India 5G Delayed due to spectrum sale and lack of fiber connectivity

The Indian government expects initial “5G” rollouts by late 2020. But sector experts say the country is running late and could be at least three years behind South Korea, Japan, Australia, the US, China, France and Germany in rolling out 5G networks. Pre IMT 2020 standard 5G services are likely to be rolled out in those markets by late 2019 or early 2020.

Some of the key reasons why India is slipping behind in 5G – after having missed the 3G and 4G early adoption train – include dismal state of fiber network infrastructure (needed for backhaul), absence of relevant use-cases and a very modest presence of household electronics plugged into the Internet.

Financial stress in the industry and a missing handset/mobile device ecosystem have already delayed a 5G spectrum sale to late 2019.

Further, high debt levels and the prospect of high reserve prices could further kill the appetite of telcos even when 5G airwaves are auctioned, especially for older carriers such as Vodafone Idea and Bharti Airtel, whose India operations remain in the red, say experts.

Problems related to setting up and maintaining fiber networks and poor 4G Internet availability in the villages and small towns, they say, could further scale down the business case for early 5G rollouts in India. 5G smartphones won’t come to India before 2020, although they will be available in early adopter markets next year (again, pre-standard and likely based on 3GPP release 15 5G NR).

Sunil Mittal-led Bharti Airtel said recently that the current wave of popular 5G use-cases such as “driverless cars to remote surgery are not practical in the Indian context,” which is why it expects deployments are four years away. He also said the company is in no hurry to bid for 5G spectrum.

Experts say a major deterrent to India’s 5G ambitions is lack of adequate fiber connectivity – less than 20% of the country’s telecom towers are linked by fiber. This can limit the capacity to connect the core of a mobile network to nodes and then on to towers for transmitting data. A reliable fiber-based network is critical to support 5G data speeds of 10 Gbps and next-gen applications such as video-on-demand and internet of things (IoT) to smart cities.

“If 5G is to succeed in India, at least 70-80% of mobile towers will have to be fiberised, failing which, severe data speed limitations will continue as present backhaul networks in India use microwave spectrum,” says TR Dua, director general of Tower & Infrastructure Providers Association, an industry grouping representing Indus Towers, Bharti Infratel, American Tower Corporation, GTL, Reliance Infratel and Tower Vision.

TV Ramachandran, president of the Broadband India Forum, agrees, saying, “Most 5G use-cases would fall if we don’t provide strong fibre connectivity.” The forum counts Huawei, Qualcomm, Facebook, Google, Microsoft, Hughes and Intel among its members.

In comparison to India, China already has 75-80% of its mobile towers fiberised.

Moody’s Investors Service expects China to commercially deploy 5G services in late-2019 or by 2020, with pilot trials already under way. The Chinese government allocated 5G spectrum this month to the country’s top 3 telcos – China Mobile, China Unicom and China Telecom – to conduct field trials in the run-up to the commercial rollout of 5G services.

By contrast, India’s telecom department said that the 5G spectrum sale would take place in the secondhalf of 2019. It though recently invited telcos, equipment vendors and other stakeholders to partner with the government for 5G trials. Sources say trials are still some time away.

Nitin Soni, director (corporates) at global rating company Fitch, does not expect 5G to arrive in India before 2022 at the earliest because the telecom industry balance sheet – saddled with Rs 7 lakh crore in debt – is in no shape to support a 5G spectrum sale in the next one year.

“Even if 5G spectrum is auctioned by late-2019, I don’t foresee enthusiastic bidding, especially if reserve prices are high as older carriers are still struggling. Besides, India is nowhere near having ubiquitous fibre connectivity or a devices ecosystem comparable with China or Korea, which could delay 5G rollouts by another three years,” says the Singapore-based Fitch director.

Rajan Mathews, director general of the Cellular Operators Association of India, which represents Vodafone Idea, Bharti Airtel and Reliance Jio Infocomm, says the primary reason South Korea, Germany, Japan or the UK have been able to brace for 5G early is due to the strong “financial condition of their telecom operators.”

The reserve price of 5G spectrum recommended by India’s telecom regulator, he said, “is much higher compared to Germany, South Korea or UK.”

In August, the Telecom Regulatory Authority of India (Trai) set Rs 492 crore per unit as the minimum rate for 5G spectrum (in the 3.4-3.5 GHz bands), compared with Rs 131 crore per unit and Rs 66 crore per unit in South Korea and the UK, respectively.

A key global learning, Rajan says, is “pricing the spectrum at reasonable rates” to allow telcos to bid aggressively and roll out 5G services.

Fitch’s Soni says China has stolen a march over India as “it’s streets ahead in developing data-intensive 5G content coupled with music, movie and sport apps in regional languages,” which is slated to drive consumption once 5G services get rolled out there.

Experts also say that unlike India, China already has a buzzing internet of things ecosystem, wherein cars, machines and ordinary home appliances are plugged to the internet, providing the perfect springboard for 5G to rapidly gain traction.

