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In the history of telecommunications, after the advent of cellular technology, 5G is poised to mark a significant impact on not only telecommunications but almost every element of the economy.

After connecting humans, this generation of cellular technology has the ability to connect almost everything, what we have been calling as IoT over the past few years. In telecom history, the advent of IP technologies started overhaul of legacy infrastructure. Similarly, 5G will result in replacement of legacy infrastructure in almost every industry and sector. Even if the industry is already hi-tech, 5G will still require substantial upgrade.

The way we do agriculture, education, healthcare, energy, governance, commerce, entertainment; almost everything gets redefined with 5G. It will lead towards more autonomously driven technology capable of thinking basis the intelligence and compute that is possible with 5G technology as the basis.

This opens up huge opportunities for investment and growth. We have been witnessing digital transformation in several industries so far. 5G will further make that meaningful and in essence would be the real digital transformation. For example, some of the digital transformations have been about using digital tools and ERP applications. Now with 5G the whole process gets digitalised. The point is even in the sectors which from investment point of view weren’t looking lucrative will have a promising outlook with 5G as most of them will move to XaaS (everything as a service) business model and the past half a decade has shown us the phenomenal growth of as-a-service business models. The sprouting unicorns, even in India, are mostly having this business model.

Investors, going forward will have to calculate the technology quotient in any potential investment and the ones which will have a higher quotient will not only be ensuring higher returns, but they will also enjoy longevity and sustainability. This is where 5G will play a critical role in letting every sector convert its investment into a highly rewarding investment besides making it sustainable. For example, in food storage, the entire value chain becoming connected in real time could help in defining variable pricing basis freshness of produce. With 5G grading of food like fruits and vegetables can be done on freshness of the items opening up a potential investment window with sustainable and higher returns.

Since the advent of 4G we have seen tremendous growth in several sectors. Not only that many new sectors have set in. For instance, an app led economy where so many businesses are run through apps which need broadband connectivity to add value. From food aggregation to ecommerce, all is powered through such apps. In such applications also, 5G will bring more immersive-ness through metaverse which will make digital experience more tangible, addressing the feel aspect if not touch, which is considered the USP of offline selling.

With 5G the telecom operators will move beyond offering connectivity and content. After 4G the telecom operators started offering content along with connectivity. But with 5G they will start offering services and applications in the digital format. Many of the operators have already become banks and entertainment houses.

Now they can become factories, construction companies, energy suppliers, infrastructure providers and a lot more. This will increase immense revenue opportunities for the sector and after seeing a slump for several years now, the tides will change for the industry. Even if 5G is launched in India in a couple of years and by 2025, it’s a service with a substantial user base, say more than 200 million users, we could expect the telecom industry to guzzle profits between 2030-2045. These are going to be profit years for the sector because of 5G.

However, to achieve this one we need to pace up our journey to kick start 5G. Covid-19 has definitely slowed pace on 5G as the industry priorities changed including that of the government. But we need to now expedite to leverage the potential that 5G unleashes. The main impediment here has been spectrum pricing which needs to be looked at prudently keeping in mind the far reaching consequences of 5G as a technology not only for the telecom sector but the entire economy. If we have to move towards a digital economy fast and inclusively, we cannot do that by only having the services sector of the economy in digital mode. We need to get to the agriculture and manufacturing sectors too, where 5G technology becomes essential in areas like smart agriculture, connected manufacturing, etc.

The government’s vision of India becoming a digital economy creates the positive broader sentiment for 5G. In fact, if played to its full potential, India could become among few first digital super economies globally. But for that, we have to adopt a wealth maximisation thought process rather than the revenue gains in the short to medium term. With every year’s delay in 5G we are losing precious time for this journey.

The positive thing is that from a consumer standpoint we already have close to 5% of the smartphone user base in India with a 5G smartphone in their hands and by 2022 end, it’s expected to jump to over 13%. Now we need a network which can set in motion the entire value chain.

From the industry point of view, for all the telecom operators 5G has a positive connotation. Be it the youngest in the industry – Jio or the incumbent like Airtel, 5G will positively impact their financial health as well as make them super platforms where both can host a number of enterprise and consumer services and applications. Same holds true for Vodafone idea, which can see this as a turnaround technology after turbulent 3-4 years. To conclusively predict who will benefit the most it’s too early as that shall be determined on their respective 5G execution, but it will substantially widen their addressable market opportunity as well as the ARPUs. 5G will affect both the top-line and bottom-line revenues for the telecom players.

The consumer is living a smart tech lifestyle. As against a laptop and a smartphone, today a consumer can leverage 15-16 such smart and intelligent devices not only adding to the convenience but also to the productivity. Covid-19 experience has shown us beyond lab results, how digital connectivity and lifestyle helped us maintain a living standard when death was in the air.

Way forward

5G is the technology upon which the future of any economy rests. The smart use of 5G will be a key differentiator between a digital economy and a digital super economy and that is what India needs and deserves to be.

Not only from the economic perspective, but the changing geopolitical scenario, 5G has strategic relevance. The potential and imminent threat of cyberwarfare moving to real time cyberwarfare is visible in times to come and we need to have a technology that can power it, which again is the 5G.

From the social angle, India still has to balance out growth in several sectors like healthcare, education, social security and employment. The physical infrastructure development of the magnitude and scale required might always remain out of access. It will be extremely difficult and a resource drainer to reach 100% in such goals. However, a Phygital hybrid model can always spread and extend the infrastructure widening the impact. This is where 5G becomes the bedrock of everything – growth, power, prosperity and future.

The writer is founder, Techarc


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