Blockchain’s possible role in network infrastructure

SEP 09, 2022

Marcus Bagnall, telecoms and technology partner, and Ben Towell, paralegal, of Wiggin LLP, investigate the growing role of blockchain in telecoms network infrastructure.

Realising 5G’s full potential requires confidence in the security, resilience and performance of its underlying infrastructure. The UK government’s decision to ban Huawei from UK 5G networks has highlighted the current resilience risk of having few suppliers for critical network equipment and infrastructure. Addressing this requires a comprehensive strategy to encourage innovation for new and existing vendors, open-interface solutions and diversified interoperable supply chains from the ground up.

Mobile network operators (MNOs) are applying disaggregated network models to facilitate 5G roll-out by lowering total cost of ownership. Network disaggregation involves breaking down traditionally “bundled” network components supplied by one vendor into smaller ones and provisioned more efficiently, including by using software-defined configurations. Improved hardware vendor competition, innovation and interoperability promises more efficient and flexible, and therefore cheaper, network deployment and better coverage. MNOs can then focus on more efficiently using what is there.

A version of this is already happening with a very different type of network operator: the completely decentralised (not just disaggregated) wireless networks comprising of peer-to-peer individuals hosting small, compatible cells who earn cryptocurrency rewards for “proof of coverage” and carrying data packets.

While the House of Commons Science and Technology Committee is being told that blockchain “innovations” too often seem to offer solutions to problems that do not need solving, this novel application of decentralisation to digital infrastructure could be a substantive use case for blockchain that is not finance nor digital assets trading.

BYO base stations

Decentralised wireless networks are up and running today. Hosts provide their own compatible antennas, broadband connection, and earn cryptocurrency rewards for providing coverage and data. Customers pay for data transmitted over the network through their connected devices using cryptocurrency, which figures into the reward to hosts responsible for transmitting those data packets. Pollen’s network which focuses on LTE and Helium’s network which supports LoRaWAN for internet-of-things (IoT) devices in the UK are examples of operational decentralised networks.

This potentially offers an alternative solution to the last mile issue where new infrastructure is prohibitively expensive, such as new 5G cell sites in urban environments. Decentralised networks address resilience risk by involving multi-vendor interoperable antennas combined with a crypto miner that can utilise any broadband connection (fixed or wireless) for backhaul. The use of a blockchain ensures transparency, security and reliability. Hosts mine crypto via “proof of coverage” to tangibly support propagating a functioning network, rather than for proof of work or stake.

Then why hasn’t this happened everywhere already?

By removing centralised infrastructure from the equation, the model raises several legal, regulatory and commercial challenges.

Compliance with GCEs: Electronic communications networks (ECN) and electronic communications services (ECS) providers in the UK must comply with the General Conditions (GCEs). GCE compliance is cumbersome, difficult to maintain or just outright impossible on a decentralised basis.

Using retail broadband services for wireless backhaul: Retail ISPs may prohibit their customers from using a residential broadband service to provide backhaul for a third-party network, such as a decentralised wireless network. Doing so would risk customers breaching their ISPs’ service terms or fair use policies. ISP policies may require customers to take up more expensive, business-grade services for this purpose.

Privacy, security and resilience: Networks, including those serving IoT devices, must be highly robust, resilient and meet minimum-security requirements. This is far more challenging for a decentralised network involving multiple hardware vendors, a multitude of hosts and greatly reduced centralised control functions. Proposed IoT cybersecurity rules in the UK underscore regulatory concerns regarding protecting consumers’ IoT devices from hackers.

Lawful interception: Encryption and aggregation applied to network traffic traversing decentralised networks mean that hosts are unable to identify individual data packets. Such networks would still need to maintain capability to comply with lawful intercept requirements.

Spectrum: Decentralised networks currently rely on using licence-exempt spectrum. In the UK, spectrum for LTE and 5G frequency bands is subject to costly and exclusive licences held by MNOs. Spectrum availability will therefore significantly impact potential decentralised wireless network functionality.

Disaggregated network architecture is already revolutionising how mobile network operators operate, fundamentally changing how resources are deployed, applying technology to achieve efficiencies and encouraging vendor collaboration to achieve interoperability. Decentralised networks are a step further towards truly liquid network functionality but require greater coordination and there are management and supervision challenges to overcome. Given how other sectors are adopting blockchain technology and decentralisation, it is easy to envisage these networks gaining further traction in the UK.

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