UBS: 5G capex at $30 billion for India telcos; 5G spectrum auction by January 2020?
UBS analysts say that India’s top three telecom operators will have to spend a little over $30 billion on 5G base stations and fiber infrastructure. According to UBS, the need for a dense site footprint and fiber backhaul for 5G access networks will likely shift the balance of power towards larger and integrated operators with strong balance sheets.
Bharti Airtel and Vodafone Idea would need $10 billion capex each over the next five years.
“Bharti has solidly defended its market share and has narrowed the gap with Jio on 4G network reach, with improving 4G net adds. The company recently revamped its digital offering and launched converged digital proposition ‘Airtel Xstream’ offering digital content across TV, PC and mobile devices along with IoT solutions for connected homes. Further, Jio’s recently announced fixed broadband plans starting at Rs 699 are not as aggressive as we (and the market) feared and, therefore, do not pose significant pricing pressure on Bharti’s broadband average revenue per user,” UBS said in a research note to clients.
Reliance Jio’s incremental 5G capex is estimated somewhat lower at around $8 billion. That’s because Jio already has more 5G-ready fiberised towers than the incumbents, having already spent around $2 billion on tower fiberization.
Analysts were skeptical about Vodafone Idea’s ability to sustain such big-ticket capex spends given its continuing market share losses and weak financials, which they said could limit its 5G deployment ambitions.
They also said the need for a dense site footprint and fibre backhaul in 5G would shift the balance of power towards larger and integrated operators with strong balance sheets like Jio and Airtel, while those with high gearing levels are at risk given the sustained high capex needs.
“Airtel and Vodafone Idea will each need to spend $2 billion annually on 5G radio and fiber capex spread across 5 years,” UBS said in a report, implying 65% and 85% of Airtel’s and Vodafone Idea’s current annual India capex run rates respectively.
By contrast, Jio’s 5G capex, “would be lower due to its larger tower footprint and higher proportion of towers on fibre backhaul compared with Airtel and Vodafone Idea.” The brokerage firm also expects Jio to transition to 5G in a “time-efficient manner,” given its in-house data centres and investments in a content distribution network (CDN).
“Vodafone Idea’s stretched balance sheet will limit its participation in the 5G opportunity, and the company will require a significant improvement in network quality to arrest market share loss and revert to revenue growth,” UBS said.
Credit Suisse backed the view, saying, “Vodafone Idea will lose the most market share, and will need additional equity capital by FY2021, given our expectation of no price increase”.
UBS estimates that Airtel’s India mobile revenue will grow 5-6% in this financial year and the next even if interconnect usage charges – a source of revenue for incumbents – get scrapped from January 2020.
According to analysts, the India telecom sector can reduce overall estimated $30.5 billion 5G capex spends by 15-20% if Airtel, Vodafone Idea and Jio share towers and fiber resources. However, there is currently no progress on that front.
“We estimate the sector can reduce overall capex by 15-20 per cent if the three Indian telcos share towers and fiber (either commercially or driven by the regulator) – third-party tenancy poses upside risks to our estimates,” UBS said in its report.
……………………………………………………………………………………………………………
India’s Department of Telecommunications wants to hold a 5G spectrum sale by January 2020 at the latest, according to referenced sources.
Credit Suisse doesn’t expect that 5G spectrum sale to attract much interest. That’s due to a mix of “high reserve prices, telcos’ focus on monetising 4G investments, stretched balance sheets, a nascent 5G ecosystem and lack of significant 5G use cases for mass consumption.”
Rajiv Sharma, co-head of research at SBICap Securities, said that Vodafone Idea is unlikely to bid for 5G spectrum at current base prices “as the telco doesn’t have an existing pan-India 4G network that is essential for any telco planning to spend top dollars on 5G,” according to the report.
Analysts believe that Reliance Jio will probably take part in the process, as it is the only profit-making telco in the Indian market.
