The recent research reports indicate that India telecom operators will take 5-6 years or more to derive gains from their investment in 5G spectrum and 5G technology.
The investment sentiment among Indian telecom operators such as Bharti Airtel, Vodafone Idea, Reliance Jio and BSNL also shows lack of demand for 5G services.
At present, there is no research report available to show the future demand for the high-speed 5G services among retail and enterprise customers in India. Before analysing the demand for 5G speed, Indian stakeholders will be looking at the 4G LTE speed offered by Indian telecom operators and the impact on ARPU.
The much-hyped 4G services did not bring enough support to mitigate the financial burden of telecom operators. In fact, ARPU has started deteriorating in the wake of competition from Reliance Jio, the latest entrant in the Indian telecom market.
“The remainder of fiscal 2019 may not witness active participation in 5G spectrum auctions due to other Capex priorities, an immature ecosystem for 5G and stretched leverage profile. Any disruption from 5G is therefore unlikely in the near term,” India Ratings analysts Tanu Sharma and Prashant Tarwadi said in a recent research note.
The main concern among business leaders at telecom operators is the demand for the 5G use cases illustrated by telecom equipment vendors.
5G technology is to expected power on-demand virtual reality (VR) and augmented reality (AR) experiences, driverless vehicles, medical monitoring, advanced industrial automation services, and other applications – all requiring ubiquitous, low-latency connectivity, says Nokia, the Finland-based telecom equipment maker.
Telecom analysts are arguing that 5G use cases are not presently suitable for the telecom 900 million plus customers in India. 4G launched for more than 50 percent of the population did not bring any exciting experience to enterprises, while retail customers received some raise in speed due to competition. The promoters of 5G will soon start talking about the speed and other benefits.
Top research firms or industry associations do not consider India as the top 10 markets for 5G going by the current investment plans of Indian mobile operators.
But AJ Paulraj, professor, Stanford University, and chairman of a high-powered committee on India’s 5G road-map, says India will make investments of $100 billion over next 5-7 years to create nationwide 5G infrastructure.
Indian telecoms are still learning from their mistakes in investment in telecom infrastructure – 3G and 4G. Mobile operators delay investments due to lack of strong potential to grow their revenue.
Idea Cellular has made just $140 million investment in June quarter of 2018 in telecom infrastructure – mainly on 4G networks – during the peak of the competition with Airtel and Reliance Jio.
At present, Vodafone and Idea Cellular are silent about their 5G investment plans in India. BSNL, Airtel and Reliance Jio will be gearing up for 5G as and when spectrum and devices are available for nationwide launch. But most operators are not even preparing for their IoT business that will boom with 5G.
GSMA says mobile operators in Asia will invest almost $200 billion over the next few years in upgrading and expanding their 4G networks and launching new 5G networks. Asia will be the largest region for 5G subscribers – driven by Australia, China, Japan and South Korea – by 2025.
The latest TRAI recommendation on 5G spectrum pricing may be a good news for operators. But India does not want to make investment in 5G spectrum now. India Government is yet to make any official announcement on the next round of spectrum auction.
5G uses for mobility
5G will power autonomous vehicles on the road. Intel and Qualcomm, among others, are going to drive this. Juniper Research says there will be over 50 million autonomous vehicles on the road, with over 10 million in the US and 15 million in the Far East and China — by the end of 2026 or after nearly 8 years.
Leading nations in Juniper’s Autonomous Vehicle Country Readiness Index 2018 are: US,Singapore, Japan, UK, South Korea, The Netherlands, Malaysia, India, China and France. This indicates that India will be one of the drivers of autonomous vehicles powered by 5G in 2026.
Gartner says 5G networks will be 10 times more efficient than 4G networks. CSPs can secure future market opportunities with manufacturers of autonomous vehicles (AVs) in the fields of driver safety and data processing and management.
AVs will upload over 1 TB of vehicle and sensor data per month to the cloud by 2025. This is up from 30 GB from advanced connected cars in 2018.
“CSPs must act now to secure future market opportunities by ensuring that 5G is part of the AV design process. OEMs will need comprehensive end-to-end data solutions to streamline their management of data connectivity, storage and analytics,” a recent Gartner report said.
Considering the low marketing activity by augmented reality (AR) and virtual reality (VR) headset vendors in India, usage of 5G will be a distant dream for the consumers of AR and VR markets as well.
IDC said worldwide shipments of AR and VR headsets fell 30.5 percent to 1.2 million units in the first quarter of 2018.
IDC forecasts the overall AR and VR headset market to grow to 8.9 million units in 2018, up 6 percent from the prior year. AR and VR headset market will be reaching 65.9 million units by 2022. IDC forecasts VR headsets to grow from 8.1 million in 2018 to 39.2 million in 2022, representing a five-year CAGR of 48.1 percent.
The IDC report on AR / VR does not talk about the potential of India. If Indian enterprises are not yet ready to make investment in AR / VR space, making investment in 5G will not bring additional revenue streams to mobile operators in India.