ITEM: Mobile operators are dramatically scaling back plans to invest in advanced network automation technology, which could delay 5G rollouts over the next few years, according to a new report from Rethink Technology Research.
Network automation isn’t a new concept – the mobile sector has been talking about it for years. Indeed, way back in 2008, one of the hot new tech features of 3GPP Release 8 (the first iteration of LTE) was SON (self-organizing network), an automation technology designed to simplify planning, configuration, management and optimization of LTE rollouts. It could also be retrofitted to support UMTS.
However, operators have been slow to automate their RANs (as well as their core and transport networks) over the years for a variery of reasons, a key one being that while network automation technologies promised lower opex, the savings weren’t so dramatic as to make it a top priority.
According to the new Rethink report [PDF], the onset of 5G changes all that, because 5G is a more complex beast, with higher cell densification, more complex antenna arrays (think massive MIMO and beamforming) and network virtualization. Put simply, writes Caroline Gabriel, research director and co-founder of Rethink Technology Research and author of the report, automation technologies like SON and machine learning are not optional for 5G networks – they’re the key to making 5G work:
These trends introduce a huge number of new components – from thousands of physical small cell sites to hundreds of dynamically provisioned virtual network functions (VNFs), to millions of connected devices – into the network. This means modern networks are becoming hard for humans to understand, predict or manage.
RAN and transport automation not only makes 5G networks easier to roll out and run, it also promises to bring opex down significantly – as much as 11% in the first five years of rollout schedules (compared to just 3% in the first five years of 4G rollouts).
Yet the Rethink report – which canvassed 83 Tier 1/Tier 2 MNOs worldwide planning to deploy 5G commercially by 2024 – found that operators are now scaling back their original automation targets, with full automation now unlikely to happen for many operators until the mid-2020s:
Globally, only 18% expect to have more than 40% of functions automated by the end of this year.
Last year 21% of the same operators said they would have more than 60% of processes automated by the end of 2020. Those hitting this 60% mark fell to 14% in this year’s study, suggesting respondents had been over-optimistic previously or that projects are snagged, or harder than they seemed.
Rethink expects that to have a knock-on effect on 5G rollouts, because without network automation, the business case for rolling out 5G in the first place essentially falls apart.
Previous Rethink reports have shown that initial 5G rollout costs will be pricey until open RAN goes commercial and breaks the vendor oligopoly currently dominating the cellular market. Meanwhile, new revenue streams beyond the “like 4G, but faster” business model won’t kick in for at least a few years.
The fallback justification for 5G rollouts has been that the opex savings alone will make it worth the upgrade, even if the new revenue streams take time to develop – but according to Rethink’s analysis, without sufficient automation in place, even the opex savings won’t amount to much.
As for why operators are scaling back their automation targets despite the obvious incentives, Gabriel writes that this is partly “a natural dose of realism that creeps in when the deadline draws near”:
Automation will be a gradual process for most operators and that is often the best approach, provided each stage delivers benefits and is related both to short term economic goals and to future strategy.
The danger is that operators might play it too cautious. If the goal is to have at least 80% of physical network processes and VNFs automated to facilitate a successful 5G rollout (as some early movers have said), operators need to get started as soon as possible, Rethink says. If they go too slow and/or fail to plan effectively, then their 5G rollout might well be a financial disaster.
You can read the executive summary here.