The Department of Telecommunications (DoT) had recently asked the Trai to lower the starting prices, which the regulator refused. “There was a chance for the Trai to reduce 5G prices. Let’s see what the DoT does now. But at current rates, Airtel won’t buy,” Airtel’s executive reportedly said.
Vodafone Idea CEO Balesh Sharma has previously said that the prices recommended by the regulator were ‘exorbitant.’ The telco said it will participate in the next auction but did not confirm if it would buy 5G spectrum.
Hemant Joshi, partner at Deloitte India, said it would be “prudent to defer the 5G auction till 2020 at least since at Trai’s recommended base prices, the industry response may be very lukewarm.” He also said that the reserve prices need to be lowered, taking into account the experiences in countries where 5G spectrum was recently auctioned.
……………………………………………………………………………………………
Analysts said there are three things that India’s Centre for Telecom Excellence (within the DoT) must do immediately to hasten the adoption of 5G:
First, lay down a clear roadmap of spectrum availability and specify frequency bands aligned with global standards (IMT 2020 from ITU-R). Given that 5G services will be supporting massive data applications, operators will need adequate spectrum.
Editor’s Note: India’s TSDSI has proposed a candidate IMT 2020 RIT based on Low Mobility Large Cell (LMLC), but it hasn’t yet been accepted by ITU-R WP 5D. TSDSI posted a revised and more comprehensive proposal on 10 September 2019, which will be evaluated at the next ITU-R WP 5D meeting in December.
………………………………………………………………………………………………….
Second, there is a need to move away from the existing mechanism of pricing spectrum on a per MHz basis. 5G services require at least 80-100 Mhz of contiguous spectrum per operator. If the Centre were to fix the floor price based on the per Mhz price realised in the last auction then no operator would be able to afford buying 5G spectrum. The pricing, therefore, will have to be worked out anew, keeping in mind the financial stress in the telecom sector and affordability of services.
Finally, the Centre must rapidly complete the national fiber optic network rollout as 5G high speed services will require huge back-haul support for which existing microwave platforms will not be sufficient.
11 thoughts on “UBS: 5G capex at $30 billion for India telcos; 5G spectrum auction by January 2020?”
Comments are closed.
From https://www.ubs.com/global/en/wealth-management/marketnews/home/article.1453135.html
5G faces some very real economic issues. Carriers will have to fund additional spectrum purchases at the same time they are building 5G networks, and continuing to upgrade 4G networks. Small cell densification requires a very high investment into additional fiber optic cable.
We also believe carriers will have to creatively and compellingly market and position 5G beyond a simple speed upgrade to drive consumer adoption, and enterprise adoption will likely require much trial and error.
While the infrastructure and technology investment will be significant, there are numerous monetization opportunities for carriers, equipment vendors, fiber optic owners, and handset manufacturers.
However, we do caution that the 5G ramp will be lengthy, with some industry players pointing towards 2035 as the year the full economic benefit will be realized. We also expect that progress will be uneven and that experimentation of new business models will be accompanied by some failures.
Looking at the major industries the transition to 5G will affect, telecom equipment is one of the earliest beneficiaries. Industry analyst IHS forecasts the global 5G equipment market revenue will grow at more than a 70% compound annual growth rate from 2019-2022 to approximately USD 20 billion and continue to rise until 2025.
The current small cell rollout only represents the last-mile of 5G wireless connections. Carriers are pushing wireline networks as close to the customer as possible prior to the small cell utilization, which requires connection to new and existing fiber optic cables.
Fiber-leasing is a common tactic carriers are using, which is giving tower companies a boost in revenues. To put the demand in perspective, Verizon acquired XO Communications in 2016 for USD 1.8 billon. In doing so, Verizon received 2.3 million route miles of fiber. Verizon has also signed a supply agreement with Corning, a leading global provider, to buy up to 20 million kilometers of optical fiber annually from 2018-2020.
