Overview: The Announcement of 5G Services
Recently, the Government of India announced that the 5G services in India will be launched by October 12 and after that it will be further rolled out in other cities and towns. To meet the planned roll out, telecom operators are working hard in this regard and installations are being done in different parts of the country.
The government informed that it targets to make 5G services accessible in every part of the country in the coming two to three years and also to make them available to people at affordable rate. The telecom industry is focusing on both urban and rural areas.
Furthermore, the 5G services will be rolled out gradually and, in the first phase, the government has decided to make the services available in only 13 cities that would get the fast-speed 5G internet services. These cities are Ahmedabad, Bengaluru, Chandigarh, Chennai, Delhi, Gandhinagar, Gurugram, Hyderabad, Jamnagar, Kolkata, Lucknow, Mumbai and Pune.
In addition, the government mentioned that not all citizens in the aforementioned cities will get the 5G services and it is possible that telecommunication providers will offer these services in few parts of these cities. The government expects the 5G services to provide 10 times faster speed than 4G services.
Spectrum Auction: A Windfall to the Government
In the spectrum auction, the Department of Telecommunications received an up-front payment of around Rs 17,876 crore from Bharti Airtel, Reliance Jio, Adani Data Networks and Vodafone. In the auction, all telecom operators opted to make payments in 20 annual installments, but Bharti Airtel paid Rs 8,312.4 crore, which is equal to four annual installments.
And, in the auction, bids received for the telecom spectrum was worth a record Rs 1.5 lakh crore. Mukesh Ambani’s Jio got nearly half of all the airwaves with bids at Rs 87,946.93 crore. Gautam Adani’s group placed bids worth Rs 211.86 crore for 400 MHz, which is usually not used for offering public telephony services. Bharti Airtel made a successful bid of Rs 43,039.63 crore and Vodafone Idea bought spectrum for Rs 18,786.25 crore.
The Department of Telecomunications for the first time issued the spectrum assignment letters for 5G networks on the same day for the successful bidders of radio waves who made up-front payments.
Initiatives and Benefits to Service Providers
The government is encourging and facilitating Indian technology companies to develope 4G, 5G and E-Band spectrum products and solutions through various initiatives such as funding, hackathon and pilots. Indigenous technology companies are working on different system of 4G, 5G and E-Band network products with the support of government. Also, the government, under its Digital Communication Innovation Square (DCIS) scheme, has approved the funding for the 5G and E-Band technologies with definite milestones and deliverables.
The Department of Telecommunications hosted a 5G hackathon to develop solutions that enhance the technology adoption and create new use cases using 5G technology capabilities. Under the pilot scheme of Universal Service Obligation Funding (USOF), the government approved the funding to conduct pilots of the 4G and E-Band products in rural areas. These projects are envisaged to offer mobile coverage and provide high-speed connectivity in rural areas. Funds are also provided by the government for the development of an indigenous 5G testbed by research institutions that are working in the technology space and for enabling technology proliferation for Indian entities.
Under the Atmanirbhar initiative, the government has directed BSNL to deploy Indian Core for 4G network. The government has announced Production Linked Incentive (PLI) scheme with financial outlay of Rs. 12,195 crores to promote manufacturing of telecom and networking products in the country. The objective of the scheme is to promote domestic manufacturing of telecom and networking products, specifically 4G/5G products. It also provides a strong ecosystem facilitating design-led manufacturing of 5G products in the country.
The spectrum auction provides huge relief to the service providers by way of zero Spectrum Usage Charges (SUC) on the spectrum acquired and also in terms of the operating cost of telecom networks. The successful bidders are not expected to make any up-front payment. The bidders will be given an option to surrender the spectrum after 10 years with no future liabilities for balance instalments.
The government reiterates that connectivity will decide the pace of progress in 21st century India. Therefore, connectivity needs to be modernized at every level. 5G technology will bring positive changes in the governance of the country, particularly in ease of living and ease of doing business.