Why Indian telcos are building 5G at breakneck speed
India's 5G rollout is generating headlines, with equipment suppliers and government figures touting it as one of the fastest ever.
Since the launch of 5G last October, Reliance Jio's services have become available in more than 400 cities and towns, while Airtel's services can be accessed in more than 500. Jio plans to provide all-India 5G coverage by December, with Airtel aiming for blanket availability by March next year.
Telecom minister Ashwini Vaishnaw previously asked telcos to deploy at least 10,000 5G basestations per week, up from the 2,500 they had been installing. Just 22,000 basestations had been deployed by December last year, but the pace of rollout has quickened. By April 23, the operators had installed as many as 163,878 basestations, according to the data shared by the Department of Telecommunications (DoT).
Predictably, the focus is on Category-A circles (service areas) and metro cities, since these generate more revenues for the telcos. Tamil Nadu, Maharashtra, Uttar Pradesh, Gujarat, Karnataka and Delhi currently have the highest concentration of 5G basestations. Because they are economic hubs, the concentration of 5G-enabled devices is also likely to be higher in these circles.
Fight for Vodafone Idea's customers
Some have questioned the urgency surrounding 5G rollout, especially as telcos have been crying hoarse about the lack of a killer use case for the retail segment. The answer lies in the debt-ridden situation of Vodafone Idea – the only private telco yet to launch 5G services.
Recently, Vodafone Idea complained to the Telecom Regulatory Authority of India (TRAI), accusing its rivals of predatory 5G pricing. Although it has been shedding customers for years, there can be little doubt that losses have accelerated since the launch of 5G. Vodafone Idea had lost about 7 million in the four months leading up to 5G's launch in October last year. In the four months following the introduction of 5G services by Airtel and Jio, its losses soared to about 10 million.
Vodafone Idea is known to have a significant percentage of high-spending customers who have remained loyal to it. These customers typically show limited interest in lower tariffs, but many will have been drawn to 5G services available only from other telcos, with Vodafone Idea's 5G plan nowhere close to fruition. Airtel and Jio, accordingly, are racing to build 5G networks and attract as many Vodafone Idea subscribers as possible.
Airtel recently announced it had reached the milestone of capturing 10 million 5G customers, and the growing number is encouraging telcos to accelerate 5G network deployment.
But there are some key technical differences. Airtel is deploying 5G in non-standalone (NSA) mode, which uses 4G core, making it easier to expand quickly. Jio, which owns 700MHz spectrum across the country, is deploying the standalone (SA) variant, which introduces a new 5G core that promises additional features.
The other reason for this breakneck speed might have something to do with the politics. If Airtel and Jio meet their targets, they will have provided pan-India 5G coverage before the next general election in May 2024.
While there is no direct link between 5G deployment and general elections, widespread availability of a new technology will add to the feel-good factor for the ruling party, which would tout this as one of its achievements. The 5G rollout could also help the government to portray itself as a technology-friendly administration that is helping India keep pace with global developments. All this likely explains government pressure on telcos to accelerate 5G deployment. Government intervention may also be why Airtel and Jio continue to offer 5G services at 4G rates. According to media reports, they have postponed tariff hikes until after the general election.
Authorities have also come up with initiatives that are making it easier for the telcos to expand 5G networks quickly. The PM Gati Shakti National Master Plan was introduced last year, uniting 16 ministries, including railways and power, to improve coordination for implementing infrastructure connectivity projects. This plan is also helping with the identification of street furniture that can be used to deploy 5G small cells. The government has also allocated funds to set up 100 labs for the development of 5G use cases.
- 5G war heats up between Airtel and Jio in India
- Jio, Airtel launch 5G services in India
- Why 5G services are crucial for India's Jio
— Gagandeep Kaur, contributing editor, special to Light Reading
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