Ericsson’s Ekholm says cheap spectrum key to faster 5G rollouts in India

Börje Ekholm ericsson
Image by Wolterk | Bigstockphoto

Ericsson Group chief executive officer and president Börje Ekholm said that India’s telecom regulator must find a way to make 5G spectrum affordable to enable faster rollout of high-speed broadband services.

The top executive of the Swedish telecom gear maker said that “reasonably priced” 5G spectrum can unlock value to the general economy.

“One of the key things for India is that the spectrum is available at a reasonable price…it’s worthwhile for all countries to actually think about the value the network can provide, from the general economy point of view versus the upfront spectrum prices,” Ekholm told the Economic Times in an interview. “So, I think there is a clear trade-off and sometimes I think, the fast rollout of a network is undervalued.”

Commenting on Ericsson’s quarterly performance in the region, including India, Ekholm said that the country’s industry is currently migrating from a “4G investment environment to a 5G investment environment”, thereby the growth for Ericsson is a “bit slower”.

“But we also are very positive that you will see spectrum allocated in 5G auctions that will ultimately lead to networks being built over time as well,” he added.

The CEO also said that terrestrial and satellite telecom services will coexist in India, but satellite will only serve specific use cases whereas telecom will cover the larger population.

“The terminal prices and the scale you have in terrestrial communication is so much bigger that terminal prices come down very fast, and that’s a bit more challenging in satellite,” he said during the interview. “That’s why I think there are going to be different applications demanding different technologies.”

For background, Indian telecom operators – especially Reliance Jio and Vodafone Idea – are at loggerheads with satellite companies over the allotment of spectrum in the 28-GHz band. Telcos have said that no spectrum should be allocated to non-telecom companies through the administrative route, and advocated auctions for all kinds of spectrum to ensure a “level playing field”.

Ekholm also supported comments by Reliance Jio, Bharti Airtel and Vodafone Idea last week that the Telecom Regulatory Authority of India (TRAI) should not set aside any 5G spectrum for private enterprise networks either for free or at an administrative price.

Companies like Tata Communications, Tech Mahindra, ITC and engineering major Larsen & Toubro recently demanded dedicated spectrum for private networks. Indian telcos argue that such a proposal would be “legally untenable” and could cause huge revenue losses to the national exchequer.

Ekholm added his own two cents, saying that allocating spectrum directly to enterprises or IT companies would lead to further spectrum fragmentation, impacting its efficiency.

“The macro operator can actually give a network slice to an enterprise that actually gives them almost a dedicated network. And as part of the macro network, that’s probably economically a much more rational design than every enterprise starting to build their own,” Ekholm said.

Meanwhile, Ekholm said that the gear vendor is continuing to increase its investment in India, both in manufacturing and R&D.

“We have a manufacturing facility in India together with Jabil that today is used predominantly actually for 5G export from India. But our ambition is to leverage this, of course, for the local market as well,” he said. “We want to be considered as a local player in India. That’s really our ambition.”

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