According to Cellular Operators Association of India (COAI), telecom operators worldwide are under pressure due to low returns on investment (ROI) and challenges in monetising 5G services, which could potentially delay the rollout of 6G technology.
COAI also emphasised the need for over-the-top (OTT) services to contribute to telecom infrastructure investments. COAI further noted that telecom companies, particularly in India, are hesitant to expand their networks due to subdued ROI, with Indian operators averaging around 4 per cent. It also warned that the situation could worsen unless OTT services begin sharing revenue with telecom companies.
As per COAI, telecom companies such as Reliance Jio, Bharti Airtel, and Vodafone Idea Limited have invested heavily in expanding their networks and 5G connectivity over the past few years but have not seen a return on investment. The GSMA officiating chairman stated that mobile network operators (MNOs) are making approximately a 3 per cent profit on their investments, which is lower than the returns they would receive from depositing their funds in banks.
Furthermore, COAI called for bringing OTT communication services under the licensing regime. The association argued that the shift of messaging traffic from licensed telecom networks to OTT platforms disrupts the economic balance and introduces security vulnerabilities. COAI noted that telcos have experienced a 94 per cent decline in revenue from SMS services over the past decade and are expected to lose over $3 billion in SMS business messaging revenue globally to OTT channels over the next five years.
