650 Group Blog
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In a briefing with Rakuten Mobile today, we learned two neat things: It is experimenting with 3GPP on satellite, and it hopes to announced a full-stack Rakuten Communications Platform (RCP) customer as early as next quarter. The company also shared some plans that it has for improving coverage to 96% by the end of the summer '21, and that it believes it has a 50% total cost of ownership advantage for its 5G infrastructure versus a traditional network operator.
So, what's so important about "3GPP on satellite?" If satellites are able to communicate with all cell phones and other cellular devices, this would mean that coverage could be enabled where we might need to have placed macro base stations. If we don't need macro base stations everywhere as satellites provide that coverage in sparse areas, or maybe even along highway routes, then a future cellular operator might be able to build its network with far fewer macro towers and rely more on a "barbell" approach, with small cells providing high throughput in busy areas and satellites providing coverage between busy areas. This would reduce demand for 5G base stations. Rakuten expects that its satellite partner, AST, may offer satellite coverage for Japan at the end of 2023 or the beginning of 2024 - that is a ways off. But, this means that in 3 or so years, the need for base stations may be considerably reduced. Also, Rakuten spokesperson, Tareq Amin, said he thinks it is possible that Rakuten may announce its first RCP customer as early as next quarter. We published about RCP in November 2020, around when the team first started making RCP known to the public. This means that a division of a mobile operator, Rakuten Mobile, may be selling its know-how, technology and services to another telecom operator, presumably outside of Japan. This is a big deal in that most operators buy from vendors and systems integrators, not from others who are in the same business as them. It is also a big deal because cloud companies like Amazon, Microsoft and Google all want to sell their cloud services to operators, too. And, if RCP gets there first, and sells its full stack (radio, core, billing, orchestration, OSS) it would represent a first-ever full stack services deal.
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In conjunction with its recent Rakuten earnings call this week, Rakuten Mobile disclosed some more of its plans. This mobile operator is becoming a telecom vendor. Specifically, it said that “by expanding the Rakuten Communications Platform (RCP) globally, Rakuten aims to evolve from a Japan-headquartered tech company to a global leader in telecom.” We see this as an explicit statement that the company plans to sell its telecom software and related services to operators worldwide. For instance, Rakuten Mobile just announced a partnership with Saudi-based operator, stc. This move pits Rakuten against Microsoft (who just acquired telecom companies and runs a cloud), Oracle (who runs a cloud and made telecom company acquisitions), and the rest of the telecom industry (traditionally Nokia, Ericsson, Huawei, ZTE, Amdocs, Netcracker and others).
In offering RCP to other operators around the world, its unique value, as we see it, is that Rakuten has successfully built an LTE and now a 5G network based on Open RAN. What we find interesting is that the company has developed a significant amount of intellectual property in-house or through technology sharing. In an interview today with Tareq Amin, Rakuten Mobile executive, we asked what technology has been developed in-house by Rakuten. Here’s what we learned.
Some other components are not developed by Rakuten (the radios come to mind), but this is an exciting development. RCP would be delivered as a “private cloud” on the premises of carrier customers (partners). The terminology Rakuten is using for this “private cloud,” is it’s a “pod.” RCP’s plans are a very interesting development in the industry. There is one more thing. Rakuten said it is working with a technology supplier that will sell Rakuten a server card that would allow a combined router and RAN processing function to co-exist on a server. Today, the servers it uses to support its Open RAN radios use an FPGA NIC. These servers can support up to 16 base stations. We see the addition of routing to this card as an extension of the capability – but it means there may be a diminished need for cell site routers. |
CHRIS DePUY
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