The Adani Group recently announced that it would be entering the telecom sector by participating in the 5G spectrum auction of 2022. According to the analysts, Adani Data Networks has already bid for 5G airwaves. But Adani Group is only focusing on enterprise services with 5G. Consumer market business is still a far reality for the Adani Group. It is very much understandable as well because the industry experts also believe that 5G revenues from consumers would be very low or negligible compared to the revenues that the companies will make post the launch of services.
The thing is, Ashwini Vaishnaw, the telecom minister of India, believes that there is scope for the entry of a new player in the telecom sector of India. As per ET Telecom, Vaishnaw made comments on how the average data consumption in India is more than the global average and how there are a billion users in the country.
New Regulatory Framework Required
The telecom minister talked about the need for a new regulatory framework. Vaishnaw said that the Indian telecom sector is now implementing new-age technology. But these new-age technologies are being governed through the laws that were made almost four decades back. It doesn't make sense, and it would never allow the Indian telecom sector to go forward.
For the unaware, the Department of Telecommunications (DoT) has already released a consultation paper on the need for a new regulatory framework in the Indian telecom sector. It is high time for India to formulate a new regulatory framework as connectivity with 5G is absolutely at a different level and manner than all the previous generation network technologies.
Is Indian Telecom Sector Now at a Sweet Spot
Well, there's a simple answer to this - the telcos can't complain any further after what the government has already done for it. While it is understandable that the telecom sector is the lifeline or the backbone of the digital economy that the Modi government is trying to make, there's a certain limit till which the budget can be extended towards the telecom sector to help it.
The government has announced multiple relief measures addressing liquidity concerns for the telcos. The Department of Telecommunications (DoT) is already working on more relief measures that would ensure that there is an ease in conducting business for the telcos.
If the average revenue per user (ARPU) levels of the industry go up further, and if the new set of the regulatory framework is a boost for the sector, we might see new players jumping into the Indian telecom sector. Adani Group, which is already there now, can expand into providing services to consumers. But going by the words of the telecom minister, we might see more new players.