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Nokia (NOK) Tests RAN Open Source With AT&T on 5G Network

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Nokia Corporation (NOK - Free Report) has reported the successful conduction of a trial of the Radio Access Network (RAN) Intelligent Controller (RIC) on AT&T’s (T - Free Report) 5G network in New York. This represents a significant milestone toward the advancement of RAN network intelligence, openness and programmability to improve wireless network efficiency and end-user experience.

Nokia is considered an advocate of RAN network openness and has been effective in various open source communities, contributing code and defining open interface specifications. In January 2019, the companies announced their partnership to co-develop the RIC software platform. This is in line with the O-RAN Alliance target architecture to expedite the creation of open-source software for the 5G RAN.

The RIC helps communication service providers open up novel opportunities. One of them is the RAN programmability for easy integration of AI and ML algorithms to automatically optimize the network. The RIC software is currently available at the O-RAN Software Community. When implemented on the network, the RIC platform will enable increased network optimization capabilities through closed-loop automation.

In the trial, Nokia and AT&T ran a series of external applications, xApps, at the edge of AT&T’s live 5G mmWave network on an Akraino-based Open Cloud Platform. The xApps were designed to improve spectrum efficiency as well as offer geographical and use case-based customization. The companies tested the RAN E2 interface and xApp management and control, collected live network data using the Measurement Campaign xApp, the neighbor relation management using Automated Neighbor Relation xApp, and tested RAN control using the Admission Control xApp.

Nokia and AT&T will continue to collaborate to advance the development of the RIC and help build an open ecosystem of applications. With the O-RAN-defined RIC and E2 interface, the industry will likely accelerate innovation and create new business models. An open and programmable RAN enables new capabilities for the use of 4G and 5G networks. Overall, it allows a service provider to grow the business through an open ecosystem and faster time-to-market.

Meanwhile, Nokia is developing its 5G portfolio, strengthening AirScale and advancing the capabilities of its ReefShark chipset. The company is working with multiple partners to support its ReefShark family of chipsets, which are used in many base station elements. Nokia is witnessing a healthy momentum in its focus areas of software and enterprise, which augurs well for its licensing business.

The company’s end-to-end portfolio includes products and services for every part of a network, which helps operators enable key 5G capabilities such as network slicing, distributed cloud and industrial IoT. It facilitates customers to move from an economy-of-scale network operating model to demand-driven operations by offering easy programmability and automation.

At the same time, the company seeks to expand its business into targeted, high-growth and high-margin vertical markets to address opportunities beyond its primary markets. It had earlier announced plans to accelerate strategy execution, sharpen customer focus and reduce long-term costs. This, in turn, is likely to position the company as a global leader in the delivery of end-to-end 5G solutions.

Nokia has a long-term earnings growth expectation of 13.3% compared with 14.6% of the industry. The stock has surged 64.3% compared with the industry’s growth of 37.7% in the past three months.


 

Nokia currently carries a Zacks Rank #3 (Hold).

A couple of better-ranked stocks in the broader industry are Ooma, Inc. (OOMA - Free Report) and Acacia Communications, Inc. (ACIA - Free Report) , both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Ooma has a trailing four-quarter positive earnings surprise of 228.2%, on average.

Acacia has a trailing four-quarter positive earnings surprise of 17.7%, on average. The company’s earnings beat the Zacks Consensus Estimate in three of the last four quarters.

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