India is at the cusp of a digital revolution powered by increasing broadband and internet penetration, exponential data uptake, the Government’s focus on digitalization and increasing trend of technology adoption across different industrial sectors of economy. This revolution is likely to generate new growth avenues, boost industrial productivity, create new jobs, new skill sets and has the potential to transform the socio-economic fabric of the country. In addition to 5G providing significant network performance characteristic improvements over the previous generations, it is expected to also add various service dimensions beyond the traditional voice and data through enabling technologies like Internet of Things (IoT), Artificial Intelligence (AI), Robotic Process Automation (RPA), Augmented Reality / Virtual Reality (AR / VR) giving rise to use cases across industry verticals.
New business models and intermediaries are emerging in the 5G value chain to cater the need for connectivity and for providing differentiated services to niche market segments as well as customers. 5G is defined as a mobile broadband technology that meets the requirements and specifications that appear in the IMT-2020 Specification, adopted by the International Telecommunication Union – ITU. With the rise in mobile phone penetration and uptake of data services, India’s internet economy is expected to double from US$ 125 Billion as of April 2017 to US$ 250 Billion by the year 2020, backed primarily by eCommerce. India’s eCommerce revenue is expected to jump from US$ 39 Billion in 2017 to US$ 120 Billion in 2020, growing at an annual rate of 51%, the highest in the world, contributing to around 5% to the GDP. This is likely to grow by 1.5 – 1.75 times in next 2 – 3 years. During Covid – 19 times eCommerce came as a big saviour for many families across the nation and this sector was opened for the benefit of the common man.
It is believed that India’s digital economy has the potential to reach US$ 1 Trillion by the year 2025, primarily driven by increased proliferation of smart devices / phones, increased internet penetration, growth of the mobile broadband, growth of eLearning tools, work from home (WFH) environment due to Covid – 19 pandemic, growth of data consumption by streaming and new releases over OTT and social media growth and awareness.
The ‘G’ in telecom networks refer to generations and each generation of technology in wireless communications means increasing the amount of information the radio waves can carry. The 5G networks are much faster than the equivalent 4G networks and support a much higher number of devices in a given area. The price is that unlike the current 3G and 4G, 5G cannot travel long distances and needs a number of repeater hops, or cells and antennas, to travel the same distance. A 5G network can provide the same speeds that a fibre optic cable network provides, without the large cost of physical cabling to the door step, which is being done by JIO to capture the market very quickly. It can, therefore, reach less dense population centres including rural areas with high-speed internet at much lower costs.
Who are the big players in the 5G space? The other major players apart from Huawei are Samsung (South Korea), Nokia (Finland), Ericsson (Sweden) and ZTE (China). While the US has no major player at the network equipment level, it has Qualcomm that manufacture wireless components and chipsets and Apple which is the market leader in smartphones. The first country to adopt 5G on a large scale was South Korea, in April 2019. Swedish telecom giant Ericsson has predicted that 5G internet will cover up to 65% of the world’s population by the end of 2025.
The Global Cybersecurity Index (GCI) is a composite index produced, analysed and published by the International Telecommunication Union (ITU) to measure the commitment of countries to cybersecurity in order to raise cybersecurity awareness. The GCI is rooted in the ITU Global Cybersecurity Agenda (GCA) that was launched in the year 2007, and reflects its five pillars: legal, technical, organisational, capacity building and cooperation. The GCI combines 25 indicators into one benchmark measure to monitor the cybersecurity commitment of 193 ITU Member States and the State of Palestine to the five pillars endorsed by the Global Cybersecurity Agenda (GCA). India’s Asia Pacific rank is 10 with index of 0.719 and global rank of 47 which is quite low. UK leads the nations with GCI index of 0.931. India has to spend and research on cyber security for sure, and which becomes a basic necessity when 5G network is implemented.
5G is envisaged to be the key catalyst that will revolutionise connectivity. 5G is around the corner and there is an ever – increasing euphoria amongst the Telecom Service Providers (TSPs), the TMT (Technology, Media & Entertainment, and Telecommunications) ecosystem and the consumer community at large at the vast opportunities 5G will bring. Simply put, 5G is expected to be significantly smarter, faster and efficient compared to its legacy 3G and 4G predecessors. For instance, it holds a promise of 100 times more speed relative to 4G networks. The possibilities, with a network like this, are unfathomable. We may see a total 2G Mukt Bharat soon in our nation.