The Modi government, though, doesn’t want India to miss the 5G bus – like the country did on 3G and 4G – as the economic impact alone of this superfast wireless broadband technology is estimated at over $1 trillion by 2035.

The government has set up a highpowered 5G Forum to advise on the path forward, which has suggested that most rules on regulatory matters be promulgated by next March to pave the way for early rollouts.

US chipmaker Qualcomm has downplayed concerns around 5G ecosystem challenges, saying that although the global infrastructure ecosystem is diverse, the vendors overseas and in India are the same.

“Different countries are at different stages of mass deployment of fibre and so on,” says Durga Malladi, senior vice president, Engineering & GM (4G/5G), at Qualcomm Technologies.



Reliance Jio president Mathew Oommen told ETTelecom: “For service providers, just voice or even traditional data revenue alone is not going to be the cure. They have to invest and innovate so that they would not get displaced by other aggressive providers or more importantly by OTT companies.”

India telecom market leader Reliance Jio, second ranked Bharti Airtel and financially stressed Vodafone Idea (Vi) have filed applications for participation in the upcoming 4G spectrum auctions, due to start on March 1. The auction for over 2300 MHz of airwaves—valued at Rs 3.92 lakh crore at base price—though is likely to see limited bidding intensity for spectrum worth less than Rs 48,000 crore, with Jio and Airtel expected to be the main players. Industry executives have confirmed to ET that the three telcos have filed in their applications although Airtel, Jio and Vi did not respond to ET’s queries.


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7 thoughts on “India 5G Delayed due to spectrum sale and lack of fiber connectivity

  1. In my opinion, the pre-IMT 2020 standard 5G networks (both mobile and fixed “fake 5G”) will have few takers in 2019 and network operators deploying them will lose a lot of money. Hence, India’s delay in deploying 5G networks will not be a bad thing at all!

    Those “fake 5G” networks will all have to be redesigned and re-architected after the ITU-R and ITU-T 5G standards have been completed in late 2020 or early 2021 (3GPP Rel 16 three month slip). It could be a forklift upgrade, depending on the final IMT 2020 standard for Radio Interface Technology (RIT) chosen by ITU-R WP 5D and the non radio related IMT 2020 standards being progressed by ITU-T.

  2. RCom initiated contempt proceedings in the apex court against the India Department of Telecommunications, blaming it for delaying a spectrum sale that would have enabled dues to be paid to Ericsson and lenders.

    Ericsson filed its second contempt petition in the Supreme Court against Reliance Communications’ Chairman Anil Ambani, asking that he be detained in civil prison and be barred from travel overseas unless he ensures payment of Rs 550 crore owed to the Swedish company.

  3. The advent of 5G services in India will bring about a paradigm shift in technology and open up more opportunities for everyone in the digital space, India Telecom Secretary Aruna Sundararajan said Friday January 18th. Field trials of 5G services are expected to start next month.

    “This (5G) is going to be another big paradigm shift that is going to happen,” Sundararajan said at the IAMAI India Digital Summit in New Delhi.

    “People are gearing up for the next big paradigm that is about to come. All this will open up even more opportunities for everyone working in the digital space,” Sundararajan added.

    The government plans to hold 5G spectrum auction in the second half of this year.

    Industry players, however, have said the auction should be deferred given the financial stress in the sector and also demanded lowering the price of the airwaves.

    The Telecom Regulatory Authority of India (Trai) has recommended auction of about 8,644 MHz of telecom frequencies, including those for 5G services, at an estimated total base price of Rs 4.9 lakh crore.

  4. Telcos must bravely invest in 5G airwaves: Huawei India CEO

    Huawei India CEO Jay Chen says telcos must strongly invest in 5G spectrum once it’s available in India, failing which they run the risk of being left behind in a mobile broadband turf where the competition benchmark has shifted from affordability to network quality. Chen told ET’s Kalyan Parbat in Shenzhen that customers are no longer as price-sensitive as they were earlier, and are rapidly demanding an enhanced network experience with 4G services gaining mass traction and mobile video emerging as the new basic telecom service in India. Edited excerpts.

    Q: India’s older carriers have been averse to an early 5G spectrum sale and reluctant to spend big sums on 5G airwaves in the absence of a compatible ecosystem and relevant 5G use cases. Will such a strategy could prove counter-productive?

    A: Telecom operators must bravely invest in 5G airwaves (once available) as the 5G devices ecosystem will grow much faster than either 3G or 4G, coupled with the fact that spectrum utilisation efficiency levels will also be higher, which will make customer experience on 5G networks a superior one. These are important considerations, especially if they wish to enjoy sustainable leadership in terms of network quality and user experience in a competitive market.

    Q: But telcos say they are under immense financial stress in the sector…

    A: The Indian telecom industry is witnessing a gradual shift from affordability to quality. Customers are no longer as price-sensitive as they were before, and are increasingly demanding an enhanced network experience, especially with the mass popularity of mobile video and further development of 4G.

