LightTrends Newsletter

LightCounting releases its Virtual and Open Radio Access Network Report Update.

In 2021, Japan, the world’s first open RAN and open vRAN nation proved the skeptics were wrong and pushed the detractors to retrenchment: NTT DOCOMO is in the Brownfield driver’s seat while Rakuten Mobile leads the Greenfield league. This would have never been possible without the combination of the launch of the Telecom Infra Project (TIP) in 2016, the launch of the O-RAN Alliance in 2018, and the relentless U.S.-led 2018-2020 effort to convince dozens of nations including its allies to ban Chinese vendors from their 5G rollouts. As a result, the world has changed in a dramatic fashion:

1. The Chinese vendors are effectively either banned or avoided.
2. The international cooperation and national and regional initiatives focused on open RAN and 6G to effectively compete against China is unprecedented.
3. These 2 developments along with TIP, the O-RAN Alliance and the Open RAN Policy Coalition drove the creation of a comprehensive open RAN ecosystem composed of more than 60 vendors spanning the whole supply chain from chipset to hardware and software.
4. 5G rollouts, which are occurring faster than previous 4G rollouts are closing the open RAN window of opportunity during this first cycle which is ending this year, which in turn evokes the Stigler survivorship principle: in this mushrooming open RAN ecosystem, not every player will survive, and consolidation is inevitable. A looming recession expected to materialize within the next 12 months may accelerate the consolidation.

“We maintain our view that the effect of the Stigler principle is already in the making and the weakest players of the expansive open RAN ecosystem will either disappear or be acquired. Nonetheless, the open RAN market is unstoppable, looking up, and poised to rule the world and ruin the RAN establishment. Patience is needed as we expect the global switch to open vRAN to occur in the 2024-2025 timeframe, driven by large Tier 1 CSPs around the world.” said Stéphane Téral, Chief Analyst at LightCounting Market Research.

Consequently, we expect the open vRAN market to grow 80% this year: our updated forecast is 58% higher than last year’s forecast. We forecast the open vRAN market to account for 12.6% of the total global RAN sales in 2027 up from 3.7% in 2022. Note that had the geopolitical developments not been that significant, the penetration would have been higher because 5G rollouts would also have been more gradual.

Finally, we believe open RAN is a serious contender for indoor use cases in general and open vRAN as a DAS replacement in particular because it offers the same benefits as DAS has been known for, but with greater flexibility and cost efficiencies. Open vRAN penetration in the indoor DAS segment will also lead to the enterprise private wireless network space that is currently dominated by traditional RAN implementations.

About the report:

This report takes a deep dive into the virtualization and disaggregation of radio access networks and analyzes the various schools of thoughts ranging from basic virtualization of RAN functions (vRAN) to new open architectures such as open RAN, following the TIP initiative and the O-RAN Alliance specifications, designed to cut the dependency on proprietary RAN equipment supplied by the traditional vendors. The vRAN segment is taken from our existing RAN size and forecasts and broken down by 2G/3G/4G versus 5G, as well as by vCU/vDU and RU for each region, and also looks at the potential for indoor DAS replacement. The report covers a wide emerging ecosystem of vendors.