Rajan S Mathews, Director General, COAI
It was not long ago, when to speak to a relative abroad, one had to book an ISD call. This booking was preferably done for late hours when tariffs were relatively lower. And of course, the calls had to be kept short due to the exorbitant tariffs.
Enter the smartphone era: one can order your phone to make a call to someone, and better still, you can see the person on the other side via a video call. With some of the lowest tariffs in the world, the Indian telecom sector has made it possible for people to talk for hours at a go and stay connected round the clock. Data calls have made ISD calls as convenient and affordable as local calls and people are truly enjoying the benefits of a connected world.
Technology, especially communications technology has completely changed our lives and most of this change has taken place over the last two decades. Every 7–10 years, the technology gets significantly upgraded: the 90s were all about 2G – basic voice; this became 3G in the 2000s providing high speed data and introducing us to the world of mobile apps; now, 4G LTE, high speed data and high capacity voice is allowing us to stream cricket matches real-time on our phones and make long-distance international video calls with a number of people at once. In another couple of years, we will see the introduction of 5G, the next generation of mobile communication technology, built, in theory, as an overarching umbrella of networks rather than a replacement technology, enabling dizzying speeds, with astonishingly increased capacity. The potential of 5G is massive as it will be providing advanced solutions in the fields of telecom, energy, healthcare, agriculture, transportation, and logistics, among others. Experts are of the opinion that it is this technology that will turn the telecom service providers into multidimensional service providers.
The key drivers for 5G rollout and adoption are going to result in massive increase in data consumption, rapidly evolving digitalized services, growth of smart cities, and an all-encompassing network architecture that can utilize all available spectrum bands rather than replace the existing networks. This means more than just the ability to make video calls on your phone or download a high definition movie in a matter of a few seconds.
The biggest expectation of the next generation of communications is the enabling of IoT, connecting devices, and allowing users to control devices via the internet. Then there is data analytics, where sensors could give millions of data points and consequent insights enabling the management of risk and creating new business models. Sensors can be implanted in a person’s heart (or vascular aid) to monitor it and even correct any malfunctions.
One of the most benefitted sectors will be the automotive sector. We are on course to live in a time when your car will detect a malfunction in the gear-box. The on-board telematics-enabled predictive diagnostics system will be able to identify service-centers that have the parts and tools required to make the adjustment for your car’s make and model. You select the one you prefer, and instruct the car through voice command to pull over at the next exit. The service center dispatches a technician, and your car is repaired while you answer e-mails on your smartphone.
COAI has already put together a 5G forum, called 5G India Forum, that acts as a platform for the exchange of ideas and dialogue amongst the experts of the world. The Union Budget, toward harnessing the benefit of emerging new technologies like 5G and its adoption, proposes that government will support establishment of an indigenous 5G Test Bed at IIT, Chennai. The government has already created a high-level panel to ensure that there are no policy hurdles toward the roll-out of 5G technology based services and ensure that they start within the next 3 years. A government research team has already started the ground work and has reportedly filed 100 patents so far, giving India the leverage to generate indigenous intellectual property. Further, telecom equipment major, Ericsson, has partnered with IIT Delhi to jointly roll out 5G for India program. The company is setting up an incubation center and a test bed to work on the technology with the aim of tapping PM Modi’s Digital India, Smart Cities, and allied initiatives. Telecom majors like Airtel and BSNL have also partnered with Nokia to deploy 5G networks across the country.
Market reports suggest that 5G-enabled digitization revenues in India will be around USD 26 billion by 2026, less than a decade from now. The domestic operations can earn additional USD 13 billion revenue if they go beyond their traditional roles and serve as service enables, making the telecom service providers polygonal service providers. But for India, there are some fundamental challenges that need to be worked out or it will become a case of running before learning to walk.
The Indian telecom industry is currently facing its worst phase of hyper-competition and severely depleted margins that are making it very difficult for even the biggest service providers to invest in the new technology. The industry was already struggling with a cumulative debt of around `4.6 lakh crore with revenues falling to under `2.5 lakh crore. There is a considerable amount of uncertainty in the market and none of the service providers are likely to invest in the new services and would prefer a wait and watch strategy till business is better.
It is for this reason that the telcos have been pushing the government for some help, in terms of reduced taxes and levies, or even easier payment terms for the debts and spectrum bought. The telcos pay more than 32 percent of their revenues to the government in the form of taxes and levies, a situation made worse with the increased GST rate of 18 percent (from around 15% earlier). This is far too high for essential services providers like the telcos that have to continually invest in new technologies as well as service existing customers while operating in a country like India. In comparison, Pakistan’s telcos pay around 22 percent while Chinese telcos pay around 11 percent to their government.
Technology has enabled better collaboration across organizations and even cultures. It has the power to aid the quality of life. It has the potential to bridge various divides that separate us from each other – rich and poor, small and large enterprises, small islands and mega countries. Though it is not a magic potion that can solve all the problems, technology is definitely a great instrument for us to extract the most out of life, prolong it, and live the way life should be lived. The industry and the government are working together to ensure that India and Indians are the real winners and that can only be possible with timely intervention by the government to resolve the financial crisis affecting the telcos. It is only through private-public partnership and the active involvement of all stakeholders that India can get the best that technology has to offer and head into the future with self-assurance and belief.