How Germany will harness advanced connectivity honed in Japan
One of Germany’s leading internet companies, 1&1, is building a groundbreaking 5G network that promises to deliver a step change in the performance of mobile connectivity. Drawing on Rakuten Mobile’s experience in Japan, 1&1 and Rakuten Symphony are setting up the network with a radical new radio architecture, called Open RAN (radio access network), in Germany – it will be the first fully virtualized mobile network in Europe.
“One thing is clear…the networks that don’t change, there will be a forced change in the future..I am rather feeling more secure to be on the front-runner side, instead of (on) the following side.”
Michael Martin, CEO, Drillisch Netz AG and Director Mobile Radio Network, 1&1 Telecommunication SE
In a panel discussion at Rakuten Optimism 2021, Michael Martin, CEO, Drillisch Netz AG and Director Mobile Radio Network, 1&1 Telecommunication SE, explained how Rakuten Mobile has paved the way for his company and other operators to take advantage of highly flexible and cost-effective Open RAN technology [1].
“Two, three years ago, I think the time wouldn’t have been ready, not even for a greenfield operator, to start with an Open RAN architecture immediately,” he said during a panel discussion with Tareq Amin, CEO of Rakuten Symphony and Group CTO of the Rakuten Group, moderated by Rabih Dabboussi, Chief Revenue Officer of Rakuten Symphony. But since Rakuten has “built this Open RAN 1.0 network already in Japan, we are confident that you already made your mistakes in Japan and can take the learnings into our Germany Open RAN 2.0 network and I am very confident that we will have a successful Open RAN implementation.”
The most advanced architecture yet
In the same session, Amin described the mindset and entrepreneurship of 1&1, which is a highly successful mobile virtual network operator in Germany, as “utterly amazing,” adding: “I think we are going to do something even better than we have done in Japan.”
“1&1 is going to build a network in Germany that I think is going to be superior architecturally to what exists in the marketplace today.”
Tareq Amin, CEO, Rakuten Symphony & Group CTO, Rakuten Group
Noting that radio access equipment accounts for at least 70% of the capital spending required to build a cellular network, Amin explained that Open RAN technology is designed to make cellular networks as elastic as IT systems working in the cloud, meaning they can scale up and down in line with demand.
The new network will be able to heal itself, organize itself, optimize itself and be able to adapt its capacity to usage, added Amin. The net result is that end-users will enjoy better coverage and greater reliability. “1&1 is going to build a network in Germany that I think is going to be superior architecturally to what exists in the marketplace today.”
“To my knowledge, this is the first contract that has ever been signed in which we guaranteed [total cost of ownership] transparency to our partner…This will never change because our objective from now on is to completely de-mystify the secrets of this radio access.”
Tareq Amin
Total transparency on costs
Another innovative feature of the partnership between Rakuten Symphony and 1&1 is an unprecedented level of cost transparency. “To my knowledge, this is the first contract that has ever been signed in which we guaranteed [total cost of ownership] transparency to our partner,” Amin said. “And, I assure Mike and the team, this will never change because our objective from now on is to completely de-mystify the secrets of this radio access.”
Martin described the partnership with Rakuten as one of three key pillars of its plan to deploy a 5G network in Germany. The other pillars are Open RAN and 1&1’s existing customer base, which numbers more than 10 million.
Solving the coverage conundrum
Having acquired spectrum in auctions in Germany, 1&1 now has to build 1,000 5G sites by the end of 2022 and reach 25% population coverage by 2025 and then 50% population coverage by 2030. “We are very confident that we will reach those coverage obligations even faster,” Martin said. In areas where 1&1 doesn’t have coverage, customers will be able to make use of Telefónica’s network through a national roaming agreement.
In every country, gaining access to sites for the new base stations can be a bureaucratic process. “In order to reach our target of 12,000 sites in the next coming years, there are still a lot of sites to be acquired and a lot of approvals to be given,” Martin explained.
A further challenge will be to secure low frequency spectrum, which is ideal for providing broad coverage. “There is an auction planned for the year 2025 where 800 MHz will be on the table and we are absolutely keen and very confident to get our fair share in this next auction,” Martin added.
Will other operators follow suit?
As a greenfield operator, 1&1 has the advantage of building a network from scratch. But Martin encouraged brownfield operators with existing networks to also roll out Open RAN technologies. “One thing is clear…the networks that don’t change, there will be a forced change in the future,” he warned. “I am rather feeling more secure to be on the front-runner side, instead of (on) the following side.”
The industry increasingly regards Open RAN as a necessity, Amin added. “In the last six months in the industry, we all have seen a tremendous mindset shift across the board. We are stronger if the entire ecosystem believes in the same values of bringing an agile, software-driven connectivity platform,” he noted. “Get out of the lab. I think we have done enough lab testing… This technology works, it works really well… there are huge opportunities here.”
[1] An Open RAN architecture employs open interfaces between the different components of the radio access network, allowing an operator to mix and match equipment from multiple different vendors, while also significantly reducing the amount of hardware that needs to be deployed at the site of each base station.
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