The Department of Telecommunications (DoT) has recently issued a fresh study for understanding the demand potential for direct allocation of spectrum to companies for setting up private 5G networks. Telcos have long opposed this idea. The investments made by the telcos for setting up 5G networks across India is in the tune of several thousand crores. For the telecom operators, private captive networks are one of the best use cases for 5G monetisation. While enterprises have been rooting for direct allocation, the DoT last time concluded the device ecosystem is simply not ready. However, it has been a long time since then.
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Thus, the telcos could potentially find themselves in a position where they need to again go against the DoT's idea of direct spectrum allocation to enterprises for setting up private 5G networks.
"During the time of spectrum auction, the quantum of spectrum and its valuation were benchmarked, keeping in mind that the licensed access service providers of networks will be meeting the demands of private 5G spectrum by enterprises," said Lt. S.P Kocchar, director general, Cellular Operators Association of India (COAI).
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Telcos won't back down from their stance. If major enterprises start getting spectrum allocation for setting up private 5G, it will hurt the revenues of the telcos. Further, the telcos had priced their investments in such a manner where they had anticipated someday monetising private 5G. If that doesn't happen, it will hurt their revenue projections and RoI (return on investments) from 5G.
Who will win this war, we don't know. But we would like to highlight one more area where spectrum allocation is a key concern for the telcos. It is the satcom (Satellite Communications) industry. Some interesting decisions will be taken in the near future, so stay tuned to be updated!
