While presenting the Union Budget 2022 on 1st February, our finance minister, Nirmala Sitharaman, announced that the government will auction the telecom spectrum this year, facilitating private players to launch 5G services by March 2023 (Missed budget updates? Suggested Reading: Union Budget 2022: Summary, Key Developments, and Things You Need to Know)
“Telecommunication and 5G technology are among major growth enablers and offer job opportunities. This year, the government will conduct the needed spectrum actions to facilitate 5G mobile services launch within March 2023 by private telecom providers,” said Sitharaman during the budget speech.
In her speech, our finance minister added that the government would also launch a scheme for design-led manufacturing to create a strong 5G ecosystem as part of India’s PLI, production-linked incentive schemes.
Moreover, the budget will also allocate 5% of annual collections under the USOF, Universal Service Obligation Fund, to increase affordable broadband and mobile services in rural and remote areas of our country. It will promote research & development and commercialization of technologies and solutions, explained Sitharaman (1).
“Our vision is to enable all villages and their residents to have access to the same e-services, digital resources, and communication facilities as their urban counterparts. The government will award contracts that focus on laying optical fiber in all villages and remote parts of India under the BharatNet Project via PPP from FY 2022 to 2025. In addition, we will take several measures to enable more efficient use of optical fiber,” she added.
While reacting to the budget, Sabyasachi Majumdar, SVP and Group Head, Corporate Ratings of ICRA Limited, said (2), “overall, the budget is focused on increasing the digital penetration in India through e-learning, digital banking, and digital health programs. It would proper the use of telecom services in our country.”
Likewise, the chairman of TEPC, Telecom Equipment Promotion Council, Sandeep Aggarwal (3), welcomed the 5G auction announcement. However, he believes that our government should offer a free or low-cost spectrum to all users and operators for an initial period. And the government should go for an auction only once the market matures, in about two to three years.
“Such a move will allow the Indian government to get better prices. It will also encourage healthy competition in the telecom industry,” explained Aggarwal.
According to Peeyush Vaish, Partner and Leader in the telecom sector at Deloitte India (4), the USO funds have been historically used for rural infrastructure. A 5% allocation towards R&D and commercialization would help indigenous niche players to help build technologies around O-RAN and private networks.
“FM’s announcements around the 5G spectrum auction and laying fiber cables with PPP model will offer the needed impetus to build upon ubiquitous and reliable internet connectivity,” said Nitin Bansal, Managing Director, India and Head Networks at Ericsson (5).
“It can bridge the digital divide for the nation’s inclusive and conducive development in keeping with the “Digital India” initiative. In addition, design-led initiatives for 5G under the PLI scheme and 5% of USOF for R&D will strengthen the “Make in India” initiative and contribute to making our country a global manufacturing hub,” he added.
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5G Roll-Out Will Offer New Growth Revenues for IoT Players
We expect to see the 5G rollout will offer existing IoT players new growth revenues in multiple areas, including retail healthcare, while paving the way for new IoT projects over the next few years.
The 5G rollout can induce new growth and innovation avenues for IoT-enabled organizations. Hence, we believe that businesses need to start teaming up with telecom operators and IoT development firms. We recommend businesses to be early adopters.
We believe that companies that will start to ramp up their existing infrastructure and tap into new IoT applications are more likely to stay ahead of their counterparts in the future and gain a competitive edge.
Overall, the 5G cellular mobile communication launch is excellent news for the IoT market. After all, it will go a long way toward improving the reliability and performance of connected devices.
But, before we talk about opportunities 5G opens up in the IoT industry, it is important to understand the underlying technology behind 5G (Suggested Reading: 5G Technology: Advantages, Facts, Concerns, and Myths).
Fifth-generation mobile network, 5G, for short, is a global wireless standard after 1G, 2G, 3G, and 4G networks. It enables a network designed to connect virtually everyone and everything, including devices, machines, and objects (6, 7).
5G technology is based on OFDM, Orthogonal frequency-division Multiplexing. It is a method to modulate a digital signal across multiple different channels to decrease interference. Besides OFDM principles, 5G technology also uses a 5G NR air interface with wider bandwidth technologies like sub-6 GHz and mmWave.
In terms of mobile networking, 5G OFDM has the same principles as 4G LTE,
On the other hand, the new 5G NR air interface can help OFDM achieve greater flexibility and scalability. It could enable greater 5G access to more people and things, offering more use cases and applications.
