5G needs to be profitable

A fundamental driver for the evolution to 5G is the gap that has developed between consumer data usage and revenue per user.

Guest author

May 11, 2018

4 Min Read
5G needs to be profitable

Telecoms.com periodically invites third parties to share their views on the industry’s most pressing issues. In this piece Ray Butler vice president of Wireless Network Engineering at CommScope, looks at how to prioritize your 5G investments.

A fundamental driver for the evolution to 5G is the gap that has developed between consumer data usage and revenue per user. That gap is widening, making wireless network operators’ profitability challenging to maintain while subscriber demand continues to soar. Lowering the cost per bit for delivering wireless service is a critical business objective for 5G. This can be achieved through efficiencies in convergence, Cloud-RAN and DC power options.

To achieve cost efficiencies in 5G while delivering a superior user experience, many operators are converging their wireline and wireless networks. Fiber optic cables provide the backbone that extends ever-closer to the end user. Traditionally, fixed and wireless networks evolved independently of each other. In 5G, a fiber-to-the-x (FTTx) network will connect small cell sites and/or deliver fixed wireless access across the same fiber cables. Operators need to maximize synergies wherever possible to decrease the delivery cost per bit.

Efficiency is a critical design requirement for all aspects of 5G throughout the converged network. This encompasses a variety of network technologies—from a spectrally efficient design of the air interface, to an implementation of a virtualized, load-balancing core; to small cells that can be cost-effectively sited and serviced with power and backhaul. The quality of the RF path is always mission critical in a wireless network because the level of noise and interference strongly determines the data throughput.  To this end, operators must focus on ensuring a clean RF path.

Passive optical components and wavelength division multiplexing (WDM) can have a significant impact on the efficiency of fiber fronthaul/backhaul networks. The incorporation of wavelength division multiplexers reduces the amount of fibers required in the network, leveraging the installed plant, and decreasing both the footprint and investment cost of network roll-outs.  WDM also protects current investments from future increasing bandwidth requirements.  In existing networks, these components allow capacity upgrades at a relatively low cost without additional construction works. Adding components that monitor the network without disturbing any other signals reduces operational expenses.

The road to 5G also involves the centralization of baseband processing, which provides operating expenditure and capital expenditure savings through pooling of available resources. The next step is virtualizing BBUs on commercial-off-the-shelf servers to evolve the network to true Cloud RAN (C-RAN). The C-RAN architecture will bring computing capabilities closer to the edge, which is necessary for low latency applications. Virtualization engenders optimization and provides capacity elasticity, greater efficiency and more throughput capacity. In addition to saving on hardware costs, the C-RAN model can create significant savings in terms of power, cooling and site leasing costs. In Asia (the first region to successfully deploy C-RAN commercially), China Mobile has seen 30-60 percent savings in total cost of ownership by deploying the C-RAN architecture.

Every edge device needs local power, which has traditionally involved AC power grid connections made by electrical contractors. Between labor availability and permitting hurdles, this can be a slow and expensive process, and provisioning conventional power may add as much as $15,000 to the cost of a single device connection. A smart alternative is distributed power connectivity that utilizes high-efficiency DC-DC conversion technologies, and which doesn’t require licensed electricians, thus streamlining the permitting process. This approach allows the centralization of power management and organization of central battery backups for a cluster of mission-critical edge devices, such as 5G small cells or fixed wireless radios.

Rising data demand will continue to pressure MNOs, and their balance sheets, for 4G and 5G. Network operators need solutions that evolve their LTE infrastructure for higher bandwidth, more efficiency, easier manageability and lower costs now and on the path to 5G. Network convergence, C-RAN and DC power delivery are some of the areas where cost-savings can be achieved. Of course, there are other opportunities and many more are likely to appear in this ever-changing landscape. As in all business scenarios, the total cost of ownership for new solutions needs to be considered.  And any network investments now need to have the 5G future readily in mind.


Ray-Butler-150x150.jpgRay Butler will be speaking on ‘LTE Advanced Pro: Massively Expanding Gigabit LTE Coverage’ on 16 May at 5G North America 2018 in Austin, Texas. Ray is vice president of Wireless Network Engineering at CommScope, responsible for wireless technical sales leadership in outdoor Radio Frequency (RF) products.  Previously, Ray led the Research & Development team responsible for base station antennas, filters, combiners, remote radio heads and RF power amplifiers. He also worked for Andrew Corporation as vice president of base station antennas engineering, and systems engineering and solutions marketing, respectively.

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