The rapid rollout of 5G technology has marked a historic milestone in the evolution of mobile connectivity. According to research firm Omdia, 5G subscriptions surged from 1.4 billion in the middle of 2023 to a projected 8 billion by 2028, representing a compound annual growth rate (CAGR) of roughly 40%. Despite this impressive uptake, Omdia’s data also reveals that overall mobile revenue is growing at a modest rate of about 2%, and average revenue per user (ARPU) is experiencing a decline.
Wireless trends and opportunities
Communication service providers (CSPs) are responding by scaling their 5G networks to accommodate the soaring bandwidth demands, foster revenue growth, reduce total cost of ownership (TCO), and enhance network efficiency and agility.
The industry has seen significant investments from CSPs, with tens of billions of dollars spent on 5G spectrum and more on radio access network (RAN) infrastructure to support 5G. CSPs’ current focus is monetizing 5G for both consumer and enterprise services (see Figure 1).
Figure 1. Opportunities and Trends
On the consumer front, fixed wireless access (FWA) has emerged as a leading 5G application. For instance, in 2022, FWA accounted for 90% of net broadband additions in the U.S., surpassing traditional cable and DSL. However, this shift brings its own complexities, including the need for enhanced xHaul transport bandwidth, increased data center resources, and greater demand for spectrum resources.
For businesses, private wireless networks represent a crucial area of growth. These networks are particularly relevant in the manufacturing, transportation, logistics, energy, and mining sectors. The advent of 5G-Advanced technologies could help expand these opportunities further. Network slicing, introduced by the 3rd Generation Partnership Project (3GPP), will be pivotal in deploying private 5G networks and other differentiated services.
Partnerships are becoming increasingly important in network monetization strategies, especially with hyperscalers. Additionally, collaborations with satellite operators are gaining traction due to investment and dramatically reduced launch costs, enabling the deployment of low Earth orbit (LEO) constellations and satellite transition from proprietary silo towards integration with terrestrial and 5G networks. Driven by the need for comprehensive reachability and the development of standardized connectivity, as outlined in 3GPP Release 17, this collaboration allows mobile and fixed operators to expand coverage to remote locations and for satellite operators to tap into new customer bases.
Operators are also focusing on technical advancements to monetize their 5G networks effectively. This includes transitioning from non-standalone (NSA) to standalone (SA) mobile cores, which is essential for enabling advanced 5G capabilities. 5G SA cores are required to launch many capabilities supporting ultra-reliable low latency communications (URLLC), massive machine-type communications (mMTC), and network slicing.
Preparations are underway for 5G-Advanced (3GPP Release 18), with features like non-terrestrial networks (NTN), extended reality (XR), and advanced MIMO. The investment will be fundamental for advancing to 6G.
Another critical development is RAN decomposition and virtualization, which involves breaking down the RAN into individual components and running functions on commercial off-the-shelf hardware. Benefits include better utilization, greater scalability and flexibility, and cost reductions. Implementing decomposition and virtualization using O-RAN promises these benefits while breaking RAN vendor lock-in due to standardized, open interfaces.
Edge infrastructure investment is increasing to support new enterprise applications, integral to 5G SA and 5G-Advanced, by moving processing closer to end users, thereby reducing latency, and serving as a critical driver for cloud-native technology adoption. This approach requires flexible deployment of network functions either on-premises or in the cloud, leading to a decentralization of network traffic that was once concentrated. This evolving trend has become more pronounced with increasing traffic demands, blending network roles and boundaries, and creating a versatile network “edge” within the CSP’s framework.
Operational savings, including cost reduction and sustainability initiatives, are top priorities for CSPs to meet budgetary and carbon footprint goals.
Preparing your mobile transport for 5G Advanced and beyond
Mobile packet transport is critical in these initiatives and network transformation, leading to rapid changes in CSP transport networks. Traditionally, these networks relied on dedicated circuits and data communication appliances. However, modern transport is shifting toward a logical construct using any accessible hardware and connectivity services. Successful network architecture now hinges on the ability to seamlessly integrate a variety of appliances, circuits, and underlying networks into a unified, feature-rich transport network.
The Cisco converged, cloud-ready transport network architecture is a comprehensive solution designed to meet the evolving demands of 5G-Advanced and beyond. The architecture is particularly important for operators to navigate the complexities of 5G deployment, including the need for greater flexibility, scalability, and efficiency. Here’s a detailed look at its essential components:
- Converged infrastructure: Cisco’s approach involves a unified infrastructure seamlessly integrating various network services across wireline and wireless domains. This convergence is essential for supporting diverse customer types and services, from consumer-focused mobile broadband to enterprise-level solutions. The infrastructure is designed to handle all kinds of access technologies on a single network platform, including 4G, 5G, FWA, and the emerging direct satellite-to-device connectivity outlined in 3GPP’s NTN standards.
- Programmable transport and network slicing services: At the heart of Cisco’s architecture are advanced transport technologies like Border Gateway Protocol (BGP)-based VPNs and segment routing (SR), crucial for a unified, packet-switched 5G transport. These technologies enable a flexible services layer and an efficient underlay infrastructure. This layering provides essential network services like quality of service (QoS), fast route convergence, and traffic-engineered forwarding. Network slicing is also a key feature, allowing operators to offer customized, intent-based services to different user segments. This capability is vital for monetizing 5G by enabling diverse and innovative use cases.
- Cloud-ready infrastructure: Recognizing the shift toward cloud-native applications and services, Cisco’s architecture is designed to support a variety of cloud deployments, including public, private, and hybrid models. This flexibility ensures that the transport network can adapt to different cloud environments, whether workloads are on-premises or colocated. Virtual routers in the public cloud play a significant role here, providing required IP networking functions (including BGP-VPN, SR, and QoS).
- Secure and simplified operations model: Security and operational simplicity with service assurance are essential components in Cisco’s architecture. The network is designed for easy programmability and automation, which is essential for operational efficiency and cost reductions. This includes extensive telemetry and open APIs for easy integration with orchestration tools and controllers. Additionally, AI and machine learning technologies can potentially be used for real-time network visibility and actionable insights for optimizing user experience across both wireline and wireless networks.
The architecture is about current 5G capabilities and future readiness. Preparations for 5G-Advanced and the eventual transition to 6G are integral. The architecture’s design ensures operators can evolve their networks without major overhauls, thereby protecting their investment.
Cisco’s converged, cloud-ready transport network architecture offers a blend of technological innovation, operational efficiency, and flexibility, enabling operators to navigate the challenges of 5G deployment while preparing for the subsequent phases of network evolution.
Source: cisco.com
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