DENSE AIR HAVE DESIGNED AND BUILT A 5G SMALL CELL DEVELOPMENT NETWORK IN DUBLIN CITY. THE ‘NEUTRAL HOST’ SMALL CELL NETWORK WILL ENHANCE AND EXTEND CONNECTIVITY THROUGHOUT THE SMART DOCKLANDS AREA, ENABLING DEVELOPMENT OF PRIVATE NETWORKS, WIRELESS BACKHAUL, AND IOT CONNECTIVITY TO THE BENEFIT OF BUILDING OWNERS, OCCUPIERS, MOBILE OPERATORS AND ULTIMATELY THEIR SUBSCRIBERS.
5G IS COMING
Consider a future where 5G connectivity is embedded in nearly everything. 5G technologies will integrate and enable the full potential of mobile technology, big data, IoT, and cloud computing, while supporting digital transformation across numerous sectors including healthcare, smart vehicles, smart home and industrial automation.
5G connectivity is dependent on mobile operators who are already battling with the everyday challenge of providing a seamless service to their subscribers across their macros site estate. The networks of the future will raise the stakes even further; they will need to be significantly denser to be able to effectively support the exponential growth in data requirements and the burgeoning increase in connected devices. In developed countries, the market for subscribers is ultra-competitive with mobile operators running an almost flat ARPU line in a bid to win customers whilst also balancing the increasing demands on capital expenditure year after year. Simply put, the current operating model is unsustainable; subscribers demand more for less and expect a fast and reliable service wherever they are. The advent of 5G has heightened the pressing question for mobile operators on how they should flex their business models to enable a successful evolution of their networks to the next stage.
WHAT OPTIONS ARE AVAILABLE TO MOBILE OPERATORS?
The first and easiest logical step for mobile operators is to add a new technology layer onto their existing macro cell sites or masts. This option is only viable when there is a low level of users consuming a modest amount of the service. It’s the foundation to a 5G network but not a robust future-proof strategy.
The next step is to deploy a small cell network across the city centres to help increase coverage and capacity closer to the end user. Small cells have a much more targeted coverage footprint than their macro counterpart. A major city deployment will need small cells in their thousands working in tandem with existing macro sites to provide a denser more pervasive network – Where It Matters. Added to this, is the emergence of new user models from councils to enterprises, looking to leverage the potential 5G networks which adds a new market of potential subscribers into the equation.
THE PERFECT STORM; THE NEED FOR A NEW MODEL OF DEPLOYMENT
In general, mobile operators provide an ‘outside-in’ deployment model. Radio signals from a macro site, penetrate building walls to serve indoor users. This model works well on the lower frequency spectrum of today, however, 5G networks operate on a higher frequency which will have difficulty penetrating buildings, and in the case of modern buildings, the signal will simply bounce back. Equipment will need to be installed inside buildings to overcome this problem effectively, marking the end of the outside-in model for 5G networks.
Propagation issues are not solely confined to buildings. In the outdoor arena, the 5G frequencies will not travel as far as their predecessors and will require a secondary layer of sites or small cells to fill the resulting coverage and capacity gaps. This small cell network will need to be hosted on the cities infrastructure with a power supply on tap, presenting a fresh set of challenges in terms of site acquisition, backhaul and civil works – all with an associated price tag.
To deliver a 5G network at scale mobile operators are facing the reality that building their own infrastructure is prohibitive, especially in the current climate of flat ARPU and increasing capital expenditure costs. Whilst 5G networks offers a much-needed new revenue potential, mobile operators will need to work out how to cross the investment gap to move forward. Enter the neutral host providers, and the potential saviour in the small cell network headache.
DENSE AIR’S NEUTRAL HOST SERVICE IN THE SMALL CELL NETWORK SPACE
Neutral host operators are what they say on the tin, they carry the traffic from multiple operators, on dedicated spectrum, using their own small cell network. Such operators aim to support and complement the mobile operators with the capacity and coverage issues 5G networks present. The small cell network operated by the neutral service provider broadcasts on a different spectrum, effectively augmenting the mobile operators 5G network, saving on capital investment and minimising interference between their 5G macros network and the small cell one.
Dense Air is representative of this new breed of next generation operator. They aim to help mobile operators meet their network deployment challenges both in the networks of tomorrow as well as supporting upgrades to their current network by deploying critical capital on their behalf.
