5G Rollout: Telcos VS Big Tech Cos

SANSAD TV - Discussion May 19, 2024 106 Add to Reading List

The Union Cabinet recently approved the auction of the spectrum needed for 5G services. A total of 72,097.85 MHz (or 72 GHz) of spectrum will be available for a 20-year period. This auction is planned for the end of July 2022.

The government has also allowed big tech companies to create their own private 5G networks. However, telecom companies are against the idea of giving these companies spectrum at a set, lower price for their private networks.

What is 5G Technology?

About:

5G is the fifth generation of mobile networks, succeeding the previous 1G, 2G, 3G, and 4G networks.
It introduces a new global wireless standard, designed to connect nearly everyone and everything, including machines, objects, and devices.
Internet speeds in the high-band spectrum of 5G have been tested to reach up to 20 Gbps (gigabits per second), while the highest recorded internet data speed in 4G is typically 1 Gbps.
In India, the Satcom Industry Association-India (SIA) has expressed concerns about the government's plan to include Millimetre Wave (mm Wave) bands in the 5G spectrum auction.

Bands in 5G:

5G operates primarily in three bands: low, mid, and high-frequency spectrums, each with its own benefits and limitations.
Low-band spectrum: This band excels in coverage and data exchange speed, though the maximum speed is capped at 100 Mbps (Megabits per second).
Mid-band spectrum: While it provides faster speeds than the low band, it has restrictions in coverage area and signal penetration.
High-band spectrum: This band offers the highest speeds among the three but has very limited coverage and weak signal penetration.

What will be the Significance of 5G Rollout?

Useful Across Three Main Connected Services: 5G is broadly applied across three key types of connected services: enhanced mobile broadband, mission-critical communications, and the massive Internet of Things (IoT).
Enhanced Mobile Broadband: Besides improving smartphone performance, 5G technology can facilitate new immersive experiences like Virtual Reality (VR) and Augmented Reality (AR) with faster and more consistent data rates, lower latency, and reduced cost-per-bit.
Mission-Critical Communications: 5G can enable innovative services that can revolutionize industries with ultra-reliable, low-latency connections for remote control of vital infrastructure, vehicles, and medical procedures.
Massive Internet of Things: 5G aims to connect a vast number of embedded sensors in virtually all devices, scaling down data rates, power, and mobility to provide highly efficient and low-cost connectivity solutions.
Fourth Industrial Revolution: Together with IoT, cloud computing, big data, Artificial Intelligence, and edge computing, 5G could be a crucial driver of the fourth industrial revolution.
Smooth Governance: 5G technology is expected to enhance the governance of the country, improve ease of living, and streamline business operations, increasing convenience and creating numerous employment opportunities.

What will be the Challenges Regarding 5G Rollout?

Low Fiberization Footprint: Enhancing fiber connectivity across India is crucial for efficient 5G adoption. Currently, only 30% of India’s telecom towers are connected, and this number needs to double for a successful 5G launch.
‘Make in India’ Hardware Challenge: Restrictions on certain foreign telecom Original Equipment Manufacturers (OEMs) pose a significant obstacle as much of the 5G technology development relies on them.
High Spectrum Pricing: India's 5G spectrum pricing is significantly higher than the global average, straining cash-strapped telcos and hindering widespread adoption.
Choosing the Optimal 5G Technology Standard: The debate between the homegrown 5Gi standard and the global 3rd Generation Partnership Project (3GPP) standard needs resolution to accelerate 5G implementation. While 5Gi offers advantages, it also raises launch costs and interoperability concerns for telcos.
Enabling Critical Infrastructure: Implementing 5G requires fundamental changes to the communication system's core architecture, particularly addressing its limitation in carrying data over long distances. Augmenting infrastructure is essential for a smooth transition.
Financial Liability on Consumers: Upgrading from 4G to 5G technology imposes a financial burden on consumers as they need to invest in the latest cellular technology.
Capital Inadequacy: Telecom companies like Bharti Airtel and Vodafone Idea face capital inadequacy issues, delaying 5G spectrum allocation due to insufficient cash flow and capital reserves.

Why is 5G Spectrum a Setback for Telcos?

Main Concerns:

The primary concerns revolve around the methodology of allocating spectrum to non-telcos, the pricing of this spectrum, and the specific bands that will be allocated.

Impact on Revenues:

The Cellular Operators Association of India (COAI) has expressed concerns that allowing independent entities to establish private networks with direct 5G spectrum allotment would significantly harm telcos' revenues and undermine the business case for 5G.

Increased Competition:

Telcos, having acquired expensive 5G airwaves through auctions, may struggle to compete with tech companies on enterprise network deals, as the latter may obtain coveted airwaves at a nominal fee from the government.

Limited Applications:

Telcos argue that allotted spectrum should be reserved for Machine-to-Machine (M2M) applications only, rather than allowing private networks in areas considered public, such as large residential townships set up by corporations for their employees.

Challenges with Infrastructure:

Telcos also raise concerns about electromagnetic frequency regulations, anticipating increased tower density due to 5G rollout. Setting up new towers may face challenges as a result.

Conclusion:

To ensure the successful rollout of 5G in India, several key steps must be taken. Firstly, there needs to be a rationalization of spectrum pricing to balance revenue generation for the government with affordability for telecom companies. The government's role is pivotal in managing spectrum design and supporting telecom companies in deploying sustainable and affordable networks.

Additionally, bridging the rural-urban gap through the deployment of 5G at different band spectrums is essential for inclusive connectivity. Furthermore, enabling the domestic manufacturing sector in India will not only benefit users but also position Indian manufacturers as global players in telecommunications.

Collaboration between telcos and enterprise customers is crucial for leveraging 5G capabilities and addressing emerging challenges. However, concerns over spectrum pricing may result in a muted response from telcos in spectrum auctions, potentially slowing down the 5G rollout. Therefore, addressing these concerns and fostering collaboration between stakeholders is imperative for a successful and widespread adoption of 5G technology in India.