Reconfiguring collaboration and competition with OpenRAN
A lack of interoperability has long been a feature of mobile networks, locking operators into long-term relationships with a single vendor. Not only does this potentially mean getting stuck with a higher cost and less flexibility in RAN network design, it can also slow time to market for new services and limit the kinds of experiences that can be offered to end users. The OpenRAN concept aims to change this. But OpenRAN is also a challenge to an industry where competition is traditionally based almost purely on functional performance.
Legacy systems, operational siloes and vendor lock-in are common barriers faced by operators trying to maintain, upgrade and optimise their networks. The industry centred around those with access to the best technology, proprietary functionality and vendor relationships. Operators did not have to consider whether their RAN architecture could integrate with that offered by other vendors, as that wasn’t their strategy for growth.
OpenRAN has emerged as a response to this lack of flexibility and agility. Making interoperability the foundation of network design, this new standard calls for enhanced collaboration between equipment makers and telecoms operators. As well as opening up new opportunities for value creation, OpenRAN could have long-lasting impacts on the shape of the industry, turbocharging a new era of innovation.
But competition between suppliers is only one part of the equation. Standardising the radio, distributed and centralised units means networks can be designed in a more modular way. The O-RAN alliance and Telecom Infra Project are examples of this collaboration among traditionally competitive companies already in action.
The risks of opening up
While OpenRAN has a lot of potential for reducing the time and cost of getting new services and revenue streams to market, it does carry its own potential challenges and risks. Adopting a multi-vendor approach opens the door to more flexibility, but also adds management complexity. Moving from a single trusted relationship to multiple new and untested ones can also introduce significant risk in terms of maintaining performance and achieving ROI. Managing software and hardware updates from multiple different sources could also improve the burden for operators as well as lead to increased opex.
All of this may impact the speed and accuracy of your operations and reduce your competitive advantage if poor choices are made. This problem of large-scale transformation not creating the intended business outcomes is one we help guard our clients against. When technology is valued over strategy, the end result is sometimes a set of poorly integrated, separate solutions. But equally, when strategy does not properly consider the technology available, it can create the same issue. Finding the right mix is the key challenge.
Unlocking the opportunities
The continued rollout of 5G makes network architecture that ensures low latency, high bandwidth and high availability a priority for operators. OpenRAN provides the flexibility to select components that provide the best performance and address demand more efficiently. But making the most of the opportunity to break free of legacy systems, vendor lock-in and traditional business models means strengthening collaborative networks across the telecoms industry.
Telecom companies know that they need to innovate and experiment to differentiate themselves. But the narrative around OpenRAN is dominated by vested interests. There are those like Vodafone and Telefonica that are pushing the standard because they believe it will help them win, and there are others such as BT that believe it with further complicate their operations. In this environment, picking the right partners and innovating together can be difficult. OpenRAN calls for new forms of collaboration and risk taking, but a lack of accurate market information is hampering the ability of companies to make data-driven decisions about what their strategies should be.
When change is a constant and speed is the key commodity, making the right strategic and technology decisions is the source of success. But this is easier said than done. This is why we work with companies to build an objective view of their options and help them put in place the right strategy, business case, and innovation roadmap to ensure they can move quickly whilst mitigating the risks of wrong turns. By future forecasting, defining business outcomes, quantifying risk/reward and helping to select partners, we help our clients cut through the noise around OpenRAN and hone in on the opportunities to drive value right now. Companies that take too long to act risk being left behind.
This is the beginning of an exciting period of innovation for cellular networks, as companies of all sizes explore how they can innovate and drive improvements in performance and user experience within an OpenRAN ecosystem. Standing still is not an option, and companies need to carefully consider their next steps.
Moving from a single to multi-vendor approach requires rock-solid strategy as well as the ability to adapt, learn and evolve fast. We are on hand to help you put all the pieces in place.