By Dr. Jaijit Bhattacharya
Market leader Reliance Jio and Bharti Airtel have been investing heavily in aggressive next generation networks rollouts while monetisation on the back of much-touted enterprise uptake appeared to be a daunting task.
The primary issue is how the government will ensure that we have a sustainable telecom industry. The disproportional data traffic started with COVID-19-led shutdowns since earlier people were not using OTT so much.
It (5G) has not yet enabled any new business model or use case globally, thereby not generating significantly more revenues that could justify the investments made.
Market leader Reliance Jio and Bharti Airtel have been investing heavily in aggressive next generation networks rollouts while monetisation on the back of much-touted enterprise uptake appeared to be a daunting task. The average revenue per user (ARPU), according to him, has been stagnant and there has been a near-saturation situation in mobile subscribers. India has nearly 1.20 billion mobile users currently. In India, telecom carriers ARPU is close to Rs 150 as compared to worldwide average of about Rs 700, and Rs 580 in China, as per industry estimates. Earlier, Mumbai-based Crisil Ratings said that telecom operators require an ARPU between Rs 270-Rs 300 over the next three years to realise their investments in deploying 5G networks.
The large traffic generators (LTGs) should share fairly, and a relevant model could be worked out. South Korea and Netflix have shown a way to go. The strain on networks started from the COVID time. These are complex regulatory issues, and will take time in resolving. those models have lately started to come up in India with both Jio and Airtel offering bundled packages. Incumbent telecom operators led by the Cellular Operators Association of India (COAI) and London-based GSMA have been demanding a fair share from over-the-top (OTT) players generating data traffic on their networks. On the flip side, OTT players and technology providers have been arguing that any move to regulate them may stifle innovation, a charge strongly denied by telcos. The Telecom Regulatory Authority of India (Trai) has been in the process of framing views on whether OTT firms should come under the regulatory ambit. In addition, there has been a proposal in the US Congress making large internet apps contribute to infrastructure costs that could help lower broadband costs for consumers.