Indian telecom operators are currently facing challenges in monetizing 5G networks, especially as mobile customers are accessing it without direct costs. The demand from enterprises for 5G services has been limited, and the available use cases at the enterprise level are constrained. Consequently, there is insufficient incentive for enterprises to swiftly adopt 5G technology. However, a potential solution is on the horizon. Once the government grants approval to telecom companies for leasing spectrum to enterprises, enabling the establishment of 5G private networks, it could significantly boost the revenues of these operators.
In India, enterprises have the opportunity to obtain spectrum from telecom operators to establish private networks. The Department of Telecommunications (DoT) is expected to soon announce regulations regarding the leasing of spectrum for private networks, providing telecom companies with a new avenue for revenue generation. Although this method involves monetizing the 5G spectrum rather than directly earning money through 5G network services, it represents a potential source of relief for telecom operators seeking additional revenue streams.
According to a report, the revenues generated by a telecom company through leasing 5G spectrum will be considered part of the gross revenue, subjecting it to license fees. Major players like Jio and Airtel, which have already rolled out 5G in various regions, eagerly anticipate the opportunity to lease spectrum to enterprises for the establishment of Captive Non-Public Networks (CNPN). Additionally, telecom companies may opt to directly set up private networks for enterprises as a means of revenue generation.
Private 5G networks hold the potential to facilitate advancements in smart manufacturing, smart logistics, and other innovative applications. Telecom operators intending to lease spectrum must inform the government each time they engage in such agreements, especially with entities holding CNPN licenses. Furthermore, private network operators are required to obtain clearance from the standing advisory committee on frequency allocation (SAFCA) before commencing operations. This regulatory framework aims to ensure a systematic and secure deployment of private 5G networks in the country.
