Half of all Indian companies prepare to boost ICT budget after 5G launch

About 50 percent of Indian companies will increase their budget allocation for information and communications technology (ICT) and industry 4.0 use cases, as 5G services are rolled out in the next 2-5 years says a KPMG India report published on Sunday.

The report adds that more than 85 per cent of Indian companies from various sectors expect up to 20 per cent return on investment (ROI) on 5G and industry 4.0 use cases. Applications such as non-time-critical communication, connected assets, seamless ecosystem communication, and remote operations are expected to attract the largest share of returns.

Targeting efficiency, quality management and new revenue models are main areas where companies are expected to implement 5G. Globally, nearly 51 percent of companies are looking to deploy 5G alongside other wired and unlicensed wireless technologies, according to the study.

KPMG India launched its Business Digital Transformation Survey 2022 based on a survey of more than 350 global companies in the manufacturing, healthcare, smart cities and utilities, telecom, media and technology verticals. He expects inconsistent network infrastructure, low adaptability in the multivendor ecosystem, and integration with legacy networks to become the main technical and business challenges in rolling out 5G in the country.

“In the next 2-5 years, there will be a visible increase in the amount of budget allocated to ICT as well as 5G/Industry 4.0 use cases. More than 85 percent of companies across multiple sectors expect up to a 20 percent ROI across various 5G/Industry 4.0 use cases,” the survey said.

The report recommends that telecommunications service providers (TSPs) conduct network upgrades with a continued focus on creating network outages, edge AI computation models, beamforming, dynamic spectrum sharing, performance of user equipment independent of network access and analysis technology.

Additionally, it suggests lowering total cost of ownership (TCO) to protect margins, while building strong networks and routes to market for 5G monetization.

Commenting on the report, Purushothaman KG, Head of Digital Solutions at KPMG India, said: “Our study shows that 5G will become the most transformative accelerator to drive digital growth and achieve the broader vision of digital India. Edge computing, AI-based cloud services, open source intelligence, and telemetry systems are expected to become widespread. India will see 5G drive growth not only in the telecom sector, making it an emerging sector once again, but also drive growth and digital transformation ambitions across industries.”

The study also calls for faster fiber deployment to improve tower fiberization from current levels. A forward-thinking policy paradigm that focuses on increasing access to affordable services and devices across the country is imperative for the journey ahead.

Yezdi Nagporewalla, CEO of KPMG India, said: “5G will be a catalyst on India’s path to reach 20% of digital GDP (by 2025). Today, among other things, digital transformation initiatives through smart factories, remote healthcare, and digital schools are real and working. With 5G, many of these initiatives will achieve scale and acceleration. The Indian telecommunications market offers the right ingredients to make a justifiable impact. This impact could reach up to 0.5 percent of incremental GDP growth due to elements of flexibility, low latency, and expansive connectivity, all of which will have a positive impact on businesses and their (direct and indirect) users.” JmolIndonesia