Bharti Airtel has tied up with TCS to build 5G networks based on open radio access network (O-RAN) technology. Reliance Jio too is also running trial runs of its O-RAN in several Indian cities.
In the early days at the beginning of the millennium, the telecom networks relied on proprietary technology controlled by Ericcson, Nokia, Alcatel, Lucent and Motorola. A telecom company used to buy the whole block from one player — both hardware and software.
With the advent of 4G, the telecom operators wanted more freedom of choice and high processing servers. They wanted to tap different vendors. They moved from proprietary to open software and hardware. The new players were HP, Dell, Cisco for hardware and Red Hat and IBM for software.
However, the RAN market still remained exclusively with the big players, and it accounted for 70-80 per cent of the network’s capital cost.
The 5G market of gear-makers consist of four players only — Ericcson, Nokia, Samsung and Huawei. The Chinese company faces restrictions. Samsung is a small player. Thus there is a duopoly of two firms — Ericcson and Nokia.
The aim of the companies is to reduce the capital investment. Besides, spectrum cost is high in India and accounts for 50 per cent of network cost.
O-RAN is thus a favoured solution. O-RAN’s international Alliance has over 150 players. It is based on open software. Various blocks of the network have been disaggregated. Telcos can use their discretion to buy software and hardware from different vendors. Yes, this necessitates a system integrator to harmonise the different blocks.
As the market is competitive, the savings on this account alone could account for 40 per cent. It is easier for telcos to provide add-on services and provide faster updates. But as the operating costs are higher, the savings could be neutralised. O-RAN still is unproven on 5G. Rautken in Japan is the first standalone O-RAN network. And the jury is still out on that.
The three building blocks of O-RAN are the radio unit (to receive and transmit the frequency signals, amplify then and digitise them), and two base band units — the central unit and the distributed unit. Here the data is processed and sent to the network. The central unit is located near the radio unit and can also be hosted on the cloud.
Reliance Jio proposes to use Google Cloud. TCS sells a state-of-the-art O-RAN and the 5G core. Bharti has tied up with TCS. Reliance Jio has designed the core. CDOT too has done so and is seeking customers. PertSol too is also in the field. HFCL and Sterlite are designing a radio. Reliance Jio would like to outsource the manufacturing.
TCS will be a system integrator for Bharti Airtel. Tech Mahindra is a system integrator for Rautken. It is ready to tie up with Reliance Jio.
If the system works in India, it will work anywhere. India has thus an edge over others.