Are Heterogeneous Cloud-Based Radio Access Networks Cost Effective?

Mobile networks of the future are predicted to be much denser than today's networks in order to cater to increasing user demands. In this context, cloud based radio access networks have garnered significant interest as a cost effective solution to the problem of coping with denser networks and providing higher data rates. However, to the best knowledge of the authors, a quantitative analysis of the cost of such networks is yet to be undertaken. This paper develops a theoretic framework that enables computation of the deployment cost of a network (modeled using various spatial point processes) to answer the question posed by the paper's title. Then, the framework obtained is used along with a complexity model, which enables computing the information processing costs of a network, to compare the deployment cost of a cloud based network against that of a traditional LTE network, and to analyze why they are more economical. Using this framework and an exemplary budget, this paper shows that cloud-based radio access networks require approximately 10 to 15% less capital expenditure per square kilometer than traditional LTE networks. It also demonstrates that the cost savings depend largely on the costs of base stations and the mix of backhaul technologies used to connect base stations with data centers.