After three years of telecom companies' deployment of 5G services worldwide, the Indian telecom industry has greeted the long-awaited next-gen services as a mark of inevitable stride. The shift from 2G - which was launched in 1991 - to 5G has resulted in rapid upgradation in customer experience.
While still at a nascent stage and undergoing phased deployment across the country, the 5G service is expected to contribute up to 2 percent of India’s GDP by 2030, amounting to approximately $180 billion, according to a report by NASSCOM, the technology-focused trade association and advocacy group.
Internet penetration in India has been advancing faster than the other countries in the past and is poised to grow significantly higher in the future as well. The rise in internet penetration in India, according to the report, is mainly attributed to the smartphone revolution and the Digital India initiative.
Telecom subscriptions in India saw a CAGR (compound annual growth rate) of 3.37 percent between 2015 and 2019. Meanwhile, during the same period, internet subscribers in India grew at a CAGR of 20.5 percent, the report added.
Data consumption in India saw an unprecedented jump from a mere 828 million GB in 2014 to 76,320 million GB in 2019, at a CAGR of 113 percent. A little over 40 million new users were added to 4G in 2021, with a total count standing at 740 million today. The report also added that there are 10 million active 5G handsets in India, with 30 million new shipments received in 2021.
By 2025, the number of 5G connections is estimated to be in excess of 4 billion, representing 35 percent of total connections. 5G mobile subscriptions are expected to grow at a CAGR of over 50 percent across the globe and are likely to enable a $1.5 trillion revenue potential by 2030, according to the report.
There is expected to be a significant uptick in the customer base owing to increasing demand for enterprise solutions offered by the technology.
This rise of 5G technology is due to growth in demand for low latency high-speed internet connections, and it is further fuelled by the Covid pandemic, which pushed for the digital transformation of industries and increased the strain on networks.
Key drivers for 5G’s aggressive growth in India
According to the report, policies such as the National Optical Fibre Network (NOFN), which plan to connect all the 2.5 lakh gram panchayats in the country, will help enhance India’s potential for 5G adoption by increasing accessibility and affordability.
A substantially aggressive rollout plan coupled with speedy 5G adoption across customer segments and geographies will also enable aggressive growth. Another key driver would be using PLI to expedite device production and turning India into a Global Manufacturing Hub for 5G devices & components will soar exports.
Affordability would also play a key part in the aggressive growth of the next-gen service in the country.
Billionaire Mukesh Ambani recently said Reliance Industries Ltd.’s 5G network will cover the remotest corners of India by December next year, providing services “more affordable than anywhere else in the world.” The technology can bring affordable, superior education and skill development to ordinary Indians and deliver high-quality healthcare to rural and remote areas, Ambani said.
Meanwhile, Airtel CTO Randeep Sekhon said recently in reports that globally, there's not a major difference between 5G and 4G tariffs.
"We expect 5G plans in India to be similar to 4G tariffs," he had said.
5G deployment at grassroots
All industries are going through a revolution in digital transformation. The path to digitisation demands low latency and massive machine communications for effective functioning.
Meanwhile, sectors across the Indian market are anticipating new possibilities aided by 5G services. Drone-led precision farming can reduce input costs by 18-20 percent while enhancing yield by 30-100 percent in India. 5G can bring down the cost of logistics to 5 percent from 13-14 percent at present. The service can also ease the burden on hospitals specialising in critical care, used by 80 percent of patients in rural India, the Nasscom report added.
For the energy industry, 5G can enable 250 million smart meters, to be deployed, to track electricity consumption with 99 percent accuracy. For the logistics industry, the technology can enable retailers to achieve a 70 percent reduction in shrinkage, and sales lift by up to 7 percent, according to the report.
With cheaper smartphones and data, India is seeing a remarkable rise in digital connectivity. This is a demand that only 5G can cater to effectively today. Telcos already are on the path to this goal. Though India lagged behind its counterparts in the deployment of previous-generation technologies, 5G deployment is scheduled to reach metro cities within 2022.
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