Communications Minister: India to be major telecom technology exporter in 3 years with its 4G/5G technology stack
Despite being very late to deploy 5G due to tardy licensed spectrum auctions, and with no known indigenous 5G network equipment vendors, India’s Communications Minister Ashwini Vaishnaw believes the country’s indigenous 4G/5G technology stack is “now ready” and the country is poised to emerge as a major telecom technology exporter to the world in the coming three years. Speaking at the Economic Times Global Business Summit 2023, Vaishnaw, who is also the Minister for Railways, categorically said there is no program for the privatization of the national transporter.
The 5G services were launched on October 1, 2022, and within a span of 100 days have been rolled out in 200-plus cities. The sheer speed of rollout has been appreciated by industry leaders globally and is being described in many international forums as the “fastest deployment happening anywhere in the world,” he said. Vaishnaw highlighted the population-scale solutions being tested on India stack, across platforms such as payments, healthcare and identity. Each of these platforms is powerful in itself, but together become a dynamic force that can solve “any major problem in the world.”
The minister said India is set to emerge as a telecom technology exporter to the world in the next three years. “Today there are two Indian companies that are exporting to the world…telecom gear. In the coming three years, we will see India as a major telecom technology exporter in the world,” Vaishnaw said.
The minister talked of the rapid strides taken by India in developing its own 4G and 5G technology stack, a feat that caught the attention of the world. “The stack is now ready. It was initially tested for 1 million simultaneous calls, then for 5 million, and now it has been tested for 10 million simultaneous calls,” he said terming it a “phenomenal success.” At least 9-10 countries want to try it out, he added.
The minister gave a presentation outlining key initiatives under his three ministries of telecom, IT and Railways. For Railways, the focus is on transforming passenger experience, he said as he presented slides on how railways is redeveloping stations and terminals (New Delhi, Ahmedabad, Kanpur, Jaipur among others) with modern and futuristic design blueprint, and in the process creating new urban spaces while also preserving rich heritage.
The minister also gave an overview on the Vande Bharat train, the indigenous train protection system Kavach and progress on the bullet train project. To a question on the past talks around private freight rail corridors to boost logistics, the minister said “there is no program for Railway privatization.” “In a country where we have 1.35 billion people, 8 billion people moving every year on Railways, we thought that it is prudent to learn from the experience of others, and keep it within the Government set-up,” Vaishnaw said.
India’s Communications Minister Ashwini Vaishnaw (Photo Credit: PT)
To another query on dedicated freight corridor for food grains, the minister explained that when it comes to transport economics it is important not to divide assets between different applications.
“Today, the thought process has got very refined, and we are adding close to 4500 km of network every year, which amounts to 12 km of new tracks per day. So we have to increase the capacity to such a large extent that there is enough capacity for food grains, enough for coal, small parcels, and every kind of cargo,” he said. While Railways had been consistently losing market share over the last 50-60 years, it has started clawing it back.
“The lowest point was 27 per cent. I am happy to share that from the 27 per cent level, last year Railways increased to 28 per cent, this year we are doing close to 29-29.5 per cent, and in the coming 2-3 years Railways will go towards 35 per cent market share,” he added.
People will choose between transport via road, railways or air based on the distance to be travelled, and “there will be enough for everybody”. “The country will have enough for everybody, is my point. Up to 250 kilometres road is very good, 250 to 1000 kilometres railway is the ideal mode. Beyond 1000 kilometres air will be the ideal mode. So there will be enough for everybody,” the minister said.
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Light Reading: 5G war heats up between Airtel and Jio in India
The 5G war between India’s top two telcos, Reliance Jio and Bharti Airtel, formally started this month, with both service providers launching their 5G plans.
While both Jio and Airtel launched 5G services in October last year, they have been offering free services to users with 5G-enabled devices. Jio launched the first 5G recharge plan in January this year. This was available to all 4G users with a base tariff plan of 239 Indian rupees (US$2.89) or more. As per this plan, Jio subscribers would need to pay an additional INR61 ($0.7) to upgrade to the 5G upgrade tariff plan, which also includes 6GB of data.
Jio followed this up by introducing the JioPlus postpaid plan for a family of four. It is available in two versions, one priced at INR399 ($4.82) for 75GB data and the other at INR699 ($8.45) for 100GB data. This plan may help Jio attract postpaid customers from Bharti Airtel and, especially, Vodafone Idea, which has yet to launch 5G services. Jio now offers 5G coverage in around 406 cities across the country and is aiming to cover the entire country by December 2023. Jio is the only Indian telco to have launched 5G standalone.
Jio and Airtel seem to be fighting for postpaid users. Around 95% of Jio’s 430 million subscriber base is using its prepaid packages and the company hopes to change this with the launch of 5G services. However, this is possible only if it can attract postpaid users of other telcos or move its prepaid users to postpaid. It is tougher for Jio to attract postpaid subscribers of other telcos because they are typically not as price-sensitive as prepaid users.
Airtel reacted to Jio’s offers by launching an unlimited 5G data plan with the aim to “inspire customers to explore the potential of the Airtel 5G Plus network.” However, Airtel’s 5G network is available in only 270 cities in India, while Jio offers 5G in 400+ cities.
Competition will intensify
Airtel has granted its postpaid subscribers and prepaid users who pay INR239 ($2.89) or more unlimited access to 5G data. It further lowered the entry-level tariff for postpaid family plans by launching a INR599 ($7.24) tariff and two other plans costing INR799 ($9.66) and INR998 ($12.07) as part of its all-in-one Airtel Black offering. While Jio’s family plan is cheaper than Airtel’s, it doesn’t include any OTT offering.
Airtel’s focus on postpaid customers is clear, given it recently increased base tariffs from INR99 ($1.19) to INR155 ($1.87) for prepaid customers.
While Airtel and Reliance Jio slug it out in the 5G market, India’s third-largest service provider, Vodafone Idea, is yet to launch 5G services in the country. The competition will possibly heat up further once Vodafone Idea joins the fray.
The coming few months will see the competition between Jio and Airtel for greater market share intensify, especially in the more lucrative enterprise segment.