18 Jun 2021
Indian telcos commence 5G trials, but mass adoption some way off, says GlobalData
Posted in Thematic Research
Following the news that India-based Reliance Jio and Bharti Airtel have commenced 5G trials;
Swati Verma, Associate Project Manager of Thematic Research at GlobalData, offers her view:
'India's telecom operators are wasting no time in kicking off 5G trials, but the road to widespread 5G adoption in India looks bumpy. 5G technology requires huge investments, and the country's telcos are already facing financial problems.
'5G trial authorization was delayed for two years, hence Indian telcos are making up for lost time. Leading operators Reliance Jio and Bharti Airtel have commenced trials in different cities. Reliance Jio is a clear leader in the 4G market and GlobalData expects it to lead the way in 5G as well. Jio is building a complete 5G ecosystem by developing a proprietary 5G network infrastructure. It is also expected to announce its own 5G phones, priced as low as US$35.
'Airtel will follow Reliance Jio in the 5G market. However, it will be difficult for Vodafone Idea to take the 5G leap. Vodafone Idea has suffered the most from the sector's aggressive competition. It lost customers to its rivals and owes considerable debts to the government.
'Cut-throat competition in 4G services has left all Indian telcos struggling for profitability with no cash in hand. The price of spectrum in India is several times higher than in other countries. In the spectrum auction held in March 2021, none of the three primary telecom operators bought 5G-suitable band. In addition, a major challenge for operators is highlighting the use cases for 5G. India is yet to develop relevant use cases that can be monetized. Operators will be testing 5G across applications such as telemedicine, online learning, and agricultural technology during the trials.
'The high cost of infrastructure and spectrum might mean users pay a premium for 5G services, and as a result price-sensitive Indian consumer may be reluctant to adopt the technology. GlobalData estimates 5G penetration globally will be 38% by 2025, but only 12% of the Indian population will be using 5G services.'
GlobalData plc published this content on 18 June 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 18 June 2021 09:28:04 UTC.