The 5G Network Transformation Trap
5G is not just a revolution in terms of the services customers use. It also transforms the Operators technical platforms – bringing several technologies like SDN, Dark Fibre and Virtualisation into the mainstream.
The Mobile industry faces big changes with the introduction of 5G – and the diminishing status of earlier Gs – particularly 3G. Customer traffic continues to climb and there is more pressure to extend service into rural areas.
Mobile Aggregation is part of Core and Edge, which is a piece of Mentor’s 5G Technology Platform – and current market dynamics are turning it into a key battleground for UK Mobile Network Operators (MNO).
Get it right – and the CEO gets structural improvement in the cost of the network – and much more organisational freedom to rapidly provide new services.
Get it wrong. Not only will network costs grow faster than traffic – but new service introduction will hang around in the slow lane. Worse, network technology teams will be exhausted with fire-fighting – just to keep service levels competitive.
What are Aggregation and Edge networks?
Basically, Aggregation collects traffic from Mobile access and concentrates it onto bigger circuits heading for the Edge network nodes.
Its role is to terminate the numerous circuits from Mobile base stations. By simple multiplexing or switching, it then sends the traffic to the Core on much bigger, higher capacity circuits. These nodes don’t understand the traffic they are carrying – they don’t care.
But they do care that 1000s of circuits are shifting from 1Gb/s to 10Gb/s – from lit to dark – and from Openreach to Alt.net supply. Aggregation solutions must accommodate this massive shift – in terms of ports, locations and backbone capacity.
The crucial thing about an Aggregation network is its ‘reach.’ If it has too few nodes, the cost of the longer access circuits will be disastrously expensive – and new Dark Fibre options might be ruled out, simply by transmission length limits.
Creating the capacity and flexibility to deliver the traffic
Today, the leading Aggregation networks have well over 1000 nodes. Having achieved benchmark reach, the next challenge is to create the capacity and flexibility to deliver the traffic to new Mobile Edge nodes.
Edge Nodes are new ‘secure’ traffic break-out points. These nodes are located between the Operator’s network and the Internet at large. As you can imagine, their location is critical for high bandwidth services – like Netflix and BBC iPlayer – and the need to be close to Edge Computing servers. This is vital for low latency applications – like autonomous vehicles, virtual reality and on-line gaming.
Edge Nodes undertake the traffic processing functions for the mobile packet core (5G UPF / 4G PGW / 2G-3G GGSN). The UK’s national Mobile networks will need between 10-20 of these nodes to make sure they can compete on service.
Operators should ‘control’ these Edge Nodes – but they can choose to build, buy or partner to get hold of their Aggregation networks.
Today, each MNO has chosen a different solution for Aggregation.
Choosing the right Aggregation solution
Since Vodafone acquired Cable and Wireless in 2012, it has had a large-scale multi-service aggregation network, with over 1000 nodes. We imagine Vodafone will continue to extend this – where it makes commercial sense – based on their growing business.
Like it or not, EE is going to use the BT multi-service aggregation network which also has well over 1000 nodes. It’s probably the largest in the UK today.
Both Three and O2 have intriguing options and the ability to achieve competitive advantage – either from a technology leapfrog or, more likely, a fantastic financial deal. But, for now, Three seems to be working with SSE, though we wonder if that approach will get them anywhere near the 1000 node benchmark.
O2 is still with BT Wholesale – but they clearly have options for now.
A Renting or Partnering approach, rather than self-build
Everyone knows that networks need to be “full” to achieve the best unit costs. It’s doubtful that a standalone MNO has the scale required to achieve both the network reach and the network fill. A large empty network will sink a business – just as much as a small one would – without enough reach. This points to a renting or partnering approach, rather than self-build, at least for O2 and Three.
MNOs need to move with speed and precision to agree their Edge Node plans and their Aggregation solutions. The big danger here is being incapable of coping with the sheer volume of traffic hotspots appearing across a network, in the interim. Any good transformation program can deal with the tactical hotspots en route; a bad one will be exhausted and distracted trying to solve them.
It’s important to get things right first time – to avoid wasteful fire-fighting.
Network changes are coming at us all, very fast. There is barely enough time to build this once – never mind the usual ‘three times’ – driven by false starts, changing priorities or unrealistic plans.
True optimisation must come from effectively managing the dynamics of a multi-year build program – delivering successive step changes in capacity and capability. But this must be primed by a clear picture of the various options and choices. It doesn’t make sense to dawdle over the perfect answer on Aggregation, Edge or any other individual component.
Given the massive time demands, the network exercise has to be done once – and must be executed impeccably.
This is an incredible challenge for the technology functions in every MNO. They are literally creaking at the seams with “transformation fatigue.” It’s a really tough place to be.
At Mentor, we have stockpiled a ton of unique insights into this market, coupled with ‘heavyweight’ program management expertise. We can help Operators to develop rock-solid execution plans – to make sure these complex program deliver the ‘must-have’ results.