Capitalising on 5G: Policy, spectrum and infrastructure developments

The year 2025 was a year of strong and broad-based growth for India’s telecom sector. Revenues grew by approximately 14 per cent to over $33 billion, driven by the mid-2024 tariff hikes, the accelerating ramp-up of 5G services and data penetration crossing 80 per cent. This growth trajectory is not incidental. It reflects a structural shift in how telecom operators are positioning themselves, moving well beyond their traditional role as network providers and into integrated technology companies.

The enterprise segment is a significant part of this repositioning. Operators are scaling their enterprise offerings through partnerships with hyperscalers, software-as-a-service providers and cybersecurity players, rather than attempting to build everything in-house. Both Reliance Jio and Bharti Airtel have made large-scale commitments to data centre capacity, partnering with global technology companies such as Google and Nvidia. Data centre capacity is expected to grow from approximately 2 GW today to 8 GW by 2030, with operators channelling 20-30 per cent of their capital expenditure into artificial intelligence (AI)-ready data centres, edge infrastructure and cloud.

5G ramp-up

India’s 5G roll-out has been among the fastest globally. As of March 2026, over 520,000 base stations are active and 5G now covers 85 per cent of the population and 99.9 per cent of districts. There are currently 465 million 5G subscribers, representing 35 per cent of the total wireless base and the second-largest 5G subscriber base in the world. Over 385 million 5G-enabled smartphones are in circulation and falling device prices have been a key enabler of this ramp-up.

The investment behind this roll-out has been substantial. Across the three operators, approximately $19 billion has been committed to 5G spectrum. Jio has spent around $11 billion and is actively scaling its 5G standalone network, and Airtel has invested approximately $5.5 billion and is rolling out standalone 5G in phases. Similarly, Vodafone Idea Limited invested around $2.5 billion for the 3.3 GHz band across its 17 established markets and has commenced roll-out. The ambition is clear: India is targeting 1 billion 5G subscribers by 2031 and 90 per cent population coverage by 2030.

One of the defining structural capabilities of standalone 5G is network slicing. The same tower, fibre and spectrum can be partitioned into multiple slices, each sold as a distinct service at a distinct price point. This capability is available only in standalone mode and is central to how operators will eventually differentiate and monetise their 5G assets.

FWA leads the way

India’s home broadband market has entered a land-grab phase. Against a total addressable market of over 300 million households, the current subscriber base stands at approximately 63 million in 2025-26, with a projected threefold increase to over 300 million by 2029-30. FWA is a primary growth engine, with FWA homes consuming 500-600 GB per month – roughly double the usage of fibre homes. The ARPU for home broadband is approximately twice that of mobile, making this an important monetisation opportunity. Both Jio and Airtel are accelerating their FWA and fibre-to-the-home offerings, bundling internet protocol television and over-the-top content to drive adoption and deepen the home digital experience.

Global monetisation models

Globally, operators have moved away from treating 5G as a single product. They are carving networks into tiered service offerings, with network slicing at the core. In Korea, operators have built premium packages around cloud gaming, extended reality concert streaming, multi-camera sports viewing and augmented reality navigation, shifting the value proposition from selling megabits to selling seamless application experiences. In the UK and Western Europe, operators have introduced on-demand booster packages, allowing users on standard plans to purchase a temporary speed lift for specific occasions such as travel, large downloads or live events. Network application programming interfaces represent another emerging category, enabling developers to access network capabilities such as quality on demand, location and device verification on a pay-per-call basis.

Outlook

The market expectations of telcos have shifted considerably. Investors are increasingly pricing in a future where operators monetise digital infrastructure and participate directly in AI-driven growth. This is reflected in valuations. Jio and Airtel rank among the two most valued companies in India. However, this valuation premium is conditional on delivery. Operators are expected to demonstrate a credible transition away from legacy-heavy operating models towards faster, more agile execution. Further, energy cost volatility continues to drive operating expenditure uncertainty, legacy network and IT debt remains significant, and global supply chain fragmentation is complicating vendor strategies and technology choices.

Navigating these pressures while maintaining capital discipline and continuing to experiment with new operating models will determine which operators successfully convert their 5G investment into durable, long-term returns.