Proponents of open approaches to radio access networks tout its cost savings. Opponents often argue the savings will be not as great as claimed. Much hinges on assumptions about radio access network cost.
Some argue the radio access network represents 70 percent of capital investment. Others might argue it is as low as 20 percent. Also, assumptions about base station costs matter. Access network cost includes spectrum, construction and backhaul, which might or might not be included in any tally of radio access network costs.
Operating costs can also be an area of cost savings, especially if virtualization allows centralization of active network elements to fewer locations.
The advent of open radio access should reduce costs for hardware and possibly software. Just how much is the issue.
In principle, network densification, which implies many more radio locations and radios, magnifies the amount of potential savings. In other words, projected savings for a less-dense macrocell network should be different from savings for a dense small-cell network.
In other words, a 20-percent savings on a category that represents 20 percent of cost is one thing. Saving 20 percent on a cost category that represents 40 percent of cost is another matter.
The operating cost assumptions also might have to include higher costs for managing and integrating network elements from multiple vendors.
All that noted, access networks traditionally have represented as much as 80 percent of fixed network cost and as much as 60 percent to 70 percent of mobile network cost. That is roughly the case for either capex or opex.
Open approaches to radio networks should allow cost savings. Just how much savings are possible remains the issue.
