Rakuten Mobile’s Open Virtual Radio Access Network at the Pace of Technology Innovation

As 5G New Radio (NR) networks emerge, the rapid growth of data traffic and different types of end user requirements are now motivating mobile operators to look for new service revenue opportunities and reduce the cost of deploying and operating networks. To drive innovation in establishing a new cost-effective and flexible operating strategy, Rakuten Mobile started to develop the world’s first End-to-End (E2E) cloud-native mobile network in April 2019, with one of its main focuses being open virtualized Radio Access Network (vRAN). It is normal for 60% to 65% of the total cost of ownership of a network in developed markets to be in the RAN domain. Rakuten’s open vRAN approach expects to reduce approximately 30% Capital Expenditure (CAPEX) saving on site development and approximately 40% saving in Operational Expenditure (OPEX) compared to traditional RAN systems. As of March 2020, the network is in the test phase, with more than 25,000 active subscribers.

The inherent incentive of open vRAN is trying to unlock the value chain from the control of big vendors (e.g., Huawei, Ericsson, and Nokia), and also introduce more openness compared to the current established norm of proprietary software and hardware. By modularizing network functions and using Commercial Off-the-Shelf (COTs) products—including General Purpose Processors (GPP)— and opening up the transport interfaces, different software and hardware vendors will be able to collaborate with each other to build up a cost-effective and flexible RAN system. This will help establish a healthier ecosystem and provide Mobile Network Operators (MNOs) more space to drive innovative and customized services to end users. Rakuten Mobile follows the exact same rule and aims to build up a mobile platform to address the future needs of the telecom industry. It is thus natural that, like any new market development, the newly emerged open vRAN brings both a new set of challenges and many opportunities.

In the traditional telecoms supply chain, Ericsson has signed 81 commercial 5G agreements and 24 of these networks are live. Nokia announced that it has reached a total of 63 commercial 5G contracts worldwide. Huawei, despite being blocked from some major markets, has announced 91 contacts worldwide, more than half of which are in Europe. On the other hand, Rakuten Mobile just started the world’s first commercialized cloud-native network deployment, the current stage of implementation of which still focuses on 4G. Moreover, in contrast to the custom silicon typical in large vendor equipment, commoditized servers bring more flexibility and shorter time to the market, but will likely be more power hungry and need optimization to reach the performance levels of proprietary systems. Does this mean mobile operators should abandon the open vRAN approach and stick to traditional RAN systems?

Unlike some established MNOs, which have already deployed their 5G networks with big vendors’ equipment, Rakuten Mobile is still a greenfield player in telecoms. This leaves a great opportunity for it to develop something new from scratch. Moreover, even for established MNOs, remote and underdeveloped areas are all good places for them to extend their footprints with open vRAN, due to its fast and lower-cost deployment. Most importantly, under construction of the 3rd Generation Partnership Project (3GPP) Release 16, deployments in enterprise verticals will be a great opportunity for open vRAN to reach a critical mass. Following these scenarios, some key addressable features of open vRAN are detailed below:

• High data rate and dense cellular networks will create an increasing burden of managing the high number of Radio Remote Units (RRU) and Baseband Units (BBU). MNOs also need heavy investment in fronthaul links, which are used to connect radio and baseband units for data transmission. One of the key features of open vRAN is open fronthaul interfaces and virtualized baseband processing capabilities. With such specifications, MNOs can substantially decrease their CAPEX with dynamic baseband functional splits to fit various use cases. In addition, open vRAN can also bring intelligent software-defined network automation to reduce inefficient human interventions. Such features will need network functions to be modularized and interoperable.

• With these flexible RAN features, MNOs can follow Rakuten’s example and expand their business models by addressing different connectivity needs for different customers in an innovative manner (e.g., providing more dynamic and modularized services to meet enterprise customers’ different latency and reliability requirements). Moreover, MNOs can also use the open vRAN approach to build up a cost-effective private network and link it with their public network to extend coverage.

These are arguably long-term initiatives, but with the success of Rakuten-like commercial deployments, the entry of more software and hardware vendors to build a strong ecosystem, and the support from governments, MNOs will be more confident about speeding up open vRAN adoption.

Similar to the effects of the introduction of x86 processors and Microsoft Windows in the Information Technology (IT) domain, open vRAN will definitely lead to significant transformational changes in the telecoms value chain by introducing more flexible, cloud-native, and modularized architectures. On the other hand, to achieve these and unlock the full power of 5G, MNOs need to become more open and proactive in regard to embracing innovations, rather than relying on their trusted Tier 1 infrastructure vendors to provide all equipment and services. Moreover, as private network for enterprise application becomes more important and web giants like Amazon and Google enter the market through shared spectrum, MNOs should take more actions to fully play to the advantages of their existing expertise and assets before it is too late.

Rakuten Mobile is a very good example of putting real effort into embracing innovation by creating a cloud-native network from core to RAN, which will allow it to clearly understand what is mature, what should be developed, and in which direction to go in order to have success. Apart from that, the small vendors and MNOs should form an intensive collaboration environment to build a highly performed network. This will help them earn reputations from other players. Meanwhile, governments will also need to provide their support to small vendors/operators to help to build up a much wider and stronger ecosystem—e.g., reducing curtain among spectrum and tax fees. Although this transition takes time, in due time, cost and performance advantages will become a reality, and open vRAN will replace traditional RAN to provide better quality of experience.