5G to drive mobile data revenue by 67% in India by 2026: GlobalData

Fifth-generation network or 5G will drive mobile data revenue by 67% and mobile data usage by 29% in India between 2020-26, according to forecast by GlobalData released Thursday.

This is despite “unfounded concerns” around radiation levels or “worries” around higher prices [of 5G spectrum], the research firm said.

“Airtel is already testing 5G equipment. However, questions remain over whether it can afford to build 5G meaningfully. Reliance Jio’s massive financial resources and existing market position will likely allow it to gain a market-leading position. Vodafone Idea, on the other hand, is likely to struggle due to its weakening customer base and financial position,” said Priya Toppo, Analyst in Thematic Intelligence team at GlobalData.

The government will start the 5G spectrum auction from July 26. Telecom minister has said that 5G deployment would begin in 20-25 cities, towns, by late-2022.

However, telecom companies and technology firms are currently at loggerheads over the Cabinet’s decision to allocate 5G spectrum directly to enterprises for allowing them to set up their captive private wireless networks (CPWNs). Analysts have predicted that this issue, coupled with high spectrum prices, may lead to a muted demand for airwaves at auction.

In the meantime, GlobalData noted that the “majority of Indian consumers are still uncertain about the adoption of 5G, considering the imminent increase in data charges and smartphone prices, especially in rural regions” and most of the mobile subscribers will still be using 4G services.

As a result, GlobalData forecasts only 27% of the country’s mobile subscribers (around 329 million) will be using 5G services by 2026.

“Despite higher data prices, 5G promises superior service quality compared to the existing 4G networks. This should encourage digital businesses including edtech, healthtech, agritech, fintech, and e-commerce to further accelerate 5G adoption in India,” added Toppo.