by Rob Hughes
Open RAN is a hot topic in the wireless business—with good reason. Assuming its current trials convert to commercial deployments, industry analyst iGR estimates that by 2025, Open RAN will be introduced into networks operated by MNOs that, collectively, serve 52.5% of the global wireless subscriber base.
At the same time, large incumbent RAN vendors, hoping to preserve their oligopoly, are trying to assure prospective customers that Virtual RAN (vRAN, also known as Cloud RAN) offers most of the benefits of O-RAN, including virtualization, with minimal need for integration. To a limited extent, they are correct. But Open RAN has much more to offer than vRAN. To understand why, it’s necessary to look beyond the similarities and consider how the two architectures differ from each other.
Open RAN and vRAN Both enable Cost Savings by Using Generic Hardware
Let’s start with the most important similarities. Both Open RAN and vRAN offer a significant benefit by separating RAN hardware from software. Consequently, software for the virtualized Centralized Units and Distributed Units (vCU/DUs) can run on any Commercial Off-The-Shelf (COTS) hardware. This support for commodity hardware enables operators to reduce capital costs by taking advantage of the economies of scale afforded by COTS and web-scale General Purpose Processors (GPP). Accenture has said that 5G deployments that use COTS hardware and Open RAN software realized capex savings of 49% compared to traditional deployment options.1
Open RAN and vRAN Both Offer High Scalability
Avoiding proprietary RAN hardware also enables operators or enterprises to right-size their RAN to match their need. For example, private 5G networks or smaller rural locations may not require as much compute and may be able to reduce costs simply because they can buy only what they need and avoid paying for unused capacity.
Proprietary Network Interfaces Put vRAN at a Disadvantage
The primary drawback of vRAN is that it uses proprietary interfaces between radios and other network elements, thereby locking the operator in to a single RAN vendor. By definition, Open RAN opens the software interfaces to other network elements, giving the operator the freedom to combine RAN gear from multiple vendors. For example, the best vDU/CU software solution may be different than the best radio hardware.
Savings through Increased Competition
A primary advantage of Open RAN is the flexibility to change vendors at any time. Many incumbent vendors charge annual right-to-use fees and/or capacity licenses. These pricing mechanisms are designed to make the initial price appear low, but they actually increase Total Cost of Ownership (TCO). Ensuring that operators always have the flexibility to change vendors discourages predatory pricing schemes and increases TCO transparency.
Moreover, freedom to select from multiple vendors means greater leverage when negotiating with incumbent vendors. In fact, introducing a second vendor reduces the total cost of ownership by 15%-25% over five years, in most cases2.
Lower Entry Barriers Stimulate Innovation by enabling new Entrants
Open interfaces allow new vendors to specialize on fewer network elements, which reduces their upfront capital and resource requirements for developing a complete end-to-end proprietary network solution. Making it worthwhile for new vendors to enter the market not only results in more choice and novel solutions, it also puts pressure on incumbents to innovate more to remain competitive.
Faster Innovation and Superior Performance with RAN Intelligent Control
Open RAN introduces important new RAN network functionality: RAN Intelligent Control (RIC). RIC enables vendors to develop and quickly introduce apps to improve mobility and interference management, as well as admission control. RIC’s advanced functionality delivers increased efficiency and superior radio resource management. This functionality can be further enhanced by combining it with artificial intelligence. By opening RIC to third-party developers, operators can introduce innovations more quickly without having to wait for an incumbent vendor to deliver a whole new release.
O-RAN enhances existing virtual RAN capabilities by standardizing Control capabilities in conjunction with the Data Inputs through the RIC infrastructure (e.g. the R1 Interface in the Non-RT RIC.) This allows for effective, and multi-vendor, applications to have a material impact on the functionality of the network. In an O-RAN environment, a RIC application may be developed to perform analytics on both legacy LTE and O-RAN 5G portions of the network, using 3GPP to O-RAN mediation of the LTE telemetry. Because O-RAN standard interfaces allow RIC applications to control network functions, the RIC application may respond to legacy network deficiencies by dynamically adjusting the 5G service coverage, capacity, etc. Applications need only be developed a single time for multiple vendors in an O-RAN network.
Greater Flexibility with Niche Radios
Incumbent RAN vendors often brag about the extent of their radio portfolios. But, often the radios selected for development are limited to those with mass-market appeal. Frequently, operators encounter situations where they need radios for niche applications. For example, they may need multi-band radios in an unusual frequency combination; or very small indoor radios; or radios for enterprise verticals with specific environmental requirements; or radios with less common backhaul requirements like hybrid-fiber coax.
With Open RAN, it’s easier for vendors to specialize and offer superior products targeted at highly specific needs or smaller markets. Thus, a larger number of specialty vendors can develop radios for niche applications that can be deployed in any operator’s network regardless of which vendors have been used for everything else.
Improved Supply Chain Reliability
Global supply chains are stressed and unpredictable, in some cases to breaking point. A stressed supply chain causes delays that slow down deployment and limit network capacity, eroding customer satisfaction. Inability to meet subscriber demand inevitably means less revenue. Operators are rightly jittery about the reliability and timeliness of their supply deliveries. Deploying Open RAN mitigates this risk by providing alternatives when a supplier falls short of demand, because its openness facilitates access to multiple options from diverse suppliers.
Summary
vRAN certainly offers some degree of CAPEX savings and improved scalability through the use of COTS hardware with general-purpose processors. Unfortunately, that’s where the benefits stop. O-RAN, by contrast, offers the same benefits, but it goes a lot further. Check out the table below for a summary of how the two architectures compare side-by-side. You can also view more detailed information about Open RAN on the Fujitsu website.
| Benefit | Virtualized RAN | Open RAN |
|---|---|---|
| Cost Savings by Using Generic Hardware | Yes | Yes |
| High Scalability | Yes | Yes |
| Open Interfaces between DU and RU | Yes | |
| Savings through Increased Competition | Yes | |
| Lower Entry Barriers Stimulate Innovation | Yes | |
| RAN Intelligent Control | Yes | |
| Support for Niche Radios | Yes | |
| Increased Supply Chain Reliability | Yes | |
| Standardized Multivendor Artificial Intelligence and Automation | Yes |
