Of the major RAN vendors, Nokia and Samsung have been most active in embracing the open RAN movement, while Ericsson, Huawei and ZTE have stayed aloof. Now, Nokia is clearly gearing up for the big gamble – help break down the traditional locked-down supply chain on which it has made its fortune, in the hope of emerging as the dominant mobile vendor in a more open environment, at the expense both of its traditional competitors, and its new start-up challengers.
Ericsson has joined the O-RAN Alliance but not otherwise shown much public support. The Chinese vendors are not given to open initiatives, although they do contribute significantly to standards and even some open source developments. Their absence has made it easier for O-RAN to be co-opted by certain stakeholders in the USA as a politically motivated bid to exclude China from the 5G supply chain.
This is a significant reinterpretation of the original remit, which was to create a more open platform in which vendors of all sizes (and from any country) could participate because their offerings would be open and interoperable. Now, especially with the formation of the OpenRAN Policy Coalition, the new political angle has become overt. The Coalition aims to influence US policy in favor of mandating O-RAN and, implicitly, supporting US vendors above others.
That could benefit independent US vendors like Parallel Wireless, Altiostar, Mavenir, JMA and Airspan, either by making it easier for them to be part of large contracts, or by making them attractive to acquirers (Cisco will almost certainly be looking for a RAN asset, and Nokia or Ericsson might see value in owning a US company, in the current climate).
However, huge as it is, the USA is only one market and though Dish is committed to O-RAN, and a US-centric supply chain, for its upcoming 5G build-out, it is unclear how large-scale that will be, if it succeeds in finding a network partner. And the established MNOs have, so far, worked mainly with traditional vendors. So it will be a bad thing for the cause of open global platforms if O-RAN becomes too US-focused, but also for those new suppliers, which need to be able to sell in every market, not just those closely allied to their home country.
In fact, before the OpenRAN Policy Coalition was formed, much of the practical work of turning open networks into reality was coming from Japan and Europe – the former with Rakuten’s and Docomo’s deployments; the latter with Vodafone, Telefónica and Deutsche Telekom, among others, making big commitments to O-RAN implementations.
With Ericsson and the Chinese vendors on the sidelines, that opened up a big opportunity for Nokia and Samsung, which could hope that, while the giant operators would use start-ups for trials, small cells or rural expansion, in their central networks they would still want the reassurance of large suppliers with decades of R&D and large engineering resources behind them. They might demand lower prices, and that open interface boxes were ticked, but in the end they would play it safe with their prime contractors.
This is why Nokia has embraced O-RAN and its allied initiative, Telecom Infra Project (TIP), so eagerly, despite the ‘turkeys voting for Christmas’ element. In the O-RAN Alliance, it is co-chairing the workgroups that are defining the Open Fronthaul Interface and the Near Real-time RAN Intelligent Controller (RIC).
Samsung has little to lose, given its small role in the RAN before 5G, but Nokia is challenging a business model that has served it well – locking operators in with semi-proprietary implementations of standards; making it cheaper and less risky for MNOs to adopt an end-to-end solution.
In the early days of 5G, though, Nokia has faltered in the RAN, partly because of the huge scale of its two main rivals, and partly because of its own mistakes, particularly its choice of an expensive base station chip architecture which it was forced to abandon last year. So the rising momentum behind O-RAN gives it the chance to reverse its market share slide, by offering operators the perfect combination of fully open networks, delivered by an experienced and large-scale vendor.
Nokia was the first large vendor to join the O-RAN Alliance and has worked with some early adopters like Rakuten. Now it has joined the OpenRAN Policy Coalition alongside several of the US-based RAN challengers which hope to leverage open platforms to gain market share.
According to Brian Hendricks, VP of government relations for Nokia America: “Nokia believes that policymakers, operators and equipment providers should work together to support research and development of emerging network technologies that include open systems, advanced 5G technologies and foundational 6G research, with policies that support a robust ecosystem of trusted suppliers that will create a strong US position in secure wireless technology.”
But in other comments, he was less focused on the US element of that official statement, and said that one goal in joining is to ensure that the O-RAN cause does not get completely associated, in policy makers’ minds, with enabling new suppliers, or with US suppliers only. Despite the US Attorney General’s suggestion that the Trump government might take a stake in Nokia as a counterweight to Huawei, the supplier remains resolutely Finnish, and international in outlook – and despite recent setbacks, will not have given up on getting sales in China in future. Hendricks made the point that politicians may not always understand that just because networks are virtualized, it does not necessarily make them open; and that ‘legacy’ vendors can also support open platforms.
“We don’t see this movement [O-RAN] as a binary choice between doing short term things to support your existing suppliers and betting on an entirely new generation of technology players,” said Hendricks. “We can get in and have this unified ecosystem around key principles. We think it will actually help policy makers feel more comfortable moving forward on concrete proposals without feeling like they’re picking sides.”
