The Indian telecom operators are struggling to monetise 5G networks. While mobile customers are essentially getting it for free, enterprises haven't yet shown much demand for it. Even at the enterprise level for 5G, the use cases are quite limited. There's not enough leverage to push enterprises into adopting 5G instantly. However, once the government gives the green flag to the telcos for leasing spectrum to the enterprises for setting up 5G private networks, that may help the telcos boost their revenues.
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Enterprises in India are allowed to get spectrum from a telecom operator for setting up private networks. Very soon, the Department of Telecommunications (DoT) will notify the rules around the leasing of spectrum to private networks, according to an ET report. Once this is done, telcos will have a new way to earn revenues. While this is monetising the 5G spectrum and not directly earning money through the 5G network services, it will still be a relief for the telcos as soon as they can start earning additional revenues through this.
The report mentioned that the revenues that will be generated by a telco by leasing 5G spectrum will be counted in the gross revenue of the operator. This means that it will be subject to dues for license fees. Jio and Airtel have rolled out 5G in most of the country and they will look forward to being able to lease spectrum to enterprises for setting up Captive Non-Public Networks (CNPN). Telcos can also directly set up the private network for an enterprise to earn revenues.
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Private 5G networks can help with enabling smart manufacturing, smart logistics and more. Telcos will have to notify the govt each time they lease spectrum to a party that holds CNPN license. Further, the private network operator will have to get clearance from the standing advisory committee on frequency allocation (SAFCA) before starting operations.
