For a data-hungry India, the upcoming 5G auction will usher in another telecom revolution. It goes beyond super-fast downloads and uploads, or glitch-free video calls, live streaming and real-time gaming. 5G holds the promise of a technological utopia – from automated cars to robotic surgery and much more futuristic technology. 5G could also end telecom companies’ monopoly on telecom services as the government is allocating spectrum to private enterprises as well, a move that has become controversial. But this may just be a teething hassle. This is the biggest spectrum auction with 72,000 MHz.
What is 5G?
5G, short for fifth-generation cellular technology, promises to rapidly increase wireless network speeds and data capacity. Data is the new oil, as Mukesh Ambani famously said. Data traffic is on the rise, estimated to grow by more than 60% every year. 5G is geared to handle this data explosion globally, including in India. Unlike 4G, 5G is capable of connecting multiple devices seamlessly and can reach a staggering 1 million devices per square kilometer. In India, 5G networks will run on mid- and high-end spectrum with 10 times higher speed and capacity than 4G networks.
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What does 5G mean to us?
Each new generation of mobile technology ushered in a revolution. Think about it: 1G made mobile voice calls possible in the ’80s; 2G introduced SMS in the 90s, 3G enabled mobile web browsing in the early 2000s; And 4G revolutionized the smartphone with its high data speed. Now, 5G promises to start a revolution of its own – a world that will resemble a tech utopia.
The 5G interface can connect practically everything to your phone through technologies like IoT and AI. From automated cars to smart cities to cloud robotics to remote surgery, 5G promises to make Hollywood sci-fi thrillers a reality. The explosion in real-time information could transform public services in the country, which have significantly improved health care facilities, law and order, traffic management, etc. With faster speeds and lower latency, 5G will delight entertainment-seeking Indians. their smartphone. There will be no disturbance in video calls, live streaming, real-time gaming etc. 5G could be a big bang moment for OTT networks in India, which will change the world of entertainment including the business of film production.
For the government, this will be an opportunity to bring more and more Indians on the information superhighway from 2014 through schemes like JAM (Jan Dhan, Aadhaar, Mobile), Digital India and Skill India. But let’s not run ahead of ourselves. There will be initial trouble before the 5G promises are fulfilled.
What does 5G mean for telecom companies?
5G launch will bring new existential challenges for telecom companies. They have been rediscovering pricing power with tariff hikes over the past year, and both Jio and Bharti Airtel removing and cleaning up their balance sheets. Even Vodafone India is in the midst of raising funds to continue operations and even bid for 5G auctions.
But here is the 5G challenge for telcos – how can they rapidly monetize 5G over the next few years without further eroding their balance sheets? While TRAI has cut the reserve price of 5G airwaves by 39% from the suggested price in August 2018, telcos were lobbying for a 90% cut. Auctions will be expedited only on base price 4.3 lakh crore.
The biggest worry for telcos is the government’s decision to reserve a portion of its 5G spectrum for private networks. It is expected to get a big thumbs up from businesses – from tech powerhouses to manufacturing giants, from logistics companies to hospitals and even educational institutions. A captive network would be restricted to the operation of that enterprise. But the telecom companies are getting sleepless due to this move. After all, enterprises are expected to churn out 30% to 40% of their 5G revenue.
The matter has come up with a face-off between the Cellular Operators Association of India (COAI), the body representing telcos, and the Broadband India Forum (BFI), a representative of tech giants like Amazon, Google and Facebook. COAI argues that “if private enterprises set up captive networks, there will be no viable business case for telecom service providers.” But the BFI has termed it only as a “misunderstanding”. Captive 5G networks are now a reality globally, with around 70 countries adopting the model, including the US, China, Japan and Germany. In this era of convergence, telecom services are no longer under the protection of telecom companies but are also an important input for businesses.
Can 5G replace 4G in India?
Free voice calls and cheap and high-speed data ensured the rapid spread of 4G in India. Almost the whole country has now adopted it. Can 5G also rapidly emerge as the technology of choice for most Indians? This may take some time. Telecom companies will price 5G services more than 4G. Unless, as some analysts suggest, they raise 4G tariffs to a level where they also offer 5G. In a price-conscious market, this could mean slow adoption of 5G by Indians. Also, it remains to be seen whether there will be a sufficient supply of 5G handsets in India initially. 5G phone shipments only reached 30 million in 2021, while India has over a billion telecom users.