From UBS 11 Sept 2019 report (free download): 5G refresh – a lot has happened in two years
Industry analyst Ovum forecasts as many as 1.3 billion 5G users globally by 2023 compared to approximately 720,000 by the end of this year. Given that 5G is useful for industrial and enterprise customers, we would expect a larger portion of the initial subscribers to be those focused on IoT and autonomous compared to 4G and 3G rollouts.
Although 5G smartphones are already available, 2019 will likely not be a ground-breaking year. We would expect adoption to ramp up in later 2020 and 2021 in the US as the carriers continue to roll out coverage and develop the small cell network needed for the advertised performance.
The 5G investment cycle is also predicted to last longer than 4G, which only took six years to reach its peak. Nokia expects 5G to reach its zenith in seven to 10 years due to a number of factors, the largest one again being the end customer. The innovation enabled by 5G such as autonomous driving and smart cities will require more
time to deploy the necessary infrastructure and frequencies. North America and China are expected to lead the charge, with Ovum predicting North America consisting of 14% of the 1.3B subscribers mentioned previously.
……………………………………………………………………………………………………………………………….
The RAN in 5G will be increasingly virtualized, meaning that instead of dedicated, purpose-built hardware will be replaced by general purpose servers (most likely x86) that will run the network as a series of functions in software. This network functions virtualization (NFV) enables key features of 5G adoption and economics. A virtualized RAN will enable network slicing, which allows a single physical network to be separated into multiple virtual networks that provide distinct service quality and offerings.
Network slicing: Multiple applications such as voice, video, and are all currently supported on the same 4G network infrastructure, leading to inefficiency and low utilization. Network slicing is a new feature within 5G that aims to provide a dedicated virtual “slice” of the network to support a specific application. For example, two businesses may be on the same mobile network, but have very different mobile bandwidth requirements. One business may need ultra-high bandwidth, while the other requires extremely high reliability. Complicating the matter is that both customers have irregular usage patterns and therefore cannot justify a dedicated service. Satisfying both customers’ needs in a 4G environment is possible, but not particularly practical as significant network engineering is required each time the services are turned up.
However, the software enabled 5G network is able to provide multiple dedicated network services when needed and where needed on the same physical infrastructure. A software layer on top of the physical infrastructure allocates horizontal “slices” of the network from end-to-end, i.e. from the application in the network core out through the radio network and into the end device. Importantly, this can be on-demand and can be applied as a vertical solution for individual markets.
…………………………………………………………………………………………………..
5G will likely have carriers looking beyond wireless:
We believe carriers will have to creatively and compellingly market and position 5G beyond a simple speed upgrade to drive consumer adoption. We expect to see significant bundling of media over time. Furthermore, fixed wireless access may be a necessary ingredient to drive adoption. Although FWA (Fixed Wireless Access) has ramped slower than originally expected, we believe solid progress is being made by carriers in the United States. Importantly, we believe US carriers will focus on FWA combined with over the top video offerings (whether proprietary or US equities 11 third party) to support their nascent efforts in digital advertising. The combination of authentication and the rich user history available to carriers makes the USD 50bn US television advertising market an attractive adjacency
India telecom minister Ravi Shankar Prasad on Friday said the 5G spectrum auction will be conducted this year-end or early next year.
“The communications policy is already in place, and by the end of the year or the beginning of the next year, we propose to go for auction of spectrum. We are very sure that India’s auction of spectrum will be done in fair and transparent manner,” he said at an event in Mumbai.
Under the scheme, the government plans to auction around 8,293.95 MHz of airwaves at an estimated total base price of Rs 5.86 lakh crore.
The DoT has suggested a base price for 5G airwaves at Rs 492 crore per MHz and proposed a sale of a minimum 20 MHz blocks, which would mean a telco spending close to Rs 10,000 crore for 20 MHz, and Rs 50,000 crore for 100 MHz.
“My department will surely look into all the issues of the telecom sector. Many of them we have already taken up with ..
https://economictimes.indiatimes.com/industry/telecom/telecom-news/5g-spectrum-auction-by-year-end-or-early-2020-ravi-shankar-prasad/articleshow/71117477.cms
Yet another informative article by the author!