Local governments are struggling to respond to the current pandemic and many technologists believe the massive connectivity, edge compute and ultra-low latency capability of 5G could help. Many people think of 5G as the next generation of cellular network technology only. This is in past because telecom companies have been rolling out 5G test markets and touting the upgraded network’s benefits. As The New Yorker summarised, “5G … is expected to be up to a hundred times faster” than 4G. On one hand, the new features and specifications being released as upgrades for LTE are enabling telecom companies to reduce the capital expenditure and operational expenditure on network deployments through improved spectrum utilisation, energy efficiency and network densification through small cells, on the other, the features also focus on improving network performance. 5G is characterised by greater peak data rates, higher throughput, lower latency and high connection density as compared to 4G networks, thus is expected to result in improved user experience.
Global early bird 5G timelines by Telcos
|Country||Moving Towards 5G|
|USA||AT&T will introduce mobile 5G through portable hotspot to customers in few cities across the US at the end of year 2018; Verizon is rolling out commercial service over 5G fixed wireless networks in several cities partnering with OEMs Samsung & Ericsson (year end 2018) on millimetre waves; T-Mobile committed to a massive, multi-year investment in 5G networks partnering a deal of USD 3.5 billion with Nokia with complete suite of equipment and services to start deployments in 2019; and Sprint will launch mobile 5G services on its 2.5 GHz spectrum holdings on a nationwide basis in the first half of the year 2019.|
|China||China Mobile is conducting trials for 5G in a string of cities and will start pre-commercial use of 5G by the year 2019 before its commercial launch by 2020 with an expected ~ 10,000 5G base stations across locations; and China Unicom will start 5G test this year, pre-commercialise 5G in 2019 and is expected to achieve largescale commercialisation by the year 2020.|
|Italy||Telecom Italia (TIM) is already offering 5G in nine cities, including Rome, Turin, Florence and Naples, and will do so “soon” in other cities like Milan. The aim is “to cover the entire population by 2025/2026|
|Germany||5G services are available in more than 1,000 towns and DT is tracking to reach 50% of Germany’s population, or 40 million people by mid-July, 2020. That’s an acceleration from the earlier target of the end of 2020. This is the largest 5G initiative in Germany.|
|Russia||Huawei 5G has gone live in Russia. This isn’t the first 5G pilot to launch in Moscow, but it is the most notable. It is based on an agreement signed between China’s Xi Jinping and Russia’s Vladimir Putin at the 2019 St Petersburg International Economic Forum (SPIEF).|
|South Korea||SK Telecom has formed a 200-member task force to fasten commercial launch of 5G services and has acquired spectrum in the 3.5 GHz and 28 GHz frequencies for coverage and hotspot based capacity; and Korea Telecom is expected to launch its commercial 5G network by March 2019. It had earlier completed 5G trials during the Winter Olympics Games in the city of PyeongChang with 5G-driven visual technologies.|
|Australia||Telstra has conducted 5G network data call trial with Ericsson and Intel as a part of Telstra 2022 strategy and is planning to deploy its 5G network with full commercial deployment expected in the year 2020 in high demand areas.|
|Norway||Telia opens up its 5G network to customers in Lillestrøm and parts of Groruddalen in Oslo. During 2020, the 5G coverage will be extended throughout Oslo and it will also be launched in Trondheim and Bergen, which are major cities of Norway.|
|Africa||5G has finally arrived on the African continent. Vodacom announced the launch of its 5G mobile network in Johannesburg, Pretoria and Cape Town. The launch encompasses twenty live sites.|
|Sweden||Telia Sweden inaugurated its first major commercial 5G network in Stockholm. The network has been up and running for a number of weeks already. 15 base stations are already in place, and during June, 2020 a further 60+ will be built. The 5G network will cover most of central Stockholm by Midsummer.|
|UAE||The Jumeirah Lakes Towers (JLT) district, one of the largest residential areas in new Dubai, is set to become the first 5G powered district in the Emirate. Once the 1st phase is launched at JLT, over 16,000 companies and 100,000 people will be able to benefit from the 5G network. Both Etisalat and du have rolled out the 5G in the UAE. The two telcos have also announced plans to expand the service.|
|Singapore||Singapore’s biggest telecom operators chose Ericsson AB and Nokia Oyj as their main 5G network providers, leaving China’s Huawei Technologies Co. with less significant contracts in the city state. Singtel and the StarHub-M1 group plan to introduce a standalone 5G network starting from January 2021. The country aims to have 5G coverage for at least half of the nation by the end of 2022 and the entire island by 2025.|
|Finland||Telia has over 3 million users in Finland and it cover the whole Baltic Sea area.|
