India’s telecom operators may have lost the battle, but can they still win the war? On Wednesday morning, as the Union cabinet cleared the much-delayed 5G Spectrum auction that will finally kick-start the new generation high-speed network service, the telecom biggies have much to celebrate, and much to rue.
The plea of telecos for reducing the reserve price by 90 per cent has gone unheeded, though this was expected after TRAI’s slashing of prices by 39 per cent two months ago.
Worse perhaps would be the issue of private captive 5G networks. For the past several weeks, major operators like Airtel and Reliance Jio had voiced vehement opposition to the proposal from the likes of Tata Consultancy Services who had asked for allocation of 5G spectrum directly to the company to run its own private 5G enterprise network. The telecom sector regulator TRAI had also backed this.
One of the reasons for the delay in cabinet decision on Spectrum auction — many countries, from South Korea to Thailand and Malaysia, have already rolled out the service — was this turf war between telcos and those who wanted private 5G networks for their businesses.
Cellular Operators Association of India (COAI), which has all the three major private networks—Jio, Airtel and Vi (Vodafone-Idea)—as members, had a few days ago, urged the government “not to reserve or de-license any spectrum which has been identified or likely to be identified for use of IMT/ commercial services for Private Captive Networks.”
It amounts to undue advantage to private commercial entities at the cost of government exchequer, COAI had said.
The telco body also warned that private captive networks can be detrimental to national security.
The Modi government obviously does not agree, even though the telecom ministry, caught in the muddle, had kept postponing putting the 5G spectrum auction matter in front of the Union cabinet for weeks — until today.
For telcos, enterprise business, or in other words, providing service to big corporations and factories for their use is a lucrative revenue stream. With large private enterprises allowed to bid for their own Spectrum, this would mean that some of the best revenue earning options for the telcos is now out of hand.
There is also the worry that the high cost may deter many of the individual customers in the initial days and months of 5G rollout. The hopes of making it up through private networks now seem uncertain.
However, experts feel it is a positive outcome. “To boost technological advancement, the government has also announced development of private networks which will pave the way for Industry 4.0 applications,” said Peeyush Vaish, partner and telecom sector leader with the consultancy firm Deloitte India. “(This) will open up newer avenues for deeper penetration and access and rich user experience via consolidation.”