As to the capital investment requirements quoted by UBS and others, one has to be very skeptical regarding the capacity of major Indian carriers. They do not have the internal cash flow to make such expansion. That would leave the big three Indian carriers no option other than taking on new debt obligations on top of already disproportionately heavy debt and a questionable ROI/business model.
Moreover, in spite of the hype, clear 5G use cases in most markets remain elusive.
5G use cases based on ultra low latency can not be implemented till 3GPP Release 16 is complete (sometime in 2020) and forwarded to ITU-R WP 5D for inclusion in IMT 2020 specs (to be finalized in early 2021).
Enhanced Mobile Broadband use case would require ubiquitous 5G, standardized 5G spectrum, roaming and many more 5G smart phones. Not here yet and won’t be until atleast 2021.
5G telecommunication, the widely-awaited next-generation technology, is just around the corner, but may not come into India with a dance, and may rather need government crutches to walk in. India is staring at the onset of 5G technology at a time when the telecom companies in the country are struggling with weak finances, low profitability, intense competitive pressures and existing infrastructure costs. Catering to a huge customer base in a country with a population of over 130 crore people would require a lot of funds to cover the costs of equipment, fibre, and tower installation. This may be difficult for Indian telecom firms.
Adding more burden of new infrastructure costs looks like a far-fetched move for Indian telecom companies at this time when the industry is reeling under intense competition and struggling to keep up margins. “Implementing 5G technology in India will need a tower at every 500 metres, which would generate substantially higher radiation. The license fee can itself cost around Rs 25,000 crore for an operator, which can only be borne by a few companies such as Jio, which can take international loans,” Shrawan Dubey, Circle Secretary, Telecom Officers Association, BSNL, told Financial Express Online.
He added that it is difficult to get such huge loans from banks and therefore the government’s help will be the only way other operators can afford it. A discussion at the World Economic Forum’s India Economic Summit this week may have a solution to 5G funding woes — government support in laying down the infrastructure. Governments and regulators across markets, including in India, must look at 5G as national infrastructure, Magnus Ewerbring CTO, APAC, Ericsson South-East Asia, Oceania, and India said at a discussion at the India Economic Summit in Delhi.
A 5G national infrastructure could help telecom companies with a lesser burden of costs such as infrastructure, licenses, etc. “5G will bring socio-economic growth to nations in every corner of the globe. It will enable a connected, digital society and act as a core foundation for the Fourth Industrial Revolution, building on the scale of billions of connected devices and a global system of vendors,” Magnus Ewerbring of Ericsson said.
Indian telecom companies with legacy infrastructure will have to consider replacement costs before taking the 5G road. “While Reliance Jio focuses on prioritising 5G investments in anticipation of accelerating commercial prospects, other telecom companies seem to be having a more conservative outlook,” said a recent Deloitte report.
New telecom technologies can provide much-needed gains in efficiency and profitability as 5G is a system developed not only to support massive growth in mobile broadband use but also to support broader uses that require secure and reliable connectivity. These include massive machine-type communications such as smart buildings, logistics, fleet management, smart agriculture, and smart meters. 5G also addresses critical machine-type communications such as traffic safety and control, remote manufacturing and industrial applications.
https://in.finance.yahoo.com/news/excited-5g-cash-crunch-may-124646272.html
India is emerging as the testing and acquisition playground for global consumer technology companies, especially the so-called FAANGs, according to a veteran Internet analyst.
RBC Capital Markets’ Mark Mahaney, who calls himself Wall Street’s “oldest Internet analyst” after covering the sector for more than two decades, said India is now more popular than markets like China because it has the same growth dynamics but with fewer regulations.
As one of the largest economies and most populous countries in the world, India has turned into a testing ground for companies such as Facebook, which has used it to beta-test a payments feature for WhatsApp. Netflix rolled out a mobile plan in India at Rs 199 ($2.80), much cheaper than what it charges for a basic plan elsewhere, and has created original content to capture more market share.
