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5G Perspective

Enabling Indian MSMEs to break new ground with 5G

Service providers in India are already looking at the limitless opportunities that 5G can offer enterprises keen on digital transformation. It is not uncommon to see service providers encouraging enterprises to tap onto their 5G networks, leveraging services such as real-time network slicing and the ability to run cloud applications on-demand. For instance, Airtel announced a strategic partnership with Vultr, a privately held cloud computing company, to offer cloud solutions to Indian enterprises earlier this year.

Such examples mean that enterprise customers would not need to worry about how to adopt 5G or build their own 5G infrastructure – and can use 5G as-a-service in real-time. In a digital-first future, such all-encompassing, open and cloud-ready solutions may be the cornerstone of every enterprise’s operations.

What about Micro, Small, and Medium Enterprises (MSMEs)? How does 5G apply to this select group, and what is the opportunity for service providers?

With around 630.5 lakh micro-enterprises, 3.3 lakh small businesses and 0.05 medium businesses, India has one of the largest pools of Micro, Small, and Medium Enterprises (MSMEs) in the world, contributing significantly to the country’s economy. As the 5G ecosystem continues to grow in India, it promises to transform how MSMEs compete in India by enabling new use cases like remote surgery, Industry 4.0, and smart cities. This will enable MSMEs to maximise profit by improving both productivity and efficiency.

Most MSMEs rely extensively on mobile phones and public wireless networks to run their business. This is hardly surprising, considering a significant percentage of people in India access the Internet for the first time via mobile.

The Covid-19 pandemic also accelerated the adoption of mobile enterprises from all segments, including MSMEs. A recent survey, MSME Digital Index 2023, conducted by PayNearby, reveals that 66 percent of MSMEs use smartphones for business activities consuming 2GB-5GB of data each day. Interestingly, 55 percent of surveyed MSMEs used mobile hotspots to connect to the Internet at work and 73 percent used mobile Internet to connect to the Internet at home. On the other hand, only 30 percent of the surveyed MSMEs used Wi-Fi routers, and the use of ethernet cables and dongles was just 10 percent and 5 percent.

Gaining new capabilities and efficiencies
All this makes 5G extremely relevant to small and medium enterprises in the country. The promise of ubiquitous coverage providing ultra-high speed and extremely low latency of less than one millisecond will provide more reliable connectivity to small businesses, helping them to focus on their core competencies to grow their business. Furthermore, the 5G network increases mobile network capacity over 4G, allowing more users to connect to the network without any impact on network performance than ever before.

The growing aspirations of new-age India demand improved connectivity and 5G will play a crucial role in ensuring this. Since its launch in India in October 2022, 5G has already helped the country improve download speeds by 115 percent, from 13.87 Mbps in September 2022 to 29.85 Mbps in January 2023, as per the recent Ookla report.

5G will open up a world of new opportunities for Indian MSMEs by providing a robust connection to cloud applications. For MSMEs dependent on network-related tasks, such as online sales or sharing of documents and files across the cloud, having access to faster speeds means these businesses will be able to get tasks done quicker and more efficiently. This, in turn, will help enhance the workforce’s productivity, leading to improved bottom lines. Cloud computing has already become a crucial component of any digital transformation, whatever the size of the organisation. More reliable connectivity will help in the wider adoption of cloud-based applications and, in turn, will fast-track the digital transformation of MSMEs.

The promised low latency provided by 5G will allow people to communicate more effectively and efficiently, which is especially relevant to MSMEs working in logistics, healthcare, and manufacturing. Low latency also drives improved customer experiences, where every sale is crucial to commercial success.

5G levels the playing field by empowering MSMEs to be as agile digitally as they are operationally. It also enables them to be more innovative by providing opportunities to explore new business models and technologies, like the Internet of Things (IoT). 5G’s growing ecosystem will allow MSMEs to leverage the capabilities of the IoT to grow their revenue by improved management of operations.

Furthermore, they will also be able to use other 5G-connected technologies, like Virtual Reality (AR) and Augmented Reality (AR), to better train their employees and to showcase their competencies to prospective customers.

The MSME opportunity for service providers
As per the latest data released by the Indian Government, MSMEs contributed 26.83 percent in Gross Value Added to the country’s GDP in 2020-21. By 2025, the Ministry of MSME aims to increase the sector’s contribution to up to 50 percent of the country’s economy. The potential for MSME growth is limitless.

For instance, Fixed Wireless Access (FWA) is a key use case of 5G and can allow service providers to provide high-speed connectivity to MSMEs in remote and difficult-to-reach areas. Typically, these areas have remained unconnected because it could be expensive to lay and maintain fibre. 5G FWA changes this and will play a crucial role in bridging the digital divide and in empowering small businesses in rural and remote areas to participate actively in the global digital economy.

For 5G to truly help MSMEs, it is important to have available a robust network that is designed, built, and managed to provide ubiquitous coverage with the high speed and low latency that mobile MSMEs need. Only then will MSMEs be able to leverage the vast potential of 5G technology to enhance productivity and efficiency to grow their business and revenue.

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