Operators like Dense Air do not compete with mobile operators but look to complement and enhance the services provided by them. The proposition is centred around providing a dedicated licensed high-frequency spectrum and a neutral-host small cell infrastructure that can be used simultaneously by multiple mobile network providers, simplifying the small cell installation process for both existing mobile operators and city councils and municipalities; This is a game changer in terms of how networks are densified to cost-effectively enhance the services provided by mobile operator’s.
IT’S MORE THAN TECHNOLOGY IT’S ABOUT PARTNERSHIPS
Delivering effective 5G networks needs to extend beyond the partnership between technology providers and include stakeholders within cities and towns – the guardians of the infrastructure that will host small cells and also the strategy setters of the smart cities agenda. Research has demonstrated that cutting edge mobile infrastructure is a leading driver of economic growth; every 10% increase in mobile phone usage, leads to 0.8% growth potential in a countries GDP; a powerful driver for local authorities to get this right and right quickly.
The neutral host operators are the intermediary in the three way partnership. Deploying a small cell network leveraged by all, eliminates the need for a separate small cell network for each mobile operator, reducing the carbon footprint and mitigating the negative visual impact that goes along with that.
From a mobile operator’s perspective, sharing the network infrastructure cost, both capital expenditure and operational expenditure, allows them to optimise their investment plans and focus on macro cell deployment and targeted network roll-out. This also results in cost and efficiency savings across site acquisition, planning, and the provision of backhaul and power for each site – but at the same time enjoying the benefits of accelerated 5G densification.
A CASE STUDY IN THE MAKING WITH DUBLIN CITY COUNCIL
The partnership between Dense Air and Dublin City Council looks to address the deployment challenges that are anticipated with the introduction of 5G networks. Dense Air’s small cell network has effectively utilised the council assets to ensure the network can deliver the right coverage whilst allowing all mobile operators to leverage their connectivity through its wholesale service.
In addition to providing the small cell network, Dense Air also provided the optimal network layout through its big data analytics engine, DenseWare. By correlating city infrastructure asset data, such as lamp posts, traffic lights, bus stops and building data, DenseWare can determine the available assets and locations where small cells should be targeted; creating an efficient network laydown. The software can also determine the probability of whether a small cell will improve mobile operators’ capacity and end–user location capacity, coverage and quality of experience. This is done by collecting billions of data records (anonymously) every day to build a mesh of mobile performance across all mobile providers networks.
UNDERSTANDING THE BARRIERS TO WIDESCALE DEPLOYMENT
To date there has been a relatively modest investment by mobile operators in outdoor small cell deployment which has largely been driven by operators need to provide spot coverage in places where there are coverage holes or blackspots from existing macro coverage areas. 5G densification will require a new level of small cell deployment to meet the coverage and capacity requirements.
Whilst it is agreed by all that 5G is coming there are still barriers that need to be overcome to ensure an efficient roll out of future networks.
- Access to suitable mounting locations through leveraging city assets. There are many important factors that need to be considered for optimal small cell deployment, the most important being location; a structurally suitable asset is required to mount small cell equipment.
- Power. Cities are the customer of energy providers – powering traffic lights, public lighting and other public infrastructure – a key milestone in small cell deployment is to understand how to access ‘powered’ assets around the city. Agreeing a process how energy providers administer, track, and rate power usage are critical steps to overcome in facilitating large scale deployments.
- Scalability. Small cell deployments in major cities will require several thousand sites. Having an up-to-date, relevant asset database, access to suitible structures and an efficient planning process will be essential for an effective roll out.
- Cost of Deployment. The Total Cost of Ownership (TCO) for small cells has long been the barrier to widescale adoption. Although equipment costs have reduced, installation costs remain one of the major issues. Installation time is critical given the volume of small cells, not only for associated labour costs, but also the requirement for highway regulations, including lane closures, notices, permits and wayleaves.
- Scalable Processes. To date, outdoor small cell deployments have been managed through ‘traditional’ mobile operator engineering processes, designed for macro installations. These processes do not fit well for large scale installations on public street assets which need to be highly repeatable, scalable and accelerated, enabling deployment in weeks, not months and years.
