In a recent piece in Fierce Network, Joe Madden, principal analyst at Mobile Experts, came to a straightforward conclusion: “the industry is on a path toward higher value for connectivity.”
I agree, and that path is being driven by factors including cloud, 5/6G, AI, IoT, sovereignty goals and others that are all united in a software approach to networks.
As usual, the much larger terrestrial operators are ahead of the space industry on this. “Mobile network software is quickly becoming a stand-alone business that is not tied to hardware,” wrote Madden. “We’ve all heard this train coming into the station for several years, as operators have fully tested vRAN and are ready to use vRAN in the 6G cycle.”
When it comes to open networking in the ground segment, however, this time it looks increasingly like we space cowboys are reaching similar conclusions faster than we did in the past. More government space programs are inviting or specifying software-based solutions, most satellite execs I talk to are working it into their strategic plans and industry analysts are picking up the trend. In a recent white paper, research firm Novaspace noted, “Beyond the cost savings and ROI, virtualizing the ground is also a business necessity to enable agility, scalability and cost efficiency to unlock new revenue opportunities. Virtualization is seen as a key factor contributing to the projected $98 billion in cumulative spending on the ground segment through 2034.”
What has been happening in the mobile industry and is now accelerating with the maturity of vRAN and its role in 6G and AI enablement is also now becoming broadly accepted in the satellite ground segment as well. No surprise, since we are all part of the same supply chain. With more connections to more AI-driven data centers, more and bigger clouds, more smart devices, more robots and just plain more time spent connected comes more opportunity for both terrestrial and satellite communications providers.
And the software-based nature of those network systems will cause profound changes on the business side. As Madden points out, for example, “Last week Ericsson released its ‘AI-in-RAN’ portfolio, which is essentially a software upgrade that operators will buy through an annual subscription. That’s an important development that shows the transformation of the RAN market, from a hardware business to a software business. Operators are now willing to accept a subscription-based pricing model.”
The same trends will drive the satellite industry, because as the satcom industry moves away from broadcast to IP transport, it is no longer a separate thing but is fast becoming just a part of the larger global infrastructure that also includes fiber, Wi-Fi and mobile. All part of the growing cloud of connectivity options that designers will use to create networks to meet specific needs based on the application.
