The 5G Bottleneck: A Bumpy Road Ahead? The telecom operators in India are contesting the demand of tech companies who want the government to directly allocate 5G spectrum to private enterprises
Opinions expressed by Entrepreneur contributors are their own.
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
India is on the cusp of a 5G boom and the final roll out is in its last stages of development. The government is planning to come up with the 5G auction in the later half of 2022. However, even before the bids are called, a war of words has ensued between the telecom operators and the tech giants. Traditionally, telecom companies buy spectrum in auctions and roll out networks. In the current scenario, the telecom operators are contesting the demand of tech companies who want the government to directly allocate 5G spectrum to private enterprises.
The telecom operators such as Reliance Jio, Airtel, Vodafone-Idea are pitting against Telecom Regulatory Authority of India's (TRAI) decision to consider tech companies such as Tata Consultancy Services (TCS), Google, Amazon, Cisco for the deployment of captive business networks.
The Cellular Operators Association of India (COAI), an advocacy group for the telecom industry, said in a statement, "There is no need to alienate spectrum directly to companies for captive private networks. The licensed access service providers are fully capable of providing all customized solutions, including M2M/ Industrial 4.0 services in the most competitive and economic manner, and are providing such network configurations to private and public sector entities."
The move comes close to the heels of an announcement made by TCS, the information technology company. It recently asked the government to allocate 5G spectrum to private enterprises, as recommended by TRAI.
Earlier, the Broadband India Forum (BIF), industry body for tech companies, stated–with efficient private networks–enterprises would increase productivity, which will open enhanced revenue streams for the telcos. In a letter to the government it said, "Captive usage in the current situation would only contribute a minor share in processes/applications like robotics, automation, etc, due to challenges in delivering the required SLAs (service level agreement) through public networks. Therefore, the speculated loss in revenues for telcos via enterprise services is a misplaced one."
What telcos fear
The telcos fear that such a move will give a backdoor entry to private companies, truncate the revenues of licensed telcos, rob the government of valuable revenues and create a non-level playing field. Flagging concerns against Trai's recommendation on 5G spectrum for private enterprise networks to be assigned administratively on demand through a publicized online portal-based process, the Telcos said such a proposal could potentially rob telcos of their future 5G enterprise business revenues, estimated at around 40 per cent of overall 5G business revenues and destroy the 5G business case in India.
How it started & where It's going?
By the beginning of 2021, 61 countries had commercial 5G networks. The 5G network in India first came into the scene in 2017. A high-level forum was set up by the government to chalk out a roadmap towards a 5G India by 2020. Subsequently, technology companies were called to conduct major trials and devise a framework related to 5G applications and use cases.
Today, if the standoff is not resolved at the earliest, it will deter the 5G roll out and further push India behind other countries in the game.