The telecom infrastructure industry is playing a crucial role in helping sustain businesses, provide information and connect people during the lockdown in the wake of Covid-19. The towercos are managing the tough task of ensuring network uptime even as network maintenance and site visits become a big challenge due to lockdown restrictions. The ensuing crisis is likely to bring to the fore new business models, while pushing for higher fiberisation both in backhaul and on the access side. The launch of 5G technology in India will also require massive fiberisation. It will result in the industry deploying more micro sites for ubiquitous and robust service coverage. In a recently organised webinar by tele.net, Sairam Prasad, president, field operations, Reliance Jio, spoke about the role that the telecom infrastructure industry is playing amidst the Covid-19 crisis and lockdown, the measures being taken to address the surging data demand, the emerging infrastructure trends and business models, and the outlook for 5G in India. Edited excerpts…
In this time of crisis, the efforts of the telecom fraternity, particularly the infrastructure sector, are highly appreciated. It is commendable how the field teams have shown tremendous commitment and spirit when it comes to visiting sites to maintain them for seamless service delivery and best uptime.
At the industry level, we are witnessing significant data traffic emerging from Tier 2 cities and rural areas as well. This is primarily due to the massive movement of people, typically migrant labourers, returning to their villages from cities. It is challenging now for telcos to suddenly ramp up their capacities to ensure that no service degradation takes place due to an unprecedented traffic surge. In this context, network planning becomes very important. It has two parts – one, soft optimisation of the network by changing parameters; and second, an addition of the physical capacity at sites where traffic is increasing.
In a lockdown scenario, adding capacity physically is a challenge and hence, soft optimisation becomes the key. The idea is to properly distribute the existing capacity as much as possible and allocate additional bandwidth for sites that require more traffic. Backhaul capacity augmentation is equally important, as it can help relieve immediate congestion.
In the long run, some new business models are likely to emerge, as there will be less physical field activity and more softwarisation. So, one of the biggest disruptions that Covid-19 has brought about is to warm up companies to the idea of automation and allow many of the tasks to be done by machine than by people. For instance, drones can be used for patrolling site activities.
Automation to optimise costs
Automation will become indispensable for infrastructure players in the coming years, especially with the rising costs of manpower, transportation and power. The number of tenants per tower has come down, owing to telco consolidation in the recent past. The only way to maintain profitability is through cutting back on costs, which is extremely challenging. Thus, it becomes important to resort to softwarisation for minimum intervention at sites, which can bring down costs dramatically. Automation is definitely one of the biggest drivers of optimising costs in the new scenario.
Focus on fibre
Focusing on fibre is one of the big shifts for infrastructure players. Currently, telcos continue to deploy fibre on their own and this can be a big opportunity for towercos in the future. On an average, 30-35 per cent of telecom sites in the country are connected on fibre. But in the 5G scenario, two big changes will occur. First, if not 100 per cent, at least 80 per cent sites have to be connected with fibre. Second is the number of sites, less than a million at present, and this needs to grow by three to four times, especially for in-building solutions and small cells.
Maturing 4G ecosystem
In India, 4G is fairly mature now. 4G’s penetration has grown significantly in terms of customers, coverage and capacity in the last three years. All our customers use 4G services but there are other telcos that continue to have a mix of 4G and non-4G customers in their network. Therefore, there is room for growth, at least for the next two to three years. Since 4G networks of all telcos are mature, any incremental addition of data demand can be met with marginal cost.
Moving towards micro sites
With 4G deployments reaching a mature stage in the country, the next few years will see a rise in micro-site deployment. Indoor and outdoor small cells and other in-building solutions will start proliferating in a big way. In fact, this smart infrastructure will be a key enabler for 5G. This, however, will not make macro sites redundant. India would need macro sites for 4G, which will co-exist with 5G for many more years. Macros sites will continue to provide umbrella coverage.
Outlook for 5G
The 5G scenario is very different from that of 4G. The spectrum frequency is much higher than 4G, and thus requires a greater number of sites. Besides, the throughput that 5G needs to deliver is hundred times more than 4G. So, obviously, 5G needs a more robust backhaul and fibre is best suited to deliver such throughputs. There is an urgent need for deep fiberisation to make 5G a success. 5G would need a lamp post kind of coverage wherein the sites will have less than 100 metre radius.
The current infrastructure in the country primarily comprises macro towers, which, as already mentioned, are important for umbrella coverage. But beyond that, it has to evolve into smart infrastructure, which comprises small cells and fibre edges. These two are big-ticket items, which the infrastructure industry has to focus on and try to roll out as fast as it can.
For 5G to be successful, as already mentioned, a site would be required at every corner of the road, at every building. This, of course, will result in an addition of new stakeholders within the ecosystem. For instance, telcos and towercos would have to collaborate with building owners, and work with authorities to build a 5G network. Giving right of way for utilising the government infrastructure such as roads and utility poles will go a long way in enhancing the country’s infrastructure readiness for 5G deployment.
Of course, first, the technology trials have to be successful. I assume that the industry will see some trials during 2020. And once these trials are done successfully, auctioning of spectrum will follow and finally, deployment will take place. That said, given the uncertainty owing to Covid-19 in the world, it is difficult to predict anything with surety at this point in time.
Although the majority of the municipalities have a system in place to give approvals for setting up towers and fibre, they are not very keen on telecom infrastructure players tampering with the city architecture and have several restrictions. For fibre, players would like to go for underground deployments, but getting permissions is a big challenge as it requires digging of roads.
Outlook for the industry
My outlook for this industry remains positive. But for achieving long-term sustainability and success, it will be of utmost importance that the industry starts focusing on diversification of the current portfolio of normal macro towers and exploring more innovative future-proof smart infrastructure. The country has already achieved a robust network of macro towers that have been up and running for over a decade now. The need of the hour is to embrace diversification in terms of rolling out fibre networks, deployment of small cell infrastructure and other in-building solutions. There are other opportunities too, such as rolling out digital infrastructure under the Smart Cities Mission. Although announced more than five years back, the programme is yet to take off in a big way, and offers ample opportunities to infrastructure providers. Towercos can also look at taking up the role of managed service providers.
Going forward, the innovation of business models and diversification of traditional revenue streams will be two key pillars for the telecom infrastructure industry to thrive amidst the current crisis as well as to ensure long-term growth and profitability.