|United Kingdom||Vodafone shall be using frequencies in its 3.4 GHz band for 5G trial across seven cities in UK and is expected to commercially launch in the year. Huawei has been shown the exit door inspite of huge lobbying and close contacts with David Cameron and Ms. May. BoJo has given time till 2027 for its total exit. It may be even earlier as security concerns in the western world is very high.|
|India||In India, all industry stakeholders are actively involved in earnest endeavour to commercially launch 5G by 2020, but now doubtful due to Covid – 19, through investments in R & D, formulation of test beds, technology trials for deployment and study of use cases. The Telecom Regulatory Authority of India (TRAI) is simultaneously working on the spectrum plan for 5G focused on global standardisation, aligning the spectrum plan with global spectrum allocations for 5G and spectrum harmonisation to facilitate this endeavour; Currently, the industry has ~471,000 towers across the country. Since, India is set to witness a multi – fold increase in data consumption, the industry is expecting to foresee at least 100,000 more towers with an approximate investment of US$ 2.78 Billion in the near future to stride towards ‘Digital India’ initiative and sheltering possibilities for deployment of new technologies including 5G and IoT. Since, high frequency spectrum bands will also be considered by telecom operators for the deployment of 5G networks, it is expected to result in low coverage deployments, thereby, restricting and localising services. In order to promote ubiquitous network connectivity and quality through densification of network, telecom operators are seen investing in small cells, fibre networks, in-building solutions, and Wi-Fi hotspots. This eventually is expected to have a bearing on infrastructure providers as well, since the infrastructure requirement will be paramount to implement any of the above mentioned scenarios. Furthermore, ‘Digital India’ initiatives like ‘BharatNet’ and ‘Smart Cities’, along with high rate of fiberisation across various parts of India have brought telecom tower companies’ implementation capabilities to the fore; In an effort to prepare its officers for 5G computing and internet of things (IoT), the DoT has decided to rope in Thailand-based Intergovernmental Organisation Asia – Pacific Telecommunity (APT). The training this time will, however, be held online due to international travel restrictions. The training was necessitated again as it was felt that the officers should be refreshed on the training they had received in 2017, after which the 5G technology had changed a lot. The APT had in July this year written to the DoT to send nominations for officers by August 6 and had invited applications from all departments of the administration, including the DoT. In the online training session this year, APT plans to train selected officers in 5G network and its perspective design applications as well as artificial intelligence or smart computing to create digital services. The DoT also aims to create a pool of experts on 5G computing and IoT services which can work towards capacity building on new technological knowledge and also help other departments as and when the new technology is rolled out. India’s rollout of 5G has been hit severely due to the pandemic. The government had planned auction of 8,300 MHz spectrum, including in the 5G band in 2020. However, with two of the three private telcos reeling under debt and the government unwilling to lower the base price of the spectrum, it is unlikely that the private players would opt to spend money on 5G; and Fibre backhaul is critical for deployment of next generation technologies and high speed 5G network infrastructure. India aims to increase its fibre backbone to 2.5 million km by the year 2022, up from the current 1.5 million km.8 To facilitate this deployment, the government streamlined the Right of Way (RoW) policy in 2016. This also included streamlining of application procedure, ‘single-window’ clearances, dispute resolution in a time bound manner, along with rationalising administrative expenses across the entire approval process.|
By year 2023, approximately 1 billion 5G devices are expected to be connected worldwide. Pioneers in this space, such as Qualcomm, Mediatek, Huawei, Intel and Samsung have already unveiled a slew of pre-commercial 5G chipset versions. Moreover, test trials are being conducted across multiple 5G enabled devices such as smartphones, laptops, Customer – Premise – Equipment (CPE) and pocket routers. The advent of 5G networks with AR / VR capabilities is expected to open up demand for new series of devices. But the technologies framed within the 5G network architecture are intended to provide capability far beyond improved speed and lower latency to your phone and streaming services. 5G will enable ultra-reliable communications and computing capabilities at the edge. Edge computing brings compute, storage and networking closer to applications, devices and users. Pandemics and public health emergencies present a need for widespread data, monitoring and reliable wireless networking. The way to enable front-line pandemic fighters (like medical personnel and first responders) is with an upgraded network providing time-sensitive operation, a range of low to high data transmit capacity and cellular network small cell densification.
