The Indian telecom landscape seems to be undergoing a tectonic shift with service providers hustling to build future-ready 5G networks. Companies such as Ericsson are helping service providers undertake this transformation. In addition to playing a key role in enabling 5G commercialisation for telcos, the company is actively involved in the digital transformation of enterprises. In an exclusive interview with tele.net, Nitin Bansal, head, Ericsson India, and head, Network Solutions, Southeast Asia, Oceania and India, Ericsson, talks about the potential for 5G adoption in India, key 5G use cases and Ericsson’s focus areas….
What are the company’s key focus areas for 2021 and future plans and strategies for the next three years?
Our strategy, based on increased investments in R&D for technology and cost leadership, has continued to bear fruit, as is evident from our results in the first quarter of 2021. We are well positioned to take advantage of the continued market momentum with a competitive 5G product portfolio and cost structure. In fact, there is a strong momentum in global 5G demand with lead markets moving forward at a high pace, creating opportunities for us to grow our core business.
As per the Ericsson Mobility Report released recently, there will be more than half a billion 5G subscriptions by the end of 2021. To that end, we continue to invest in further strengthening our portfolio and growing our global footprint. The enterprise opportunity, on the back of 5G and internet of things (IoT), offers another attractive growth area. With the investments we are making in our business in 2021, we are creating a strong platform for the long term with strengthened competitiveness in the core business as well as in enterprise applications.
Ericsson is a market leader when it comes to live 5G networks. Pioneering customers have chosen us as their 5G partner across the globe. We were the first ones to have deployed commercial live networks across five continents. As of now, we have 138 commercial 5G agreements and 85 live 5G networks globally. We have the right 5G portfolio in place to enable our customers to deploy 5G networks in all main frequency bands and utilise their valuable spectrum assets in the fastest and most efficient way. This is proven in live networks with the best performance results, so our customers have every opportunity to be ahead with 5G.
In fact, our radio system hardware has been 5G ready since 2015. This will allow operators to upgrade to 5G with a remote software installation, especially as India is on the brink of rolling out 5G. Being the first company to manufacture telecom equipment in India since 1994, we strive to be at the forefront of the digital revolution in India and will continue to provide the latest technology products and services, enabling service providers to offer a seamless experience for consumers.
What is the potential for 5G adoption in India? Which industries will be among the early adopters of the technology?
From the consumer perspective, 5G-ready smartphone users in India already spend more time on enhanced video and multiplayer mobile gaming. According to Ericsson’s consumer lab study, “Five Ways to a Better 5G”, at least 40 million smartphone users in India could take up 5G in the first year of 5G being made available to consumers. Further, they would be willing to pay 50 per cent more for 5G plans with bundled digital services, compared to just 10 per cent premium for 5G connectivity. In fact, India has seen the biggest rise in intention to upgrade with 67 per cent users expressing an intention to take up 5G once it is available, an increase of 14 percentage points over 2019. The recently launched Ericsson Mobility Report reveals that 5G will represent around 26 per cent of mobile subscriptions in India at the end of 2026, estimated at about 330 million subscriptions.
Ericsson’s “5G for Business”, a 2030 market compass study, estimates that the globally addressable industry digitalisation market for service providers could grow to about $700 billion by the end of 2030, with the projected value of 5G-enabled digitalisation revenues in India being approximately $17 billion. Thus, investment in 5G is critical to unlock the next level of growth for the country. We examined 10 industries, and healthcare now represents the largest addressable market opportunity, followed by manufacturing, energy and utilities and automotive. Going forward, we expect new uses cases to emerge across industries over time, creating more value and returns on investment for telecom operators.
What will be the key 5G use cases for telcos in particular?
Enhanced mobile broadband and fixed wireless access are expected to be the early use cases for 5G in India. These will help address the limited fixed broadband penetration levels in India and improve the data experience while on the move. Over time, we expect more enterprise-related use cases to come up, leveraging the benefits of 5G in sectors such as manufacturing, healthcare and education.
How will the onset of Covid-19 impact Indian telcos’ 5G roll-out plans? How did you manage the data deluge?
There has been considerable growth in data traffic globally and in India over the course of the Covid-19 pandemic. An Ericsson Consumer Study (2020) revealed that the average time spent on mobile broadband increased by one hour globally on an average, but in India, it went up by 2.2 hours per day. As opposed to global trends, wherein consumers are relying on fixed line networks, Indian consumers are relying more on mobile broadband. We believe Covid has really emphasised the need for connectivity, and 5G underpins the need for accelerated and seamless experiences for both consumers and enterprises.
As per the recent Ericsson Mobility Report, the total mobile data traffic in India has grown from 6.9 EB per month to 9.5 EB per month in 2020 and is projected to increase by more than four times to reach 41 EB per month in 2026. This is driven by two factors – high growth in the number of smartphone users, including growth in rural areas, and increase in average usage per smartphone.
The added load on networks has led to network replanning and end-to-end re-dimensioning activities focused on network design, capacity, performance and traffic handling to ensure that the customer experience from the network is not compromised. Leveraging artificial intelligence (AI)/machine learning (ML) tools has allowed service providers to act on network bottlenecks and eliminate incidents and failures. Service providers continue to make necessary changes to respond to the evolving situation with speed and agility, and invest in networks to boost capacity to tackle the demand.
How is the enterprise connectivity space evolving in India? What strategies is Ericsson adopting to fulfil the connectivity needs of enterprises?
Driven by cellular technology, a rapid transformation of all industries is under way and will gain momentum as more use cases are developed. Any enterprise that embraces this new level of connectivity will find that the possibilities are endless. By pushing every industry’s connectivity to its limits, Ericsson will help enterprises derive the full benefits of connectivity.
Ericsson’s private network solution is tailored to drive Industry 4.0 and the digital transformation of industrial sectors such as manufacturing, the mining and process industry, offshore and power utilities, and ports and airports. It optimises and simplifies operations with cloud-based network management, zero downtime upgrades, guaranteed high performance and installation within hours.
Going forward, how do you see Indian telecom networks transforming to become future ready?
Given the surge in mobile data traffic, networks are becoming more complex. To handle the current requirements and become future ready, telecom operators need to be prepared to manage the network complexities while ensuring efficiency from the cost, network and operations standpoints. To mitigate these complexities, operators are increasingly adopting technologies such as AI and ML to better manage their network operations.
Today, we are seeing some level of AI already being incorporated into networks. We are addressing the operational demands of AI-driven automation through network intelligence, which combines three pillars, data, analytics and insights, to tackle the increasing complexities of modern networks and prepare service providers for 5G. Besides, AI and automation will help service providers improve customer experiences as 5G-driven IoT and Industry 4.0 gather pace.