Telco bosses seek faster 5G rollout, bank support and end of litigation

Reliance Industries chairman Mukesh Ambani on Wednesday pitched for the use of universal service obligation (USO) fund to increase smartphone adoption.

“India needs to ensure affordability not only of services but also of devices and applications. The best way of ensuring comprehensive affordability is nimble adoption of futuristic technologies and supportive policy tools like the use of USO fund for purposes other than services. USO fund can be used to subsidise devices to select target groups,” Ambani said in his address at the Indian Mobile Congress.

The USO fund is currently being used for increasing connectivity in rural areas and is pooled from licence fee payments by telecom companies.

The Indian Space Association (ISA), which has Airtel, Nelco and Larsen & Toubro (L&T) as its members, has demanded a subsidy for satellite operators through the USO fund.

Ambani’s remark is crucial in the context of Jio’s roll out of low-priced smartphone JioPhone Next in collaboration with Google. The smartphone has been key to the company’s strategy to win over 2G customers, but contrary to initial expectation, Jio is not subsidising its phone price.

While Ambani proposed five ideas, including faster roll out of 5G and fibre, promoters of Bharti Airtel and Vodafone Idea (Vi) called for support from banks, greater industry collaboration and an end to vexatious litigation.

The remarks came at the inaugural session of the Indian Mobile Congress, which is being held in the backdrop of the telecom sector reforms, amid industry preparations for 5G service next year.

­­­Aditya Birla group chairman Kumar Mangalam Birla, whose company Vodafone Idea has been the biggest beneficiary of the reforms, urged support for lenders and further steps for ease of doing business.

“A robust industry is necessary to invest and accelerate the achievement of the Digital India vision. Over the last few months, the government has made some critical policy interventions in this direction. Further steps in ease of doing business and support from the banking sector would significantly enhance the sector’s strength and ensure that India remains at the cutting edge of global technology trends,” Birla said, while committing Vi’s participation in creating a five-trillion dollar digital economy.

Birla’s remarks come as Vi continues discussions to raise fresh funds from investors. The telecom operator expects to complete fundraising in the current financial year.

Bharti Airtel chairman Sunil Mittal said the telecom reforms, including simplification processes and return of bank guarantees hold a great degree of promise for the industry.

“The deferment of adjusted gross revenue (AGR) dues by four years and giving a moratorium, have again been a great relief for at least one of the operators, who needed this in a desperate way. All in all, I would say the government has moved in a remarkable fashion,” Mittal said.

Mittal also suggested collaboration among industry players, including sharing of resources and towers and urged the government to relook at all the litigation.

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