Consultancy company Deloitte India believes that Indian mobile operators may delay the launch of 5G network due to several reasons.

The launch of 5G may be delayed due to several challenges. Capital expenditure (Capex) is a key challenge with the high sector debts. It is expected that an investment of $60-70 billion will be needed for 5G.

Recently, COAI’s director general Rajan Mathews said that telecom operators will be cautious about the forthcoming spectrum auction if the India government is going to sell 5G spectrum along with the other airwaves for high speed Internet in India.

The pathetic 4G coverage – despite investment from Reliance Jio, Airtel, Idea Cellular and Vodafone – can be yet another reason for the delay in 5G.

The slow adoption of 4G can be another reason for delay in 5G roll-outs. Penetration of 4G as of March, 2017 reached 12 percent and is expected to reach just 40 percent by 2022, according to  Deloitte India that presented a report at the India Mobile Congress (IMC) 2017.
For 5G to proliferate in India, operators need to overcome existing financial stress. Also, LTE-A and LTE-A Pro will be very critical in preparing for 5G and hence provisioning of billions of connected devices.

Telecom investment in India

For urban broadband, private players are recommended to lay down a progressive plan to fiberize 77-80 percent of tower assets (currently only 30 percent sites are fiberized in major cities) from FY17-FY20.

It is estimated that an investment of $8 billion would be required from FY17-FY20 to lay fiber in key towns. The government should primarily play the role of a facilitator to support the funding, with ownership being borne by the telecom and infrastructure players.

The failure of NOFN project is resulting into poor broadband network in India. As of 6th August, 2017 OFC for 100, 443 GPs has been laid and approximately 28,000 GPs have been lit (GPON integrated and tested).

Approved in 2011, the project aims to connect 250,000 gram panchayats (GPs) via the optical fiber network. Universal Service Obligation Fund (USOF) with an investment of $3 billion will fund the Internet network project.

The NOFN project is facing challenges in implementation due to complexities such as low investment in fiber networks, poor usability of existing fiber networks because of fiber cuts, lack of proactive coordination among stakeholders, etc.

Currently, 25 percent of cellular data traffic is being offloaded through Wi-Fi and small cells in India. This proportion is expected to go up to 50-60 percent in India as data use increases exponentially. In developed markets, revenue from small cells offerings forms a significant proportion of overall revenues of tower companies.
It is estimated that currently there are 50 million hotspots globally and the number is expected to grow to 340 million by 2018. France, US, and UK lead the Wi-Fi hotspot deployment with 13 million, 9.8 million, and 5.6 million hotspots respectively. The business models being used include having revenue-share agreements with venue owners.

In India, there are 31,000 Wi-Fi spots as of March 2016 and are expected to grow to ~200,000 by 2018. Most Indian telecom providers set up Wi-Fi through custom deployments in business parks, etc. Google has deployed Wi-Fi spots in partnership with RailTel at 400 railway stations; Facebook too in partnership with BSNL is planning to set-up community Wi-Fi spots in rural India.