“India does have regulations but it doesn’t seem to be as protectionist as China,” said Mahaney. India has been considering a new law that would require personal data to be stored locally, which could impair the operations of the Internet giants but Mahaney remains confident they can still penetrate the market.
Besides organic growth, acquisitions are another strategy for these companies in India, especially since they are facing more scrutiny back home and in western Europe. “There’s an opportunity to build growth” in Asia, particularly in India, Mahaney said.
Amazon has already tried its hand at deals in the South Asian nation by attempting to acquire Indian ecommerce pioneer Flipkart, before it was snapped up by Walmart last year.
Facebook, Netflix, Amazon and Alphabet can all win big in India, said Mahaney, who has a buy rating on the stocks. “India is less than 5% of Amazon’s total revenues but it has the potential” to get to that level within five years, Mahaney said.
https://telecom.economictimes.indiatimes.com/news/us-tech-giants-turn-to-india-for-new-apps-before-world-release/71450318
5G spectrum needs to be affordable: Nunzio Mirtillo, Ericsson
“If I should be in the shoes of the customer, obviously spectrum needs to be affordable, otherwise it does not make sense. I can’t say if they will go muted or not, but there is a limit to investment capabilities of the operators, which is obvious.”
https://economictimes.indiatimes.com/industry/telecom/telecom-news/5g-spectrum-needs-to-be-affordable-nunzio-mirtillo-ericsson/articleshow/71797226.cms
5G WEAK SIGNAL, by Suman Layak
1 December 2019 The Economic Times – Delhi Edition
Copyright © 2019. Bennett, Coleman & Co., Ltd.
The plan to conduct 5G spectrum auction early next year seems unrealistic, given the battering in the telecom space and the paucity of viable use cases for the next-gen network
The National Company Law Tribunal courtroom of MK Shrawat and CB Singh in Mumbai was empty on the afternoon of November 27, though a vital order for the beleaguered telecom sector was due that day. The court was to decide whether Aircel, the insolvent telecom operator, could retain the right to use its allotted portion of airwaves, and make it count as an asset in the ongoing debt-resolution process.
The order was finally available on the website past midnight, around 12.30 am on Thursday. It said, much to the relief of Aircel’s creditors, the Department of Telecommunication (DoT) could not take away the telecom spectrum from the bankrupt company.
The implications of the order went beyond Aircel: the Anil Ambani-promoted Reliance Communications had filed for bankruptcy in February. The DoT had wanted to take back spectrum from mobile telephone service operators who have not paid their dues so that it can reauction them. For telecom players, the right to use spectrum for the licence period is an asset that they can transfer to other bidders.
Like the court of Shrawat and Singh, multiplied to ?7.64 lakh crore from ?2.8 lakh crore in the same period. At the same time, there is consumer dissatisfaction over low-quality network. While some companies are in the bankruptcy courts, Airtel and Vodafone are trying to deal with a ?92,000 crore blow from the Supreme Court in a 16-year-old case related to revenue calculation.
It does not bode well for the sector that it has to deal with these issue at a time when the world is talking about adopting much of Indian telecom sector is today burning the midnight oil to figure a way out of the mess it finds itself in. From 10 private sector telecom operators not so long ago, India now has only three major mobile telecom players – the Sunil Mittal-led Bharti Airtel, the Aditya Birla Group and Vodafone Group venture Vodafone Idea and Mukesh Ambani’s Reliance Jio. A battle of attrition over tariff between the three, after Reliance Jio entered the market and grabbed almost a third of the market share, has seen the operators’ cash flows shrink rapidly over the past three years. The industry’s annual revenues have largely been stagnant since FY2015, while cumulative debt has 5G technology – the next generation of super-fast wireless communication technology. South Korea has already rolled it out in Seoul and Indian companies were about to start their own pilot projects. Union Telecommunication Minister Ravi Shankar Prasad had said the government plans to auction extra spectrum for 5G services by early next year. However, this seems to be the worst of times for 5G rollout.