    Q: You mean the competition benchmark has shifted from low tariffs to one based on better network quality and user experience?

    A: Well, in metros and key cities, an operator’s core competitiveness will be defined by high quality networks offering a superior customer experience, and will no longer be determined by low tariffs. Operators having low quality networks will lose competitiveness and eventually their high-value users and markets.

    Q: Some operators blame the decline in overall quality of mobile services to heavy clogging in networks, amid explosive demand for data services. Your views.

    A: Operators have to a degree been compelled to compromise on network quality amid sustained financial stress caused by continuing price wars. But in an era where users are willing to pay for a superior mobile broadband network experience, any compromise on network quality and experience would automatically compromise the competitiveness of a telco.

    Q: From a global network vendor’s perspective, what ought to be the immediate priorities of telcos to survive and grow in a market where network capacity requirements are huge, spectrum cost is high and there is a paucity of last-mile fiber?

    A : Operators must resolutely invest in solutions that improve spectrum efficiency to address capacity requirements in any given spectrum band. Besides speeding up VoLTE rollouts across the country and refarming 2G/3G airwaves for 4G services, telcos must also invest in large-capacity transmission and backhaul solutions and simultaneously in customer experience management.

    Q: How is Huawei partnering with telcos to help them realise such objectives?

    A: Operators and network gear suppliers are natural allies in chasing the twin goals of superior network quality and experience. But operators must adopt positive vendor strategies to leverage OEM (original equipment manufacturer) interest and investment in network quality and experience improvement by working hand-in-hand. Huawei has customised a spate of solutions such as Massive MIMO, CloudAIR and SuperBAND that improve spectrum efficiency and quality. Indian operators have welcomed Huawei’s solutions in large-capacity 5G microwave along with 200G/400G WDM (wavelength division multiplexing) transmission technologies that can complement fiber and reduce fiber-related concerns to a minimum.

    (The journalist was in Shenzhen on the invitation of Huawei)

  5. Indian mobile carriers are apparently finding it hard to come out with relevant use cases for the fifth-generation or 5G technology making the government-backed commercial rollout gloomy as envisaged for 2020.

    “5G is not a mass technology, at least immediately. The next generation of technology is more inclined towards business customers which are shying away from it, making telco’s potential business opportunity in limbo,” a top executive of the country’s leading telco said.

    Since 2016, the Narendra Modi-led government has shown much enthusiasm and is not leaving any stone unturned with empowering the AJ Paulraj-headed 5G high-level forum and sub-committees for a healthy dialogue between the industry and government, as well as identifying the bottlenecks for a robust 5G roadmap.

  6. 5G spectrum sale may be deferred to early 2020

    Spectrum sale, including that of 5G airwaves, is likely to be pushed back to early 2020, given that the auctioneer will only be appointed by October 10, and major work on the draft auction documents is still pending, with the telecom department yet to take a call on airwave quantity and pricing, say officials and industry executives.

    “The timeline may be delayed by around a month, give or take,” said a Department of Telecommunications (DoT) official, who did not want to be named.

    The DoT had initially in June outlined plans to hold the next spectrum sale — first since 2016 — by December 2019.

    “It looks realistically difficult… extremely tight for auctions to begin by the year end,” said Rajan Mathews, director general at Cellular Operators Association of India (COAI), which represents all carriers in the country.

    DoT on Monday invited bids for selecting an auctioneer by September 25.

    The final selection will take place by October 10. The auctioneer’s appointment is typically followed by the government issuing the Notice Inviting Application (NIA) — the document formalising the terms and conditions of the auctions which includes the price and quantum of spectrum to be sold.

  7. Huawei says contiguous blocks of cheap 5G spectrum are needed in India

    Huawei believes India must focus on allocating contiguous blocks of cost-effective 5G spectrum for a successful rollout.

    Executives from Huawei made the comments during the company’s Connect event in Shanghai. Ken Hu, deputy chairman of Huawei, noted the allocation of spectrum as being among India’s current biggest challenges when it comes to 5G.

    “We hope that spectrum resources can be allocated more efficiently. It’s very important to have contiguous resources released to carriers in India,” Hu explained.

    Global 5G standards body the ITU states ‘true’ 5G requires 100MHz of 5G spectrum. Ideally, each operator needs at least this amount in a contiguous block.

    Speaking at the ET Telecom 5G Congress event in August, Bharti Airtel CEO Gopal Vittal said:

    “Indian operators need 1,000MHz of spectrum each in order to do 5G properly. There is a lot of work to be done freeing up mmWave spectrum in the high bands.

    Even when you talk about spectrum in the mid-band – the 3.5GHz spectrum – every operator is going to need 75-100MHz of spectrum. Otherwise, you will see a 5G icon displayed on your phone but, in reality, you will just be getting a 4G experience.”

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