Amidst all this, state-run Bharat Sanchar Nigam Ltd (BSNL) has been hustling to launch 4G which private operators launched in 2016-2017 and have now advanced to the fifth generation or 5G technology.
The Indian telecom market is showing signs of duopoly. Jio and Airtel have already taken the first mover advantage in 5G space — Airtel has already announced launch of 5G Plus services in 8 cities, while Jio has announced beta launch of 5G in 4 cities. With the third private player Vodafone Idea struggling to survive, it’s the right opportunity for BSNL to step in and offer high quality data services to its customers to regain lost market share. The lack of clarity on Vodafone Idea’s 5G plans given the continued delay to its capital raise could lead to market share gains sustaining for Airtel and Jio. BSNL could easily fit-in in such a scenario with its 4G network which will be 5G ready once deployed.
Needless to say, with the network being developed indigenously, BSNL is also taking a huge business risk. The issue has gained prominence so much that Nokia has also expressed interest in setting up its network. The Tata Consultancy Services (TCS)-led consortium should diversify its supply chain and accelerate the process as time is running out for BSNL.
BSNL’s 4G project has been delayed already by 3 years. Even if the deal closes in the next month, a pan India rollout will be at least a year or two away.
Experts bat for more flexibility and autonomy in decision making for BSNL. Various layers of approval create unnecessary hurdles and delay the process pushing BSNL far behind private players. Due to non availability of 4G services, BSNL has already lost market share to private telecom operators over the last few years and holds a meager 10% market pie in the telecom sector.
The government recently announced a Rs 1.64 lakh crore package for BSNL but the road to recovery is fraught with hurdles and delays. The latest concern with BSNL’s 4G network has been over pricing so much that the department of telecommunications has asked a telecom player and other vendors for their price to arrive at a benchmark price. BSNL and Tata Consultancy Services (TCS) have been locked in a price war over supply of network gear for setting up a 4G network for BSNL. TCS-backed consortium quoted Rs 21,428 crore as against the BSNL’s internal estimation of Rs 16,136 crore for capex including 5G core expansion. According to the latest information, BSNL will soon close the deal at a negotiated price.
BSNL’s network is expected to become a mascot for ‘Atmanirbhar Bharat’ but it needs to ensure there are no more delays to make it a best proposition for PSU and even for the government.