All this is part of a bid to shape the O-RAN movement in a way that helps Nokia establish a strong position, which partly means moderating Coalition so that it does not become purely an America-first organization, which could jeopardize the opportunity for Nokia, and O-RAN more broadly, in some other markets.
It is a high risk strategy. Yes, it will be easier for an MNO to swap out those Nokia base stations; or to mingle two sets of virtual network functions on a single piece of infrastructure; or to introduce a second source of radios (as Rakuten did when it brought NEC into its RAN alongside Nokia); or to opt for a third party core or orchestration layer. But on the other hand, Nokia has early mover advantage over Ericsson and Huawei in O-RAN, in a way that it does not in conventional 5G; and it will be easier for it to replace those vendors and seize market share too.
A few tactics, well executed, could revive Nokia’s RAN fortunes on the back of open networks:
- Press home the advantage of moving quickly in O-RAN before Ericsson changes course, in order to build up an installed base and raise barriers against its rivals
- Emphasize its experience and engineering resources to persuade operators not to take the risk of introducing small vendors, at least in key elements like the 5G radio/antenna
- Take advantage of the political climate – supporting the Coalition, focusing efforts on markets where there are barriers against Huawei – but not to the extent of alienating regulators and operators which are not aligned to the Trump government agenda. Use its leadership position in O-RAN to continue to position this as a global initiative not an America-first, or even anti-Chinese, one.
And Nokia could drive home its advantage further by establishing control of some of the most important elements in the O-RAN architecture. If it can dominate the orchestration or even the RAN Intelligent Controller (RIC), it will be enabling the most important elements of the new operator model, such as slicing, advanced quality of experience optimization and dynamic enterprise network-as-a-service. These are the sort of offerings which will greatly enhance the 5G revenue model. Nokia has already made a play to lead in developing these platforms with its cloud packet core and private networking services for enterprises. If it can be the go-to vendor for RIC and orchestration, it can both help operators transform their services, and/or develop its own managed offerings for service providers and enterprises.
It needs to do this in order to keep its traditional rivals, including Cisco, as well as the webscalers, from seizing control of these controlling platforms instead. And it will also make it less serious if challengers start to gain market share in the vRAN software or radios. These will always have significant value, and cannot be commoditized to the extent of some other network elements, because of the RAN’s complexity and performance demands. But Nokia could afford to share some of the spoils, if operators really do insist on a fully multivendor network on the lines of Rakuten’s, as long as it can keep hold of the elements that hold the highest value for operators and enterprises.
The RIC is the best example of how Nokia is trying to establish power in key elements. Although the seed code for the O-RAN RIC came from AT&T, and there have been contributions from many players, Nokia has provided the bulk of the recent work to turn the controller into a fully commercial offering. It co-chairs the O-RAN RIC working group.
The RIC is strategic because it supports an O-RAN which can be deployed in a very distributed way on an edge cloud, enabling very low latencies and a host of new use cases. Whereas the O-RAN Alliance initially focused mainly on fully open alternatives to existing interfaces such as CPRI and X2, with RIC it has contributed something unique to the potential 5G architecture.
It comes in non-real time and near-real time variants, but the latter is the disruptive one, and provides a different approach from conventional RAN controller platforms. The RIC sits above the virtualized RAN’s distributed units, though it may be collocated on the same edge cloud infrastructure, currently focused on the Linux Foundation’s Akraino edge stack. It sits below the OSS/orchestration layer, and the O-RAN Alliance is defining various interfaces so that it can gather information from the RAN and from the OSS to inform its decisions – critically, the E2 interface to the radio information database; and the O1 interface to the centralized and distributed vRAN units.
The RIC is based on an extensible real-time microservices framework, and provides near-real time control and optimization of radio resources with functions including mobility management, spectrum management, load balancing, radio resource control and RAN slicing.
When its near-real time decisions are assisted by machine learning, it has the potential to support fully automated optimization even to the level of adjusting QoE for every single user on the fly. It could then support proactive optimization by predicting the network condition and UE performance; and since it controls the key element of the RAN’s ‘brain’, the scheduler, it can assign one scheduler per user group, application or even subscriber to support RAN-level slicing.
Ericsson stays clear of the OpenRAN Policy Coalition:
Ericsson has not yet shown wholehearted support for O-RAN and may be hoping to preserve the old models, at least for a while longer, if it can take advantage of Nokia’s recent setbacks and the sanctions against Huawei.
And it is certainly not supporting the idea that western governments might support particular vendors or platforms. In comments to FierceWireless, it made its position on the OpenRAN Policy Coalition, very clear, arguing that openness and fair competition should be based primarily on 3GPP standards rather than anything driven by a single country.
It claimed to believe in open systems, but said “this evolution needs to be based on open standards and the strong foundation build by 3GPP … We believe in open and fair competition. To stay ahead in the 5G race the US and other governments should maintain its market-based approach through technology agnostic policies. The focus of policy makers needs to be on speeding up 5G deployment through spectrum allocation and removing network deployment barriers.”