Govt won’t allocate 5G spectrum to private companies setting up networks

The government has decided against allocating spectrum administratively to private companies wanting to set up their own 5G networks for own use, a top official said, while adding that the communications ministry was more favourable to leasing of network capacities from telecom service providers.  

While the option of taking 5G spectrum at the auction-determined price has been kept open for private companies, the decision will be a boon for telcos such as Bharti Airtel, Vodafone Idea and Reliance Jio, since as an industry about 40% of their revenues come from enterprise businesses which would have been severely impacted in case of an adverse decision.

“The best way to go forward in this direction is through leasing, telcos have the capacities, in any case private enterprises wanting to connect to a network will need to connect with the main (telecom service provider network),” the official said, asking not to be named.

“Creating a separate category needs a lot of consideration,” the official added, indicating that the government was not in favour of creating a distinct category of licence holders for captive wireless private networks. Telecom companies have previously stated that private network providers should be treated at par with telcos if they’re given licences for using 5G spectrum and therefore be subject to the same taxes, levies, security and compliance conditions as telcos.

Meanwhile, the decision on reducing the reserve price for 5G airwaves and extending the period of the licence to 30 years from the Trai-recommended 20 years, is likely to be taken by the Union Cabinet, even as DoT’s highest decision making body — the Digital Communications Commission — has accepted most of Trai’s recommendations including those on spectrum prices and keeping duration of the licence period to 20 years. 

“There is always the option to increase it to 30 years, but let us see what the Cabinet decides... pricing also we will wait for Cabinet,” the official said.

The government is planning to hold auctions in June-July months, with the plan to begin offering 5G services locally by August, albeit on an indigenous platform being developed by a TCS-led consortium with C-DoT, which is holding commercial discussions with public sector carrier Bharat Sanchar Nigam Limited (BSNL).  

BSNL has been conducting trials for 4G networks with a TCS-led consortium which includes C-DoT as a technology partner.  

“The 5G core is practically ready and will be launched in a few weeks. This will become the 5G stack. So there will be core, radio equipment and handset on 5G, the full technology stack available. The world will have a true competitor from India,” the official said.  

He added that the indigenous stack — which is also 4G ready — will be able to provide 5G technology at a fraction of the investments made by global companies in the arena, the government has already made a provision of ₹45,000 crore for BSNL to roll out the 4G network in FY22 Union Budget.