ericsson is the packet core vendor in 10 of the networks. Not surprisingly, of the top five vendors, only Huawei and Ericsson gained overall MCN revenue market share during 2021.

“Looking at the MEC market, MEC is still a fraction of the overall MCN market, but we believe two recent announcements by Ericsson are noteworthy because, in our opinion, Ericsson will accelerate the adoption of MEC and help 5G MNOs monetize their networks by coalescing MEC implementations around the 3GPP standards. Ericsson claims to be the first to leverage recent advancements by the 3GPP standards body for edge exposure, and network slicing all the way through to a smartphone,” continued Bolan.

Additional highlights from the 4Q 2021 Mobile Core Network Report:

  • Top-ranked MCN vendors based on revenue in 2021 were Huawei, Ericsson, Nokia, ZTE, and Mavenir.
  • The EMEA region was the only region to grow in revenue in 2021.
  • The APAC region was the largest region in revenue for 2021.

As of December 31, 2021 there were 21 known 5G SA eMBB networks commercially deployed.

5G SA eMBB Network

Commercial Deployments

Rain (South Africa)

Launched in 2020

China Mobile

China Telecom

China Unicom

T-Mobile (USA)

AIS (Thailand)

True (Thailand)

China Mobile Hong Kong

Vodafone (Germany)

Launched in 2021

STC (Kuwait)

Telefónica O2 (Germany)

SingTel (Singapore)

KT (Korea)

M1 (Singapore)

Vodafone (UK)

Smart (Philippines)

SoftBank (Japan)

Rogers (Canada)

Taiwan Mobile

Telia (Finland)

TPG Telecom (Australia)

About the Report

The Dell’Oro Group Mobile Core Network & Multi-Access Edge Computing Quarterly Report offers complete, in-depth coverage of the market with tables covering manufacturers’ revenue, shipments, and average selling prices for Evolved Packet Core, 5G Packet Core, Policy, Subscriber Data Management, and IMS Core including licenses by Non-NFV and NFV, and by geographic regions. To purchase this report, please contact us at [email protected].

References:

https://www.delloro.com/news/mobile-core-network-stagnant-in-2021-poised-for-growth-in-2022/

https://techblog.comsoc.org/2022/01/19/mobile-core-network-mcn-growth-to-slow-due-to-slow-roll-out-of-5g-sa-networks/

https://techblog.comsoc.org/2021/12/01/delloro-5g-sa-core-network-launches-accelerate-14-deployed/