Indian Telcos’ search for buoyancy in the abyss (Season 5G) : Biting the silver bullet

Amidst Google and FB’s $10B bet on Jio nothing much to write home about proving Telcos' inability to crack the code yet again, will 5G flip fortunes ?

As it stands today, to say that Indian telecom is just a means to an end , would be stating the obvious. Reason why its Jio platforms thats headed for an IPO?with Jio Infocomm as its subsidiary. By that inference, any consumer centric investment ploughed into telecom needs to contribute value for it’s respective telco’s digital / digital commerce game plan.

Even as Google and Facebook’s year old $ 10 B bet on Jio not exactly turning out to be the golden egg laying goose , Moody’s casting grey skies over India’s 5 G opportunity (has forecasted that only 7% of India will adopt 5G by 2025), comes as a sentiment damper.?

5G as a theme for a dream - The many a slip ‘twixt the cup and lip.

China’s supremacy in 5G remains unquestionable. However , despite achieving? > 70 % of mobile tower fiberization the chairman of China’s leading Telco , Unicom , has gone on record that 5G’s steep operational costs has constrained them to shut electricity supply to base stations from 9pm to 9 am next day.

Cut to India story where only 30 % of?mobile towers are fiberized. Using 5G handsets served by mobile towers not connected on fibre is like driving a Ferrari in a traffic jam. So India will need to sustain high operational costs alongside prohibitive additional capex to light up colossal number of mobile towers with fibre. However, the ground reality is that Telcos ,including Jio, are hiving off fibre assets to pare debt due to lack of business case.?

Business case - Beyond the hype:

Sure 5G’s blazing speeds is lightyears ahead of 4G but with today’s video compression technologies (Google’s Lyra is promising high quality video @ 56 KbPS dial up modem) , HD quality Zoom meetings on laptops *work seamlessly with a throughput (actual speeds) of 4 MbPS. Suddenly, need for super speeds becomes inconsequential to the mass market,

The 3 things that sell in India are..:

.. Entertainment, Entertainment and Entertainment !! Monetising content to a respectable level remains a pipe dream.?A recent survey conducted by a leading Telco to understand the reasons why their existing?DTH subscribers were discontinuing recharges revealed that free streaming clips and video sharing platforms viz. Tik Tok (and more recently “You Tube shorts”) not just gave them enough juice but also on-demand flexibility at much reduced monthly outgo. Given the current unsustainable tariffs, this becomes a catch 22 situation for Telcos banking on telecom as a means to an end.?

5Gi, its related policy ambiguities and backwards compatibility with NextG alliance :

In its determination to ring-fence China out, an upcoming rapid development NextG alliance (spearheaded by companies including Google , Apple , Facebook , Ericsson , Intel , Microsoft , Nokia and Samsung) is in the works.?

India, on its part,?has set itself out to develop its indigenous 5Gi standard which has received approval from International Telecom Union (ITU). The focus of 5Gi is to enhance rural coverage and is incompatible with global 5G standards. As the way it stands, for reasons stated above, 5Gi does not seem to be in sync with business needs.?

Bottomline, unless 5G i is incubated under the aegis of a purple person with sweeping powers?presiding over Empowered Group of Ministers not just to chalk fostering policies but to implement them, the sector is better off with its existing mountain of debt.?

If India has demonstrated?its acumen in space technology , there is reason to believe it can do it in telecom as well !!

For now, research and development is hard to thrive under the current hyper-competitive climate.?

*NB: While there are appox. 150 possible situations (w.r.t wired broadband) that can cause hiccups, its usually the bandwidth that lands up getting the flak.?