COAI: The health-related issues of the telecommunications industry are even more relevant now; essential viability: COAI
The government must therefore view “primary telecommunications revenues” from the perspective of “secondary revenues” that would flow from other industries that harness the benefits of next-generation technology, he said.
“The financial health of the telecommunications industry is not good, everyone knows that. Little has been done to help improve the fiscal health and the industry has its back to the wall trying to cope. And now if they have to shell out huge sums of money for 5G auctions, then it will be very difficult for the industry to find the money for it, ”said SP Kochhar, CEO of the Association. Cellular Operators of India (COAI).
Industry demand for the removal of old levies, taxes, rationalization of the USOF (Universal Service Obligation Fund Levy) and other measures for long-term sustainability, are now more critical than ever, Kochhar said.
“If anything, they have become more relevant … Telecommunications operators are very clear, they want to deploy networks and services for the benefit of citizens … Obviously, the cost of inputs must go down, c ‘makes a lot of sense, ”Kochhar said. mentionned.
The government is aware of the situation and the demands of the industry, he noted.
According to IBOC, the advent of 5G will open up huge possibilities and fuel the growth of other industries as well. Therefore, the consideration and criteria for 5G auctions cannot be the same as adopted for 4G.
“What we had so far were clear business use cases, where there was only one subscriber talking to one subscriber. With 5G, the prospects are vast but it will take time. to build … With the arrival of 5G, all sectors, without exception, will be empowered and their sources of income will increase considerably thanks to 5G … this will improve their production capacities, their efficiency … The government’s revenue from these industries, which rely on 5G, will be manifold, ”Kochhar said.
Thus, if primary incomes are reduced and a robust next-generation network is deployed, secondary incomes from recipient industries would be much greater. This approach would repeatedly compensate for any shortfall due to primary revenue, he argued.
In addition, the industry must be on a par with the new Over-The-Top (OTT) players who offer similar services but are not subject to the same rules. As such, the telecommunications industry remains “heavily taxed” with almost 38% of revenues spent on taxes.
Telecommunications services had gone from being seen as status symbols at one point to a lifeline for the economy and society, amid the pandemic.
“It must be recognized that telecommunications are indeed an essential service and must be treated as one. If telecommunications is an essential service, it must be maintained and to maintain it, provisioning must be made at a sustainable cost. If you need ubiquitous telecommunications service across the country, input costs need to come down and it needs to be made a viable sector, in which telecommunications operators can invest and provide the required quality networks ”, a- he declared.
It is relevant to mention that the Department of Telecommunications (DoT) has started the ball rolling for 5G testing. The DoT recently allocated spectrum to operators to launch 5G trials in the country. The trials will be conducted at various locations including Delhi, Mumbai, Kolkata, Bengaluru, Gujarat, Hyderabad, among others, according to industry sources.
Telecommunications operators have been allocated spectrum in the 700 MHz, 3.3 to 3.6 gigahertz (Ghz) and 24.25 to 28.5 Ghz bands at various locations.
The allocation of the trial spectrum came after the DoT on May 4 approved requests from Reliance Jio, Bharti Airtel, Vodafone Idea and MTNL to conduct 5G trials without using technologies from Chinese companies.