Vendors at the Mobile World Congress (MWC) 2022 highlighted their developing understanding of the importance of flexible and interoperable private cellular network deployments by announcing augmented private 5G offerings built on Open Radio Access Network (open RAN) standards and delivered “as a service.” However, these changes can only go so far for new entrants as the largest network vendors will continue to benefit from enterprise vendor lock-in.
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Private Cellular Network Interoperability Took Center Stage at MWC 2022
Network vendors introducing expanded solutions that target flexible deployment were on center stage at MWC 2022. HPE introduced private 5G built on HPE 5G core stack with pre-integrated RAN solutions while other vendors (i.e., Cisco and ZTE) expanded their go-to-market strategy and introduced private networks–as-a-service. To industry experts, these announcements highlight that vendors and service providers recognize that reducing barriers to adoption, through interoperability and flexibility, will be the critical factor in driving private cellular network deployment over the next few years.
But one vendor has gone further than most to introduce greater interoperability and flexibility. Cisco’s private 5G service, using a service/pay-as-you-use model for network scalability, has introduced open RAN standards to reduce technical barriers to adoption and to unlock greater value for commercial private cellular network deployments.
Open RAN Will Lower Deployment Barriers for Brownfield Sites
Financial, operational, knowledge, and infrastructural barriers mean that deploying new, more efficient networking solutions can often be a long, difficult, and capital-intensive process, especially given the overhanging threat posed by vendor lock-in. Interoperability will be critical to reducing these barriers and unlocking the commercial validity of these network solutions for most enterprises.
Open RAN is a collaboration of equipment makers and telecoms to formulate standards on which networking equipment can be standardized. The aim is to enable enterprises to shift away from one-vendor models and deliver solutions that use both vertical (cross-technology) and horizontal (cross-vendor) collaboration. This is achieved by virtualizing part of the cellular network infrastructure such that core functions can be aligned. Open RAN infrastructure is built on three principles: cloudification (cloud-native disaggregation of hardware and software), intelligence (open orchestration and automation interfaces), and open interfaces (defined by 3GPP).
ABI Research expects that open RAN standards, when properly integrated, will drive private cellular network deployment. This will go a long way toward proving its case from a commercial perspective:
- Open RAN is likely to optimize deployment costs on brownfield sites (the process of upgrading or installing new hardware that must coexist/interoperate with legacy Information Technology [IT] systems) without the need to cancel old contracts or replace legacy infrastructure. Instead, private cellular networks can be deployed and operated in conjunction with legacy IT and be used to facilitate specific mission/life critical use cases rather than deployed universally.
- Open RAN will make the coexistence between LTE and 5G easier, enabling end users to tailor use-case and customer requirements to wireless connectivity. For example, the Internet of things requires LTE while augmented reality requires the latency offered by private 5G. By building a best-of-breed connectivity ecosystem, end users can better optimize costs.
- From a macro perspective, open RAN standards will reduce barriers to adoption, mitigate vendor lock-in, and encourage competition. This is likely to dampen costs and make private cellular networks more cost-effective for enterprises.
- Open RAN’s disaggregation of hardware and software will further reduce the total cost of ownership and stimulate operational efficiency by (1) reducing the cost and time of software upgrades, (2) reducing downtime, and (3) improving visibility and management for systems integrators and service providers, thereby reducing operational and management costs for enterprises.
- Open RAN will provide a flexible framework for vendors to distribute private cellular networks to enterprises and will require smaller deployments and large-scale public cellular network deployments to the consumer market.
Challenges Still Consume the Private Cellular Network Market
Why have network vendors been slow to apply open RAN standards? Open RAN’s complexity and immaturity are of chief concern and have slowed innovation. Many enterprises and vendors fear that a poorly constructed open RAN ecosystem will cause more issues than it solves. It is evident that latency could be increased and even greater downtime could result from poor coordination of vendor solutions. Moreover, open RAN standardization looks to add more headaches to the enterprise cybersecurity team. Interoperation among vendors, through increasing visibility, increases the attack surface while multivendor solutions hinder the efficient deployment of cybersecurity solutions.
These challenges are particularly damning given the mission/life critical use cases that private cellular networks, particularly 5G, are aiming to support. What strategies should network vendors and service providers look to introduce in order to work around these challenges and drive private network deployment?
- Demonstrate the efficient/secure interoperability of their networks. This is what network vendors are selling, and they need to prove its viability and efficiency to enterprise verticals. It is best for vendors to demonstrate this through open RAN partners as they lend credibility to proof of concept.
- Develop services in conjunction with security vendors to ensure that security principles are replicated across entire ecosystems. Like secure access service edge, developing a zero-trust framework may be an efficient and cost-effective strategy to deliver security.
- Establish clearly defined parameters and cost structures with complete transparency for as-a-service deployment.
- Innovate within private cellular network ecosystems to offer 5G and LTE to enterprises with an approach that helps enterprises match use cases with the best-suited connectivity technology.
A lot still needs to be done to establish the commercial and operational value of private cellular networks and convey this proposition to enterprise verticals. Open RAN standardization will, no doubt, go a long way to quell some interoperability and flexibility requirements, but ABI Research expects that proving its commercial validity will still rely on adjacent solutions—such as network slicing—as the infrastructure costs will remain a significant drain on its expected return on investment. On the supply side, traditional and more established vendors who continue to benefit from vendor lock-in will likely lose out the most by developing private cellular network on open RAN standards (as it enables interoperability and a transition to best-of-breed solutions), and innovation and deployment will continue, in the short run, to be slow.