5G in India Faces Strong Challenges but There Is Also a Way Out

The grimmest reality of the telecom industry still happens to be the strapped finances of the suffering telecom operators. The March auctions happen to be the prime witness of this fact, in which a measly 37% of all slots saw takers, while the rest of it remains unfettered. The infamous 700 MHz block still remains the highly prized possession of DoT but is seeing disinterest precisely because of its pricing.

Airtel’s deployment of 5 MHz of spectrum in the 1800 MHz band in Tamil Nadu is perhaps the most notable and recent development towards the usage of these much-revered natural resources. But even then, Vi and Reliance Jio Infocomm have decided to work on the infrastructure side rather than gathering and deploying spectrum. The fact again rests that the existing bands which the telco possess are enough to get them started on the 5G track but barely make the cut for a wide-spread service.

The telcos deem it fit to hibernate for now in terms of expenses on the spectrum and for the right reasons as more important financial issues plague their balance sheets.

The 5Gi Controversy

In November 2020, the International Telecommunication Union (ITU) had approved India’s Mobile Radio Interface Technology (RIT) called 5Gi. However, the industry stands opposed to the newly titled 5Gi standards alleging that it further complicates the compatibility of the 5G tech. The name in question is the 3GPP world standard which is to be adhered to by the telco industry currently. However, the ITU has remarked that the 5Gi would be a game-changer in the rural deployment of the network.

In such precarious times, a call for being on the same page seems imminent with the industry pressure mounting. Differing standards, whether they are on the software or hardware side, complicate matters unnecessarily for an industry that is already on its knees and is barely managing to get rolling with 5G.

The focus of the stakeholders should be on reducing the costs for the telecom operators and not enhancing them in the initial days. Complying with 5Gi might seem like a forward step for the network technology and might make for good wordplay, but the standard might also leave a lot of loopholes in the technology even before it attains a reliable image.

The Government Position

When it comes to the support from the DoT in terms of the 5G rollout, the most contentious point is the pricing of the spectrum. Bharti Airtel and Vi majorly have been proponents of lower prices, asking for a reduction of the 3,300-3,600 MHz price and 700 MHz bands by at least 50%. Not only this, but a payment moratorium and a cut in upfront payment also show up on the list of demands which telcos have chartered for the DoT.

With the expectations of a K-shaped recovery in the economy, even the government is maximising its chances of raking in more revenue. To pave up its fiscal deficit, the auction sales and disinvestment of PSUs seem to be the most legitimate means to attain that goal. The present government’s goal of Rs 2.5 lakh crore disinvestment seems to be dragging in the dirt, which is why all eyes are turned towards the very precious spectrum auction. This is also the reason for DoT’s reluctance towards non-reduction of the spectrum prices.

The present situation certainly calls for a wide-horizon view of the 5G technology, and every approach towards the launch and deployment of the tech should be seen with a long-term lens and not a myopic vision. The price reduction in the spectrum should be made fast, and Trai’s recommendations should be considerate of the industry realities and the telco balance sheets.

The Hardware Dilemma

While the industry and DoT are wrapped in their own tug of war, the third force in this game seems to be the hardware companies like Ericsson, Nokia and Huawei, which are certainly a big stakeholder in the 5G deployment.

Looking at the USA perspective, the banning of Huawei might be a diplomatic move for the west, but for India, it will not just be that. In an ailing industry like ours, the need of the hour is more competition to drive down prices and ensure efficiency for the telecom operators. Hence, it might be in the interest of the telecom industry to allow more hardware manufacturers into the market.

Lastly, I would like to say that while India will largely be a buyer of the technology in the initial days but combined with high demand and an expansive user base, the tide might turn in our favour on a long enough timeline. Techno-diplomatic alliances with other countries like France, Japan and Russia will further boost our capabilities and will likely balance out concerns about the Chinese domination of the market. The use-cases of healthcare combined with 5G will be a formidable force in the times to come as government’s try to invigoratively reform health services across the world, and that’s why India’s presence in the world 5G game is all the more necessary.