5G rollout in Delhi is also estimated to cost Rs 8,700 crore, only in Mumbai 5G will require an investment of 10 thousand crore rupees.
India may have taken time to adopt technologies like 2G and 3G, but it is moving fast in 4G and 5G. While the country’s telecom companies took 3-5 years to adopt 4G, it may take even less to adopt 5G. According to a report by Motilal Oswal Financial Services, a total of 1.3 to 2.3 lakh crores will have to be spent for 5G networks including spectrum, sites and fiber across the country.
India’s position in 5G mobile network
The entry of 2G and 3G mobile networks in India was 8 to 10 years later than in developed countries. Whereas 4G mobile network also came to India after 3-5 years in 2014-16. Now the big companies of the world in India are in constant contact with the government for 5G trials regarding the launch of 5G mobile network.
In this direction, the owner of Reliance Industries Mukesh Ambani said in the annual meeting of the company in July that Jio has prepared and developed the 5G technology. This 5G spectrum will be ready for trial as soon as it becomes available and could be ready for field development next year.
The expense for circle and metro cities
The report released by Motilal Oswal Financial Services has estimated that the expenditure for A circle and metro cities can be between Rs 78,800 crore to Rs 1.3 lakh crore. Whereas only in Mumbai 5G will require an investment of 10 thousand crores.
On the other hand, TRAI has reserved a price of Rs 8400 crore for 100 megahertz mid-band spectrum. According to the report, for 9 thousand sites, the cost increased to 20 lakhs per site, then the cost would increase by Rs 1800 crore. This will increase the total cost to 10 thousand crores. Similarly, the cost of 5G rollout in Delhi has estimated at Rs 8,700 crore. While the government has reserved a base price of Rs 6900 crore for 100 megahertz mid-band spectrum.
Reliance Jio and Bharti Airtel’s position strong
According to the report, Reliance Jio and Bharti Airtel are capable of investing in 5G. Because they can increase their tariff and increase free cash flow (FCF). Whereas V (Vodafone Idea Ltd) will be difficult due to debt, low Ebitda and cash shortage.
The metro and A circle include Mumbai, Delhi, Kolkata, Maharashtra, Tamil Nadu and Chennai, Andhra Pradesh, Karnataka and Gujarat. The brokerage house has estimated the total cost to be Rs 90 thousand crore for 6 lakh sites across the country and Rs 15 lakh per site.
Total expenditure on fiber
The report states that, if the sites are required only for metro and A circle, then the total requirement of the sites should be reduced to 1 lakh. Because these circles need high density. If the requirement of fiber for the country is 25 lakh km and the cost per km for fiber layout is considered as Rs 1 lakh, then the total expenditure for fiber is estimated at Rs 25 thousand crore.