ran investment growth will rely on alternative deployers · strategy at a network providers, their...

R E T H I N K T E C H N O L O G Y R E S E A R C H RAN RESEARCH: THE RESEARCH ARM OF

WIRELESS WATCH

Lead analyst: Caroline Gabriel

RAN investment growth will rely on alternative deployers

Deployment of base stations by new and alternative cellular operators 2019-2025

“R e t h i n k h a s a c o m mi t m e n t t o f o r e c a s t i n g m a r k e t s t h a t o t h e r s s h y aw a y f r o m – t h o s e o n t h e v e r g e o f r a d i c a l t r a n s f o r ma t i o n ”

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Companies mentioned: Altice USA, AT&T, Bosch, Charter, Com-cast, Crown Castle, DenseAIR, Digital Colony, Dish Network, Free mobile, Iliad, iWireless, SK Telekom, Rakuten, Reliance Jio, Zayo

Executive Summary


Copyright © 2020 Rethink Research, All rights reserved.

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CONTENTS

Page

Contents 2

Table of Figures 3

Introduction 4

Operator proliferation reverses a decade-long trend of consolidation 8

New entrants and new spectrum policy drive diversity in macro and

micro networks 12

New macro networks are not just displaced investment - new providers

add incremental spend 13

Outdoor and indoor localized networks will be the main engine of new

operating models 14

Alternative operators will finally kickstart capex spending on small cells 18

Open RAN architectures and shared spectrum will be key drivers of new

deployment models 19

Conclusion 21

Methodology 23

The Rethink RAN Research process summarized 24

RAN Research: Forecasting disruption in wireless 25

Contacts 26

About rethink Technology Research 27


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TABLE OF FIGURES

Page

Figure 1.Total RAN and core equipment capex spend by traditional

and alternative operators 2019 to 2025 (Table 15) 10

Figure 2. Deployments of macro and micro base stations by new or

alternative operators, by operator type 2019 to 2025 (Table 3). 11

Figure 3. Deployments and upgrades of macro and micro base stations

by region 2019 to 2025 (Table 1) 12

Figure 4. Deployments of macro and micro base stations by new or alternative

operators 2019 to 2025 (Table 2) 13

Figure 5. Macro and micro base station equipment capex spending by region

2019 to 2025 (Table 7) 13

Figure 6. Macro and micro base station equipment capex spending by new

or alternative operators 2019 to 2025 (Table 8) 14

Figure 7. Deployments and upgrades of mini-macro base stations by region

2019 to 2025 (Table 4) 16

Figure 8. Deployments and upgrades of mini-macro base stations by new or

alternative operators 2019 to 2025 (Table 5) 16

Figure 9. Deployments and upgrades of indoor and low power small cells

2019 to 2025 (Table 9) 17

Figure 10. Deployments of indoor small cells by new or alternative operators,

by region 2019 to 2025 (Table 10) 17

Figure 11. Indoor small cell and outdoor mini-macro equipment capex

spending by region 2019 to 2025 (Table 13) 18

Figure 12. Indoor small cell and outdoor mini-macro equipment capex

spending by new or alternative operators, by region 2019 to 2025 (Table 14) 18

Figure 13. Deployment of indoor and outdoor small cells based on open RAN

architectures, by operator type 2020 to 2025 (Table 12) 20


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A critical difference between mobile network deployments in the 5G

era, and those in preceding generations, will be the diversity of organi-

zations building, managing and monetizing them. For the first time, in

the 5G era, major deployments of cellular networks will be made by non

-MNOs. By 2025, although traditional operators will still dominate

capex spending on wide area macro networks, almost one-third of

capex budget on greenfield, localized and indoor networks will be spent

by new entrants.

For vendors, this will be a welcome mitigation of general decline in

capex spending on RANs, caused by consolidation of mobile network

operators (MNOs), a shift to software-centric and open platforms with

lower upfront costs, and a higher degree of network sharing and of as-

set reuse. In the macro network, overall equipment investments will fall

by a compound annual growth rate (CAGR) of –X% between 2019 and

2025, but spending by alternative deploy-

ers, though less than X% of the global to-

tal, will rise at a similar rate.

In small and mini-macro cells (outdoor,

macro-equivalent base stations mounted

on street furniture or walls), the picture

will be far more dramatic. By 2025, alterna-

tive deployers will account for one-third of

equipment spending and their investment

will have grown at a CAGR of XX% in the

same period, compared to XX% for the

market as a whole.

The drivers for the deployment of new networks by non-traditional op-

erators are complex, but most relate to the fact that 5G is designed to

support a wide range of use cases and business models, well beyond the

generic mobile broadband and voice services of 3G and 4G, which

formed the core of the MNO business case and were almost entirely

supported and monetized by that group.

