Why could India’s 5G rollout be at risk?



While the government appears determined to roll out 5G services in India, telecom operators have opposed any move to set aside spectrum for captive private networks at an administered price.

They argued that such a move would be a game changer. On the other side of the fence are supporters of private networks like Tatas, ITC and the Broadband India Forum, which counts among its members major global players in technology.

They argued that assigning spectrum directly to companies is the only way to make Industry 4.0 a reality.

Now, the final blows in this battle over 5G captive private networks have been dealt.

In a move that could jeopardize India’s upcoming 5G spectrum auction, the Cellular Operators Association of India sent a rather blunt letter to Communications Minister Ashwini Vaishnaw on Wednesday. The letter said there would be “no business case for deploying 5G networks” if captive private 5G networks were allowed.

COAI is the apex body of telecom operators with Reliance Jio, Bharti Airtel and Vodafone Idea as key members. COAI clarified its position: allowing independent entities to set up private captive networks with direct assignment of 5G spectrum would have a “serious” impact on revenues and degrade the business case for 5G for telecom operators. It could even force telecom operators to revise their 5G spectrum strategy, although most say they are unlikely to back out of the auction altogether.

The COAI letter said that wherever 5G has been deployed, there have been virtually no revenue gains from the retail segment. Instead, improved revenue and efficiency can only happen in the enterprise segment, which involves the use cases that an enterprise might instead encounter with its captive private network if it is allowed there.

Telecom operators said that, based on global trends, 40% of 5G revenue comes from the enterprise segment. They fear losing that revenue share

Telecom operators have also made other arguments against the direct allocation of 5G spectrum through administrative channels to companies for private captive networks.

They said such a move would give a doorway to private companies, remove a level playing field and rob the government of valuable revenue.

Telcos decided to take strong action after it seemed possible that the DoT could, in its memorandum for cabinet approval, allow corporations to operate captive private wireless networks, as previously recommended by the Security Authority. telecommunications regulation of India. If that happened, it would be a complete about-face.

Talk to Trade standard, Lt Gen SP Kochhar, DG, COAI, says government will lose revenue due to lack of auctions. Administrative attribution would contravene SC guidelines. Companies will likely outsource the setup of private networks. This could allow an unlicensed entity that did not participate in the auction to become a telephone company. Such an entity would also not be subject to the regulations intended for telecom operators.

Tech companies have fought back. On Thursday, the Broadband India Forum, or BIF, fought for the direct allocation of spectrum to private 5G networks for a nominal administrative fee.

Contrary to the position taken by telecom operators, BIF argued that the position that private 5G networks would lead to lost revenue for telecom operators was a “misconception”.

BIF argues that indoor private campus networks do not reduce the legitimate revenues of telecommunications operators. According to the industry body, an efficient captive network via private 5G would lead to increased business productivity. This would help to expand business activities and external communications, which in turn would lead to better revenues for telecom operators.

The BIF argued that most revenues generated by telecom operators are external and remain untouched, and therefore government revenues also remain protected. Private networks are an additional source of revenue for telecom operators and the government, he said.

There would be no revenue loss for the government due to the direct allocation of spectrum for private 5G networks to companies, as they will purchase the spectrum at a price which will be set by the government and allocated administratively.







Debashish Bhattacharya, Senior Deputy Managing Director of the Broadband India Forum, says private 5G networks are non-public networks. It is limited to a local area and has only one potential user in that given area. You can’t have auctions when there’s only one user, he says. It is misrepresented that SC demanded that spectrum could only be allocated through auctions, he adds. SC said auctions could be the best way to maximize revenue. The Supreme Court also said that maximizing revenue may not always be the best way to serve the public good. The digitization of all industries towards Industry 4.0 is the public good in this case. Additional license fees and spectrum usage fees paid by private networks will increase government revenue.

The Business Standard Morning Show previously reported that the 5G spectrum auction is expected to see a muted response from telecom operators due to their unmet pricing concerns. This could be a reason for the slowdown in 5G rollout in India, or at least lead to an uneven distribution of 5G services. The fight over private captive networks will only add to the list of obstacles to deployment.

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