Talking of 5G now when every company is haemorrhaging cash, says a former CEO of an Indian telecom company who didn’t want to be named, is akinto Nero playing the fiddle while Rome was burning.
Sanjay Kapoor, former CEO of Bharti Airtel, says the enthusiasm for 5G across the world is being driven by equipment makers, like Huawei, Nokia and Ericsson, and the governments, but the device ecosystem is still lagging. “Use cases for 5G have to be fully developed for every market and then monetisation plans have to be worked out. There is much work left to do,” he says.
Despite the challenges facing the sector, the government’s plan to auction airwaves would open the supply taps. A total of 8,644 MHz of airwaves might be put up on offer, though the previous spectrum auction saw poor response. In 2016-17, the government could sell only 41% (965 MHz) of the spectrum on offer. It raised about ?65,000 crore though the base price of the entire spectrum value on the block was pegged at ?5.6 lakh crore. A mega-auction has been in the works for some time now, along with spectrum for 5G technology, in the 3,300-3,600 MHz band.
For the upcoming auction, the Telecom Regulatory Authority of India has suggested a base price of ?492 crore per MHz for 5G spectrum. Operators are almost unanimous that they would need 100 MHz each to roll out 5G, which means they would have to pay nearly ?50,000 crore each for the spectrum fee alone. This would make it the highest priced 5G spectrum in the world.
Despite the abundance of supply, demand during auction might be low due to other problems. Aircel and Reliance Communications will not participate as they are in insolvency courts. Airtel, Vodafone Idea and others are dealing with the massive financial blow after the Supreme Court in October ruled that licence fees of operators need to be calculated on the basis of their adjusted gross revenues, and not their telecom revenues alone. In an attempt to give some relief to the companies struggling with high debt and huge losses, the government then announced a two-year moratorium on payments of spectrum dues.
For Bharti Airtel, the ruling means an additional burden of ?35,000 crore on pending dues. Vodafone Idea has dues of around ?53,000 crore. Vodafone Global CEO Nick Read had in November reportedly hinted at virtually writing off the India investments, although he retracted and apologised a day later.
Bharti Airtel has moved a petition in the Supreme Court seeking permission to negotiate with the government to find a way to reduce the burden. Vodafone has also moved the court for relief.
The third operator, Mukesh Ambani-promoted Reliance Jio, has much lower dues at ?60 crore, mostly because it is a recent player and has already paid a part of the dues. However, sources say, Reliance Jio might also go slow on 5G.
For the quarter ended September 30, Bharti Airtel posted a loss of ?23,044 crore and Vodafone Idea reported a loss of ?50,921 crore. Jio posted a 45% rise in profit at ?990 crore.
Reliance Jio, Vodafone Idea and Bharti Airtel did not respond to queries.
Chairman of Inditrade Capital and market analyst Sudip Bandyopadhyay points out that while the government has announced a moratorium for spectrum payments to help the industry, it cannot expect a good spectrum auction at the same time. “It is best for the government to not do 5G auctions now, because if it does, who is going to buy? And how will it get a good price in this kind of a market? Even if Reliance Jio participates, it will get the auction at a low price and will be able to hoard it.”Much of the woes of the telecom sector, including the bankruptcy of some of the operators, can be traced back to the entry of Reliance Jio and the tariff battle that followed. However, Reliance Jio, after gaining about one-third of the market, has now raised tariff, signalling an end to the battle.
Director General of the Cellular Operators Association of India (COAI) Rajan Matthews says the sector needs time to settle down. “We do not believe that the time is ripe for 5G auctions. The concerns around financial health of the sector must be resolved immediately. Hence, we are of the view that the government should not rush to spectrum auctions and should wait for the market to settle down.”A Tech PuzzleBeyond the financial issues, the sector is also facing technical problems.