The latest move by US government attempts to cut Chinese companies out of the US networks. On 5th August 2020, the US State Department announced the creation of the ‘Clean Network’ initiative, a plan devised to help protect US networks from high – risk Chinese companies that may be compromised by the Chinese government. Announcing the plan, Secretary of State Mike Pompeo said that the programme will have five facets: Clean Carrier, Clean Apps, Clean Store, Clean Cloud and Clean Cable. The main aim of the US is to curtail the growth of Chinese companies ZTE and Huawei from the North American network altogether. Relations between Canada and China have also deteriorated over the arrest of Huawei executives. In brief:
Clean Carrier will mean that no Chinese telecom carriers are connected to US networks. As part of this process, Pompeo urged the Federal Communications Commission to revoke the licences of China Telecom and other Chinese operators doing business in the US;
Cleans Store will mean that untrusted Chinese apps are removed from US app stores;
Clean Apps will mean that some US apps will no longer be available on smartphones manufactured by the Chinese vendors;
Clean Cloud will limit the amount of US data Chinese cloud providers can store and process; and
Clean Cable will mean that US submarine cable networks will be scrutinised to ensure they are free of the Chinese influence.
This umbrella strategy is not entirely unprecedented; back in April, 2020 the US government first introduced its 5G Clean Path strategy, whereby untrusted IT vendors would be entirely excluded from the State Department systems. Though far greater in scale, this Clean Networks strategy is a clear continuation of this previous policy. This announcement comes at a time when tensions over the Chinese app TikTok are at their peak. Given the apps surging popularity, the US government has stoked fears that US citizens’ data may be being shared with the Chinese government, leading to discussions about banning the app altogether via an Executive Order. In the last few days, however, tensions have begun to soothe as a result of Microsoft entering negotiations to purchase the app, which would circumvent sanctions the US Government is threatening to impose. Naturally, this Clean Network plan has been poorly received in China, with the Chinese foreign minister Wang Yi describing it as attempting to draw an “iron curtain” around the US; a little ironic, given China’s infamous Great Firewall. Economic retaliation seems likely, though exactly how is unclear – Apple and Tesla, as some of the few US companies who hold significant business interests in China, would appear to be the obvious targets.
If this policy does become enacted at scale, the digital divide between China and the US will grow considerably, with Pompeo hoping to push allied countries to take a similar stance. “The United States calls on our allies and partners in government and industry around the world to join the growing tide to secure our data from the CCP’s surveillance state and other malign entities,” he said. “Building a Clean fortress around our citizens’ data will ensure all of our nations’ security.” China says the US concern is nothing but an attempt to hold the country down by denying Huawei its legitimate place in a competitive world. The fact though is that none of the Huawei’s competitors enjoy similar backing of their Governments while also being subject to its dictates to spy for the Chinese army. For the US and other countries worried about the Huawei’s control at the 5G till, what is at stake is not profit but vulnerability of the world enmeshed in new technologies. And if that company happens to be under the thumb of a one – party state engaged in Orwellian control of its population, the danger to the new world order or disorder will be unparalleled in history.
The UK joins democracies such as the Czech Republic, Denmark, Estonia, Latvia, Poland, Romania, and Sweden in banning Huawei from future 5G networks. “Clean carriers like Jio in India, Telstra in Australia, SK and KT in South Korea, NTT in Japan, and others have also prohibited the use of Huawei equipment in their networks”, this was stated by Mike Pompeo.
India is dominated by the millennial population with median age of 27 years, which represents a customer base that is not only young, but also increasingly digital. This demographic segment accounts for 61% of internet users and 78% of online shoppers. The voice of this digital customer demands an enormous amount of high speed mobile data and ubiquitous connectivity to meet their specific needs such as media streaming (video and audio) with improved content and quality (e.g., 4K / 8K UHD), over – the – top (OTT) mobile content (e.g., Netflix, Amazon Prime Video) and far richer user-created content (e.g., WhatsApp, Instagram, Facebook).
Reliance is a front runner to occupy not only the Indian telecom space but will definitely become a global leader in the 5G space. My assessment of Reliance’s strategy based on recent deals in JIO Platforms is as follows. Reliance plans to dominate all six technological segments required by any telecom company to be a leader:
The core technology segment (the 5G switch with Qualcomm);
The mobile telephony segment (with Jio);
The handset segment (with Apple);
The OS segment (with Google);
The consumer segment (with FB, Google, and other apps);
The infrastructure segment (with Microsoft’s Azure Cloud and Google’s Cloud); and
Finally an endorsement from US to become India’s Most Precious Company.