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5G launch update: Know all about network rollout status, pricing plans and tariffs

Reliance Jio, Airtel, and Vodafone Idea will start rolling out 5G services in India, this year.

Maitry Kothari

Updated : Aug 18, 2022, 02:42 PM IST | Edited by : Maitry Kothari

5G launch update: Know all about network rollout status, pricing plans and tariffs

Telecom Minister- Ashwini Vaishnaw on August 18 asked telecom service providers to gear up for 5G launch. Millions of Indians with 5G-capable smartphones are worried about whether they will have to pay extra money to obtain extremely fast speeds and improved connectivity because Indian telecom carriers aim to roll out 5G services as early as September or October on a pilot basis in some circles.

According to sources, Reliance Jio, Airtel, and Vodafone Idea are currently silent while they debate internally whether to go with a significant or minor price increase for end users. They are also talking about lucrative data bundle deals with smartphone manufacturers when the 5G roll out takes a better shape.

However, as demand rises and more people support 5G networks, particularly in metro areas where the initial demand will arise, the tariff plans will become more affordable.

“I think the 5G tariff war will be there but surely not aggressive as we saw in 2016. Operators have repeatedly mentioned possible data price adjustments to boost average revenue per user (ARPU)," Tarun Pathak, Research Director, Counterpoint Research, told IANS.

An immediate tariff war with the launch of 5G is unlikely, but it "will be competitive as India continues to be a price-conscious market," he mentioned.

5G network rollout- when and where

Airtel offered a clear rollout time and said it would start rolling out 5G services in India this year, and the network will reach rural parts by 2024 whereas Vi is yet to confirm. So far, Reliance Jio is expected to start rolling out 5G services this month.

Vi is yet to offer details on the cities it would first bring 5G services. The government had earlier mentioned that services would be launched in 13 major cities - Delhi, Gurugram, Mumbai, Pune, Chennai, Kolkata, Bengaluru, Hyderabad, Chandigarh, Lucknow, Ahmedabad, Gandhinagar, and Jamnagar. More cities and towns are expected to be covered by later this year.

The top metropolitan cities would be covered first and Pune and Gandhinagar. A peak download speed of 5.92 Gbps was observed by Vi with Ericsson during its experiments in Pune in May of this year.

Options of telecom service providers

According to a recent research by Nomura Global Markets Research, telecom service providers would have two choices: either a little extra rate increase of 4% on their whole subscriber base or a 30% premium above 1.5 GB per day 4G plans.

"Historically, Indian telecom companies have refrained from charging a premium for 4G plans (vs 2G/3G data plans). With potentially higher speed on offer and likely initial uptake from premium customers (smartphones above Rs 15,000), there is a potential for telecom companies to charge a premium for 5G (vs 4G), in our view," Nomura said in its report.

"5G tariff plans would be a key monitorable in the near term, and 5G premium (vs 4G) may provide the next leg of ARPU (average revenue per unit) uptick for the telecom companies," it added.

5G pricing plans

Prabhu Ram, Head-Industry Intelligence Group (IIG), CMR, feels that with the imminent roll-out of 5G services in the near horizon, "telecom operators will potentially seek to be aggressive in their 5G pricing plans to gain early consumer acceptance, and thereby, secure their leadership mantle in 5G".

"As 5G use cases develop further, telecom operators will seek to potentially post further market share gains in 2023 owing to any potential market churn," Ram told IANS.

After Reliance Jio offered attractive datas to users, the 4G from 2G and 3G in the country got a boost which is again expected in the 5G era with a suitable combination of bundled deals with smartphone manufacturers.

“We have been working closely with various telecom operators for over two years and have extensively tested most of our models for usability. Having a strong understanding of SA & NSA network bands, we have rolled out devices that support some of the most anticipated bands. This gives us the confidence that we will successfully be able to support, and lead the rollout of 5G solutions to millions of our users," Muralikrishnan B, President, Xiaomi India, told IANS.

“The success of 5G hinges on its premium pricing over 4G. However, reducing price disparity is key to a faster transition across categories A and B. Anticipated 4G tariff hike this fiscal and 5G premium offering in the next will elevate ARPU to Rs 185-Rs 190, though it will still be lower than the ARPU of Rs 203 seen in the fourth quarter (Q4) of FY21-22 for private players in metro circles alone," explains CRISIL Ratings in its report, which states that there isn’t a major difference between 5G and 4G tariffs.

Lastly, he added, “We expect 5G plans in India to be similar to 4G tariffs”.

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