- Viable business case. The business case is perhaps the most important item to address. Small cell deployment on 3G and 4G technology have halted due this challenge. The objective in deploying small cells is primarily to deliver more capacity and coverage into the mobile networks. There will naturally be a significant increase in the total volume of cellular base stations but not a significant increase in revenue for the mobile operators. The major cost driver in small cell deployment is not the technology itself but its site acquisition, installation, power and backhaul. Creating a scalable deployment process within a city for small cell deployment must be done with one eye on the TCO. Small cells deliver a fraction of the coverage of that compared to a macro cell and the TCO needs to be reflective of this. Premium rents for small cells by local authorities on their assets will constrain deployment.
DEVELOPING SUSTAINABLE COMMERCIAL MODELS
Even after defining a suitable delivery model this will need to be supported by a viable commercial model. A number of new models are emerging including;
1. Concession Models. Concessions models have been used by many councils in order to encourage investment in connectivity such as WiFi, mobile or fibre by offering a period of exclusivity in return for an upfront fee and a share of ongoing revenues. An advantage to this model is that it allows councils to work with one, rather than multiple entities, thus freeing up their own resources. The challenges faced by councils who choose the concession model is how to maintain competition in the provision of networks and prevent the concession acting as a barrier to wider investment.
If the concession model is to be used, councils and network providers are encouraged to ensure agreements that include;
- A focus on unlocking investment in high-capacity digital infrastructure, including in hard-to-reach areas.
- A mandate that the concessionaire offers open access to network providers on fair, reasonable and non-discriminatory terms.
- Industry consultation on approach to ensure the right outcome will be achieved for all stakeholders.
Many councils have signed concession deals that have allowed a provider/integrator exclusive rights to deploy wireless and mobile ‘small cell’ transmitters on street furniture such as lamp posts. The provider then offers a service to mobile operators for use of the street assets and management of the small cells ‘as a service’. The local authority is then rewarded with a share of the revenue gained from the mobile operator.
These models have resulted in a nominal deployment. Initial concession awards have been extremely high value and concessionaries have subsequently attempted to pass these costs on to the mobile operators. Obtaining planning permission for deployment is very bureaucratic, with each deployment requiring an individual application which has resulted in many months delay and numerous applications
2. Special Purpose Vehicle (SPV). Another approach is for councils to deploy a 5G neutral host ‘RAN as a service’ network using dedicated radio spectrum that can support the customers of all mobile operators. This would reduce the need to process the myriad of small cell requests from the operators, reduce the visual impact of adding unilateral uncoordinated mobile infrastructure, and improve the economics for the operators. Funding and running such a 5G neutral host network on its own would be a challenge for any council. A more holistic and practical approach would be for an authority to work with a third-party operator, such as Dense Air through the implementation of a public/private partnership to help fund and operate the network. Besides not having to allocate budgets to fund these essential investments, working with a third party offers the potential to generate revenue streams from these networks for an authority and the city. A third-party operator could offer revenue sharing opportunities, in exchange for building out a 5G neutral host network, with encouragement from the city, providing support to mobile operators’ customers.
5G THE JOURNEY HAS BEGUN
5G enables new kind of operators to own and deploy neutral host networks to support subscribers and enterprise customers. But while development of 5G networks is critical for major operators, their capital expenditure budgets are challenged to fully fund the full deployment.
Mobile operators are familiar with network sharing arrangements for their macro site estate, but the cost savings potential for network sharing is even stronger with 5G small cells. The rationale for sharing extends well beyond cost, potentially solving many practical roadblocks of 5G deployment in urban areas and delivering a major uplift to the performance of a mobile networks at a transformational cost point.
It will not be economical for mobile operators to deliver the density of small cells required to support the growing demand with the deployment models to date. Only through collaboration, partnerships and new deployment models will this be possible.
Councils cannot afford to be left behind, they need to become active stakeholders in the conversation on how to effectively build the networks of the future, to support society. They will need to help drive the agenda which extends more than simply managing the conversations but defining and creating appropriate policy and mandating a rollout that is efficient, affordable, scalable and repeatable; to the benefit of all.
Through an innovative neutral host delivery and commercial model, cities can enjoy the benefits of pervasive 5G connectivity far sooner and more economically than ever would otherwise be possible directly from mobile operators.