The 5G conundrum

Would it be more prudent for India to bypass 5G and leapfrog into 6G? It is not as wild a proposition as it seems to be at the first moment. USA has considered it, and China is already aggressively working on 6G.

Bohler, CEO of the US International Development Finance Corporation, concerned about losing its leadership in 5G, field had proposed that United States surpass China’s advantages in 5G technology by bypassing 5G, increase investment in 6G through leapfrog development, and curb China’s leading position in the field of communications technology. This was way back in August 2020.

China is already on the development of 6G. Last November, the country successfully launched the world’s first 6G test satellite, China’s 14th Five-Year Plan (2021–25) includes a plan to accelerate its nascent 6G industry, Huawei has a 6G research center in Canada while Oppo has invested approximately 50 billion yuan (USD 7.7 billion) in R&D projects that partly focus on 6G.

Last year, scientists from Singapore’s Nanyang Technological University and Japan’s Osaka University announced the development of a chip for terahertz (THz) waves, which can be used in 6G. Korea too is working on this technology.

Outside Asia, a group of companies in the United States – including Apple, AT&T, and Google – have formed the Next G Alliance. With its massive potential, 6G could become the next technological battleground for geopolitical competition between the US and China.

Of course, the International Telecommunication Union is still fine-tuning the standard, and many other technological advancements need to be made. A definitive framework is expected in 2028, with the first commercial 6G applications reaching the market by 2030.

Why is 6G’s importance being expressed so early? 5G, despite popular prognoses, is not equipped entirely for the new-age Internet-of-Things (IoT), cyber-physical continuum (extended reality, virtual reality, and mixed reality) gadgets, autonomous vehicles and systems, and connected robots. Where 5G 1 gigabyte per second rate requirement and expected latency of 5 milliseconds is suitable for operating sensors, drones, and cell phones, operating the new-age gadgets demands a higher bit rate, between 100 and1000 Gbps – venturing from gigahertz (109) into the yet unexploited terahertz (1012) spectral ranges, latency less than 1 microsecond, and superior reliability performance.

6G, being evolutionarily superior, will cater to these advanced requisites and is projected to create enormous demand for smaller, energy-efficient, and artificial-intelligence-enabled transreceiver cells and path-breaking cell-free transreceiving surfaces that can be put also on low-Earth-orbit satellites, aerial drones, stratospheric balloons, and blimps.

Therefore, the potentially multi-trillion-dollar 6G and auxiliary technologies market will see an even more intense ICT duel between China and the US.

India is at the same juncture as USA was when Bohler proposed that US bypass 5G. Not much progress has been made in India. Apart from the three telcos, being 5G-ready, started trials, demonstrated a throughput of over 1 Gbps during the live trial, formed collaboration with leading companies for core, edge, cloud, etc., not much has been done. It is a long road ahead.

There remains 5G spectrum pricing and allocation uncertainty. The authorities have yet to finalize invite bids, finalize spectrum bands and freeze reserve price. While Jio is flush with funds, the telco has no legacy issues, compared to Vi and Airtel; however customer profile and loyalty is an area of concern, and it could use 5G as a tool to further disrupt the market and gain at expense of competitors especially Vi. Its heart is in the home-grown technology, that is far from ready. Airtel is in a sweet spot. Customer base has proven loyal, decline in subscriber numbers arrested and reversed; prospects of improved financial perfor­mance have seen their stock price double over the last couple of years, from 324 to 622; for them investment in 5G makes sense if there is an assured return, on the large outlays required for spectrum and equipment purchase, and currently their thinking seems to wait it out till more use cases are there internationally. Vi can barely keep its head above water. While the telco is fully equipped for 5G, with the experience of its parent company already run­ning the services in UK, the telco has its hands full with finding way to pay dues to the government, meeting its obligations with the vendors, arresting decline in subscri­ber base numbers, and looking to gradually raise tariffs. These huge challenges, and the telco can ill-afford the additional financial burden that 5G would place on it. BSNL will require major hand-holding, unless of course it merges with Vi, which then is a completely different story, and perhaps opens another Pandora’s box.

India is ill-equipped on the fiberization and towers front too. The country needs 7.5 million kilometers of fiber to be deployed, only 2.68 million kilometers have been deployed to date, amounting to a CapEx of up to ₹2–2.5 lakh crore on fiber over a 10-year CapEx cycle. Currently, around 33 percent of telecom towers are connected when at least 70 percent are needed to fully utilize the potential, which 5G services could offer, amounting to a CapEx of ₹45,000 crore by 2024.

Consumers throughout the country are well aware of 5G. They are excited about its potential to improve their access to the internet, especially via mobile devices, but are in a rush to get the new technology – in a scenario where a new mobile device would be required to access 5G. They are less enthused about benefits they do not perceive as being directly relevant to their daily lives, such as virtual and augmented reality, drone delivery, and hologram video calling.

Overall, consumers value the potential of 5G to improve their lives, but are not sure they would be willing to pay an over and above their existing monthly telephone plans to have access to it.

With the government having reversed its stand on the retrospective tax, it may just decide to see the big picture and take a stand and back 5G all the way. Without that, 5G seems to be one hell of a climb that India may find itself not so well equipped to undertake!