Introduction


5

The concentration of deployment in the hands of the MNOs was con-

firmed by spectrum policy – cellular spectrum, until the very recent ad-

vent of unlicensed versions of LTE, has been allocated exclusively, and

usually nationally, to traditional operators. New entrants have been

scarce because of the investment required to buy national, long term

spectrum licences, especially in auction situations where governments

have often been motivated by the lure of new revenues for the treasury,

rather than by a desire to boost competition (see Rethink RAN’s report

on shared spectrum for more analysis).

Deployment by non-MNOs, and in open spectrum, has largely been con-

fined to WiFi, and in the enterprise and city environments, the patterns

set by WLAN deployers will be very influential on cellular roll-outs in

the 5G era (which will not be entirely 5G technology – many of the net-

works we will discuss will, initially at least, focus on 4G, because of its

relatively low cost and high availability in the early years, and because

of its variants for shared spectrum and for low power IoT network).

This has seen many enterprise wireless use cases supported by WiFi ra-

ther than cellular, especially indoors, because MNOs have found it diffi-

cult to make a strong case for investing in these networks, while indus-

tries have often been unwilling to pay extra for good indoor coverage.

That is changing now, as many enterprise and urban applications are

emerging which would work optimally on cellular networks, or a com-

bination of WiFi and cellular, rather than WiFi alone. Mobile connectivi-

ty is becoming business critical, and so the willingness to invest in it is

rising. And many types of organization are seeing a business case for

meeting these enterprise and municipal demands, even where an MNO

does not.

In the current 4G era, the MNOs have discussed openly how most of

them find it hard to make a strong business case for enterprise and city

services. Certainly, they would require new areas of investment – deep

indoor penetration being a good example – which would not obviously

be justified by significant additional revenues.

In 5G this misalignment of MNO deployment models with the needs of

enterprise sectors risks derailing some of the grand 5G and industrial

strategy visions which many governments have set out, and which has


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driven their support for 5G testbeds and trials. It certainly risks disap-

pointing the expectations of many industries, as well as sectors like edu-

cation, which are interested in what high quality optimized connectivity

(not necessarily 5G of course) could do to enhance their processes.

Some MNOs are addressing the challenge, but they are often advanced

players like SK Telecom or AT&T, which are developing full digital

platforms, virtualizing their networks and moving towards network

slicing. They can therefore support many sectors and services, on an in-

creasingly optimized and on-demand basis, without having to worry

about a single industry delivering a massive revenue hike. Instead, each

new service, cost-effectively deployed by the new automated platform,

will deliver incremental new revenue that adds up to a significant boost

to the overall business.

Most MNOs, however, are thinking about this approach in terms of a

decade-long evolution – if at all. For many, especially in emerging mar-

kets where there is still plenty of growth in consumer mobile usage,

there is no need to look beyond more cost-effective ways to hike capaci-

ty and support enhanced mobile broadband at scale. So the gaps must

be filled, and the upside is that the demands for new services at afforda-

ble prices – from enterprise and from some consumer groups – will

drive the industry to a more rich and varied set of service providers.

Regulators and governments will encourage new operators to ensure

their visions stand a chance of being delivered, and if the existing telcos

do not accelerate the progress towards flexible, wholesale platforms,

which can support a huge range of enterprise MVNOs cost-effectively,

then others will step in. Germany, The Netherlands, Ireland and other

countries have awarded spectrum specifically for industrial networks,

and the UK is considering an approach to offer some airwaves on a very

local or flexible basis, to encourage small operators, as well as more

sharing. The global template for shared spectrum access is currently the

USA’s CBRS band in X.X GHz, which takes a multi-tiered approach in-

cluding relatively low cost licences plus a shared access level, which

provides greater protection from interference than fully unlicensed

bands like X.X GHz, thanks to a novel Spectrum Access System (SAS)

administered by licensed providers.


7

Methodology

This document contains explanatory notes and commentary to accom-

pany the Excel spreadsheet ‘Rethink RAN Service Alternative Deploy-

ers Module 2019-2025’. That contains further data breakdowns includ-

ing regional patterns. The surveys and forecasts on which the outputs

are based were conducted in July to November 2019.

There were 78 responses from Tier 1 and Tier 2 mobile operating com-

panies worldwide and 28 from alternative deployers including private

network operators, neutral hosts, enterprise integrators and cable pro-

viders. The sample was restricted to operators with plans to deploy 4G

and/or 5G commercially between 2019 and 2025. The commentary re-

fers only to a selected number of the 15 data tables included in the Excel

data module. Additional tables are included in the spreadsheet with ad-

ditional regional and other breakdowns.

The report analyzes the deployment trends, timelines and budgets for

cellular macro, micro and small cell networks as reflected by this sam-

ple of operators, and those surveys, plus a series of in-depth interviews,

are central inputs to the resulting forecast of activity and spending to

2025. This research was complemented by interviews with selected ven-

dors, standards and open source organizations, and by an overview of

R&D efforts in this field.