Kapoor, who sits on the board of Saudi Telecom, which launched 5G services in Saudi Arabia in June, says the road to 5G is complex in India. He lists out a few necessary changes that Indian operators must implement first before looking at the next-gen technology. Much of the margins in 4G were taken away by the content players who rode on the bandwidth, he says. For 5G, the telecom operators need to get this margin balance right. Also, he says, a big difference will be that 5G is likely to have more focus on B2B operation, and the operators will need to set up a fresh marketing machinery to sell the same. There would be manufacturing and service sector applications, like robotics or tracking and even financial sector applications, in 5G.
On the technical front, Kapoor points out that 5G is a higher speed network with low latency (the time it takes for a request for data to reach the server and for the data to reach the user). This allows it to be used for critical applications, such as driverless cars, which need a strong fibre network connection. There cannot be any dark spots in the network for such applications. “Complete coverage across India may be uneconomical,” Kapoor says, adding that while inter-city fibre may be available, India lacks enough intra-city fibre.
High InvestmentPrashant Singhal, technology, media and telecommunication leader for emerging markets at EY, says the investments that need to go in for 5G in India are likely to be much higher than those for 3G or 4G networks and there is no need to rush into it. “The 4G auctions had happened in 2010 and the rollout happened only by 2015-16. We do not want such a situation in 5G also,” Singhal cautions.
E&Y has estimated that it would cost $100 billion or so to launch 5G in India. The government has announced a moratorium on spectrum fees payments and has asked the GST Council to help lower the tax burden. Given this situation, Singhal says, where is the question of doing a successful spectrum auction, leave alone a 5G launch.
To be sure, work has already started on trials and development of 5G use cases. Ericsson has set up Centre of Excellence and Innovation Lab for 5G at the Indian Institute of Technology-Delhi. Intel has inaugurated the Intel Design Center, its new R&D facility for 5G and artificial intelligence, in Bengaluru. The DoT in June flagged off 5G trials, stating the trials would go on for a year. But the early-2020 target for 5G spectrum auctions looks impossible to achieve. “India can and will adopt 5G in good time,” adds Matthews of COAI.
Bennett, Coleman & Co., Ltd.
5G financing: Unbundle services, say Trai chairman
The industry needs to come up with innovative investment solutions like unbundling of infrastructure and investments for different services in the telecom sector in order to finance the adoption of the 5G technology, the Telecom Regulatory Authority of India (Trai) Chairman Ram Sewak Sharma said.
“This could be one way of distributing investments needed for 5G technology, Sharma said at the ‘Telecom Summit 2020 5G Technology: Forging Ahead Into a Smarter India, ‘ organised by the PHD Chamber of Commerce & Industry (PHDCCI) and the Telecom Equipment Manufacturers Association (TEMA).
The top official also said that it had favoured local manufacturing of telecom gear, and already sent out its recommendations to the government.
Sharma added that it must be kept in mind that telecom players could not be investing alone in the country’s quest for 5G technology that will have multiple applications and that adopting unbundling of services could help the private telecom sector cope with the investment needs that are going to be huge.
“The key issue is to explore the possibilities of common infrastructure and sharing the same and how to frame policies for this so that no one is hurt, said Ajit Pai, Advisor, NITI Ayog, and added that asset monetisation could be one aspect that the telecom players could consider.
Sandeep Agarwal, Chairman, Telecom Committee of the PHDCCI said that 5G was needed and while discouraging products, technology should be imported by India.
“ITI and C-DOT can be used to invest in higher technology, optical fibre preforms and chip manufacturing. The foreign companies must be allowed access to Indian market only on the condition they sell technology and allow manufacture of licensed telecom equipment in India, ” Agarwal said.
Expressing his apprehensions over bringing 5G too soon, he said that the government could consider whether this was the best time to embrace 5G.
https://telecom.economictimes.indiatimes.com/news/unbundling-of-infratructure-to-help-telecom-sector-trai/73517888
Thanks for the great information on 5G. However, India’s 5G auction continues to be delayed with no set date yet.