The government may have big plans for the 5G rollout by 2020, but the road ahead is fraught with hurdles, including a high spectrum price coupled with telecom operators’ financial constraints.
No doubt, 5G will catapult India to another technological era in reducing the digital divide. But at a time when the focus is on expanding 4G services by the telecom industry, which is already battling declining margins and profitability, it will definitely be a tightrope for many players.
5G will usher in new technologies, including artificial intelligence, virtual reality, machine to machine communications, internet of things, amongst others. A host of test use cases were shown by the industry in the recently concluded event, which included the use of drone for agriculture monitoring, drones for security and surveillance, autonomous cars, telemedicine. Both Reliance Jio and Airtel showcased test use cases for 5G.
The buzz around 5G has gathered steam at a time when 4G is yet to be fully adopted by mobile users. With over a billion mobile users, only 400-500 million are connected through internet, while rest are still on 2G services – which is just basic voice services.
Not perturbed, the government is moving fast on 5G. It has created a high-level 5G forum under Stanford University professor A Paulraj. The forum recently submitted its report and final contours of the 5G policy are being worked upon by the department of telecommunications, DoT secretary Aruna Sundararajan said.
The first field trials under the aegis of the department of telecommunications (DoT) are expected to happen early next year. DoT has invited telcos, including Vodafone Idea, Airtel, Reliance Jio and BSNL along with equipment providers like Samsung, Ericsson, Nokia and Huawei to initiate field trials and demonstrate use cases for India with free spectrum allocation for a year.
The ministry will soon put in place a special regime to allow instant approval to companies willing to undertake research and development (R&D) and field trials for 5G. “We are putting special dispensation for 5G field trials and R&D for immediate approval, and that demonstrates India is not lagging behind for 5G,” she said.
The arrival of new telecom player Reliance Jio, a Mukesh Ambani group company, hooked Indians to data like never before. As per an Ericsson report, the total mobile data traffic per month in India is expected to grow 5 times from 1.9 EB to 10 EB by 2023. The monthly data usage per smartphone (GB/month) in India will increase from 5.7 GB in 2017 to 13.7 GB by 2023. The total smartphone subscriptions in the country will grow 2.5 times to cross 975 million by 2023.
However, the entry of Reliance Jio has pushed the financials of incumbents on a downward spiral apart from triggering a wave of consolidation in the industry, where now only three private players are left along with state-owned BSNL/MTNL.
At the moment, apart from one player, rest of the telecom players have expressed concerns over the high price of spectrum recommended by telecom regulator Trai. Experts say if an auction happens in near future, it will generate subdued interest as many players are facing financial constraints. Together, the debt of the telecom industry stands at around Rs 7.76 lakh crore.
Randeep Sekhon, CTO – Bharti Airtel, states “5G networks have the potential to truly transform lives. Large-scale deployment of 5G networks over the coming years will open unlimited avenues for innovating use cases that can solve complex problems.”
Ericsson report says 5G is expected to be deployed first in dense urban areas with enhanced mobile broadband and fixed wireless access as the first commercial use cases. Other use cases will come from industries such as automotive, manufacturing, utilities, and healthcare.
5G will enable a $27 billion revenue opportunity for Indian telecom operators by 2026, which will be over and above the revenue generated from traditional services expected to grow up to $63 billion by 2026. It has the potential to enable 43% incremental revenue opportunity for the Indian operators by 2026, as per the report by a 5G forum.
Rajan Mathews, director general, COAI, says 5G will cater to a specific niche market and it will be critical for areas such as healthcare – remote surgery, education, other automated functions, and it will allow operators to provide different services with different performance characteristics to address specific use cases.
In its 2019 telecom sector outlook for the APAC region, Moody’s Investor Service last week said India, along with Indonesia, Malaysia and Bangladesh are likely to hop on to the 5G bus a bit late.
These countries are likely to be late adopters of 5G services as they are still focusing on increasing the density of 4G coverage, Moody’s said.
Globally, 5G is expected to commercially start in few cities in the US and Korea by next year. 5G will give a maximum speed of 20 gbps compared to 1 gpbs with LTE/4G.
Another important aspect which needs to be addressed before the rollout of 5G services is data privacy and protection. A data protection law is already in the making and is expected to take shape soon. – DNA India