India is unlikely to witness 5G rollout at scale at least till financial year 2023 (FY23), while spectrum auctions are expected in 2021, according to a Credit Suisse report.

“Historically, India has lagged developed Asian peers by 2-12 years in mobile technology adoption (3G and 4G) and we expect the trend to continue in 5G as well. India is yet to conclude 5G auctions and we expect auctions in 2021 post revision in reserve price,” it said.

“Unlike 4G rollout, we expect 5G roll out to be gradual in India with about 15 per cent penetration by FY25 given: (1) stretched financial position, (2) operators focused on monetising 4G, (3) lack of compelling use cases and (4) no new entrant threat,” it added.

‘No killer app yet’

While the proposed 5G applications are potentially exciting (Augmented Reality, virtual reality, autonomous vehicles and smart factories), there is no 5G ‘killer app’ for mass market consumers as yet, in the way that streaming media was the catalyst for 4G uptake.

As a result most 5G launches so far have focused on high-volume data bundles and 5G handsets, rather than apps, and generating a return over heavy 5G investments is proving a challenge.

Given the lack of apps to drive ‘demand pull’, many operators globally are using high volume data bundles (at some premium to 4G) along with handsets in 5G to entice subscribers.

In China and Korea, Average Revenue Per User and revenue have grown with 5G launch, but not sufficiently to generate an attractive return on capital, and, hence 5G monetisation remains a challenge.

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