22 Jun Germany’s United Internet goes down Rakuten route with plan to build 5G network based on open RAN | Light Reading
Ralph Dommermuth, the CEO of United Internet, signaled that its subsidiary 1&1 Drillisch intends to build a high-performance 5G network based on open radio access network (RAN) technology.
1&1 Drillisch is aiming to become Germany’s fourth mobile network operator after acquiring 5G-enabling spectrum in 2019. Speaking during the second “Mobilfunkgipfel” (mobile summit) organized by the German government, Dommermuth outlined an ambitious goal: to follow the example of Rakuten Mobile in Japan and build a fully virtualized 5G network in Germany. (See Germany raids telcos for 6.5B in epic 5G auction.)
In an interview with German technology website Golem.de, Dommermuth also said 1&1 Drillisch is in advanced negotiations with three vendor partners, although he did not reveal any names. However, he indicated that the new entrant intends to eschew the more traditional network infrastructure providers.
Rakuten Mobile has become a litmus test for open RAN technology, which promises to bring interoperability and lower-cost equipment into a mobile market currently dominated by Ericsson, Huawei and Nokia. The company has awarded its 5G core network contract to NEC, which is already a 5G radio partner and is among a wide range of vendors supporting Rakuten’s 4G and planned 5G network. (See Rakuten Mobile launches assault on global telecom market and Rakuten unwraps NEC’s 5G core.).
It’s worth noting here that Rakuten plans to package its new mobile strategy into a product that it will sell to other companies worldwide. It remains to be seen whether 1&1 Drillisch would be interested in benefiting directly from Rakuten’s experience, building its network based on the Rakuten Communications Platform. After Rakuten and now Dish, 1&1 Drillisch is only the third mobile operator worldwide and currently the sole European operator that seems to have plans to use open RAN on a nationwide scale in a developed market. (See Rakuten Mobile launches assault on global telecom market.)
Meanwhile, Dommermuth also made use of the mobile summit to reiterate calls for a national roaming agreement that would allow 1&1 Drillisch to use the networks of the three established players Deutsche Telekom, Telefnica Deutschland and Vodafone Germany to provide coverage in rural regions. The CEO said little headway had been made on negotiations with the three operators to date and called on German regulator Bundesnetzagentur for support “so we can get going.” After all, he said, 1&1 Drillisch is talking about an investment amounting to around 10 billion (US$1.12 billion).
“We are ready to go,” Dommermuth said. “We are now waiting for national roaming.”
Torsten Gerpott, a telecoms expert at the Duisburg-Essen University, told Augsburger Allgemeine that “Drillisch wants to access resources as cheaply as possible” but the three established operators “are interested in keeping the new competitor as small as possible.”
United Internet indicated last month that the cost of building its new 5G network further impacted its bottom line in the first quarter of 2020, despite previous reports that the network rollout has been delayed by COVID-19. It appears that the operator has not yet started on the construction of 5G masts.
The company said initial costs for 5G rose to 2.8 million ($3.1 million) in the first three months, up from 1 million ($1.1 million) a year previously. In 2019 as a whole, 5G costs amounted to 5.7 million ($6.4 million).
Anne Morris, contributing editor, special to Light Reading