Telcos shortchanged?

“The Cabinet also decided to enable the development and setting up of Private Captive Networks to spur a new wave of innovations in Industry 4.0 applications such as machine to machine communications, Internet of Things (IoT), Artificial Intelligence (AI) across automotive, healthcare, agriculture, energy, and other sectors.”

Private tech companies can now enter the same business and offer better rates on the strength of virtually free spectrum.

The telcos had again and again reiterated to the government through its association, COAI that blocking frequency for industry would eat into the revenue that they are expecting from 5G services, “If private captive 5G networks are allowed, then there is no point in private operators rolling out 5G.

Telecom service providers will going forward, invest lakhs of crores of rupees in network rollouts. Enterprise services constitute 30-40% of the industry’s overall revenues. Private networks disincentivize the telecom industry to invest in networks and continue paying high levies and taxes.”

In any case, challenges including limited and expensive devices, lack of established use cases would affect wider adoption of 5G services, though some use cases are emerging from metaverse and private networks. On the 5G use cases internationally, the incremental revenues from 5G were very low. It has not resulted in significant revenue and ARPU (average revenue per user) upside for operators in countries that have launched 5G.

On the pricing too, the Cabinet formalised the decision by the Digital Communications Commission (DCC) on not reducing the spectrum base price despite a nudge from Niti Ayog and demands from telcos.

There is a dead silence in the media from the three telcos, Airtel, Jio and Vi and COAI to yesterday’s announcement.

CT Bureau