While telecom operators in India are not interested in participating 5G spectrum auction, analysts now predict that the government itself will have a tough time in auctioning the ‘costly’ 5G spectrum. An ET Telecom report says the government will likely face difficulties in selling the 5G spectrum because of Coronavirus. A few months ago, the DoT approved all the vendors to participate in 5G trials in India, including Huawei. With the Coronavirus outbreak in China, telecom gear makers will face difficulties in manufacturing the required 5G gear. Telcos were bullish on the fact that they do have other vendors like Ericsson and Nokia, which will help in 5G rollout, but Chinese makers like Huawei and ZTE are leading the 5G deployment race.
5G Launch in India Will Face a Potential Delay
The government is planning to conduct the next spectrum auction in Q1 FY21, where it will auction both 4G and 5G airwaves. However, with the ongoing Coronavirus outbreak in China, the business case will likely to be spoiled and it will put already struggling telcos to stay away from the auction.
“If the coronavirus menace continues for a few more months, the government may find it challenging to auction expensive 5G spectrum before January-February 2021 since a prolonged epidemic would hit 5G network deployments and devices availability in India too, further reducing the business case for local telcos to participate meaningfully in any early 5G airwaves sale this year,” Rajiv Sharma, research head at SBICap Securities said to the publication.
In addition, the production of 5G telecom gear will be affected in China, due to which the rollout may further get delayed. Huawei is actively working with Indian telcos Bharti Airtel and Vodafone Idea for deploying new network technologies. Even without Coronavirus, 5G rollout in India is expected to be delayed as telcos are reeling under heavy debt with the fresh setback being given by the Supreme Court regarding AGR dues.
Telcos Say Coronavirus Will Not Impact 5G Rollout in India
Analysts predict that Coronavirus will be a massive threat for 5G rollout not only in India but globally as well. However, the Cellular Operators Association of India (COAI) which represents private telcos like Bharti Airtel, Vodafone Idea and Reliance Jio vouched that the 5G rollout will not be delayed as they have deals with non-Chinese telecom gear makers as well. However, COAI said that 5G smartphone business might be impacted in India and globally.