Note: For each figure, a table number is given, which relates to the posi-

tion of the data table in the Excel file.


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This report is critical to anyone involved in preparing a business plan to

enter the 5G space, whether that’s putting themselves up against exist-

ing MNOs navigating new individual services for an MNO. It will help

vendors plan their most effective sales strategy in 5G, and help opera-

tors control their costs. As such this report is for anyone involved in

strategy at a network providers, their technology partners, implement-

ers, equipment suppliers, software providers and investors, at C Suite

level down to product marketing and product planning. The RAN Re-

search arm of Rethink Technology Research is essential reading for any-

one who wants to stay on top of current trends and thinking among

MNOs. It’s like being a fly on the wall in their planning meetings and is

based on questions MNOs have answered about their planned and fu-

ture expenditure.

This report will;

· Give you a spreadsheet you can drop directly your planning

· Understand the future landscape of increased 5G competition, taking

in new entrants.

· Help you build a go to market plan for a new 5G service.

Pricing

Each module of RAN Research costs $2,000 for a single, individual li-

cense, and $4,000 for a corporate license for any individual report such

as this one. This is the price for ‘RAN investment growth will rely on

alternative deployers’ and for any previous reports. The entire service

can also be purchased as a subscription, which comes with 6 reports

each year. Ask for pricing details.

How Do I buy this report?

Please follow the link to our store or email [email protected]

This report has been compiled by our Head of Research, Caroline Ga-

briel who can also be emailed at [email protected]

Who should buy this report?

https://rethinkresearch.biz/store/

mailto:[email protected]



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These forecasts were based on a combination of data from:

• Detailed surveys, interviews and operator-by-operator modeling of

the IMG-40 groups.

• Studies and modelling of the deployments and strategies of the top

100 4G operators, as tracked by Rethink Technology Research’s quar-

terly surveys, interviews and desk research.

• A survey of 83 Tier 1 and Tier 2 mobile and converged operators

about their detailed plans for RAN deployments to 2025.

• Input from ecosystem vendors on shipments, technology strategies

and competitive landscape, also updated quarterly.

• Interviews with other stakeholders such as IoT services providers and

enterprises

• A calculation of the resources required in each type of location to

achieve the MNOs’ stated objectives.

Most of the forecasts refer specifically to nodes deployed within MNO

networks, either by themselves or by partners. MNOs may also make use

of third party nodes deployed outside their network and connected by

wireline or WiFi; and many edge cloud services will run on infrastructure

that is not used by MNOs at all.

The Rethink RAN Research process summarized


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Rethink Technology Research is a specialized research and consulting firm

with 12 years’ experience in surveying wireless, broadband, over-the-top

and quad play operators. This has resulted in a broad research base of over

140 service providers (MNOs, telcos, cable and satellite operators, over-the-

top providers) worldwide. These organizations are surveyed on a regular

basis about their network infrastructure and business plans, and have a re-

lationship of trust with Rethink.

Rethink also has deep relationships with the telecoms ecosystem (tier one

device OEMs, vendors, technology developers, integrators, regulators etc),

and is perceived as a thought leader in many areas of the telecoms and me-

dia sectors. Key areas of expertise and research experience include HetNet

migration, small cells and carrier WiFi; transformation strategies for the

RAN and the BSS/OSS; convergence of IT and network skills and platforms;

device and chipset roadmaps; spectrum strategy.

Here are some sample titles of reports we have produced recently:

• RAN automation is central to the 5G case—but is it a distant dream?

• Open RAN architecture set to disrupt 5G landscape

• Making the mobile enterprise a reality at last?

Single User license - $2,000 (One Report)

Single User subscription (This report plus 5 more) $6,000

Corporate license—$4,000 (unlimited distribution inside your

organization).

Corporate Subscription (This report plus 5 more) $10,000.

RAN Research: Forecasting disruption in wireless

SUBSCRIPTION COSTS


11

RETHINK LEADERSHIP

RAN RESEARCH MAIN CO NTRIBUTORS

Caroline Gabriel - Research Director

[email protected]

+44 (0)207 450 1230

Peter White - Co-founder and CEO

[email protected]

+44 (0)117 925 7019

Caroline Gabriel - Research Director and Co-founder

[email protected]

+44 (0)207 450 1230

www.rethinkresearch.biz



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Rethink is a thought leader in quadruple play and emerging wireless and

IoT technologies. It offers consulting, advisory services, research papers,

plus three weekly research services; Wireless Watch, a major influence

among wireless operators and equipment makers; Faultline, which tracks

disruption in the video ecosystem, and OTT video. Riot on enterprise dis-

ruption from the combination of AI/IoT and cloud.

About Rethink Technology Research

Need more information?

John Constant (Business Analyst)

[email protected]

O: +44 (0)1794 521411

M: +44 (0)7468 460739



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Published January 2020


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