To Lower Costs, Wireless Networks Such as Dish and Rakuten Head to the Cloud

These days, everything lives in the cloud. Increasingly, mobile networks are doing their work there, too. That is especially true for wireless networks being built by upstart operators such as Dish Network and Rakuten Group that are trying to get a cost edge over bigger, more established rivals. The expense of installing and maintaining customized network equipment—made by suppliers such as Nokia, Ericsson and Huawei—helps explain why the bill for an unlimited monthly cellular data plan can top $70. A so-called virtualized network, by contrast, aims to put much of the functionality of that customized equipment into software programs that run on off-the-shelf servers. Tasks such as processing radio signals can then be done in the cloud, allowing carriers to reduce capital investment and operating costs. Companies such as Rakuten say maintenance costs are lower in a software-driven network because updates can be done remotely and all at once, rather than individually at base stations. It also makes it easier to fix problems and to shift and adjust network resources to areas where there is a sudden surge in demand—say, when a region is hit by a natural disaster—proponents say. Dish plans to introduce a 5G network running on cloud computing operated by Amazon Web Services. Dish Chairman Charlie Ergen has said that virtualization would transform the telecommunications industry by giving operators that don’t have existing infrastructure a chance to compete.