Compared to 4G LTE, 5G offers faster and more reliable mobile broadband services and has grown into new service areas like mission-critical communications and IoT. Many new 5G NR air interface design strategies, such as a new self-contained TDD subframe design, make this possible.
Overall, 5G is a more capable and unified air interface. It has been built with increased capacity to support next-generation user experiences, new deployment patterns, and service delivery.
5G will take the mobile ecosystem to new heights with its high speeds, high dependability, and low latency. We can safely say that every industry will be affected by 5G, with safer transportation, remote healthcare, precision agriculture, automated logistics, and more becoming a reality.
Now that we understand 5G technology let’s look at how its rollout opens up new growth and development opportunities for IoT-enabled businesses.
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5G Use Cases
5G is used in three main connected services: enhanced mobile broadband, mission-critical communications, and the immense Internet of Things. Forward compatibility, the ability to flexibly support future services that are unknown today, is one of 5G’s defining features (8).
- Mobile broadband with Increased Capacity: 5G technology has the potential to usher immersive experience with AR/VR with its faster and uniform data rates that have lower latency and costs.
- Mission-Critical Communications: With its ultra-reliability, accessibility, and low-latency networks, 5G can enable new services that can revolutionize multiple sectors like remote infrastructure, automobiles, and healthcare services.
- Massive IoT: 5G technology can link a large number of embedded sensors in virtually anything by allowing to scale down data speeds, power, and mobility, offering incredibly lean and low-cost connectivity solutions.
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The Global IoT Market
IoT uses sensors and software to connect smart objects to the same network for data gathering and exchange via the internet.
It enables seamless connectivity between people and things across industrial and residential grounds.
With the use of technologies like computing, big data analytics, and other features, physical devices gather and share information with minimum to no human participation; it makes IoT possible.
And any industry that can use IoT to develop new automation applications can increase its revenue while also improving its business model.
In short, IoT, enabled with a 5G rollout, is a key component of the fourth industrial revolution. It can enable smart manufacturing, smart power grids, and smart cities, among several other things.
For instance, healthcare businesses can use communication between sensors and equipment to streamline clinical operations, manage processes, and assist in real-time patient care, even from remote locations.
Consequently, more healthcare organizations have started to focus on creating robust applications and integrating connected technologies. Remote patient monitoring, healthcare workflow management, prescription management, and medical asset tracking are just a few of the primary IoT applications in the connected healthcare space.
We all have been discussing the havoc the COVID-19 pandemic has on businesses of all sizes, including manufacturing, industrial, and government institutions, since March 2020.
Today, the lockdown restrictions have been lifted in virtually every place worldwide, which has allowed businesses across all industrial sectors to resume their operations. However, the initial nationwide lockdowns have led businesses to realize the importance of IoT.
Accordingly, their utilization has witnessed a tremendous increase in various areas, including healthcare, utilities, manufacturing, logistics, and transportation, since the pandemic.
The global IoT platform applications and services market is expected to increase at a CAGR of 11.7 percent, from 393.0 billion USD in 2018 to 783.0 billion USD in 2023 (9).
According to available data, by 2027, the number of devices supporting IoT technologies will have risen to 41 billion. Smartphones, computers, watches, cameras, and other smart devices can all be included in this number. It is also worth highlighting that major automobile manufacturers have invested more than 100 billion USD in IoT technology (10, 11).
The major growth drivers of the IoT platform applications and services market (13):
- The rapidly growing number of IoT connections leading to increased data traffic
- Increasing internet ubiquity
- Development of wireless technologies; 5G
- The rising need to increase operational efficiency in various industries
- Government initiatives in IoT R&D activities
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Gaining Competitive Edge with IoT
As we discussed, IoT allows businesses to adopt (14):
- Fully remote operations
- Human-machine interface
- Virtual collaborations
- Enablement Collaboration
- Frictionless customer experience
- Cashierless retail
Advantages of adopting IoT in your business:
IoT sensors in a production line can detect heat, humidity, vibration, oil viscosity, and other data points and alert the maintenance team in advance instead of waiting for a machine to fail. It will allow your plant maintenance staff to schedule repairs during planned downtime and help you avoid any failure in the middle of a production run.
In addition, you can also gain more data about when equipment may need a service with IoT, which would help you reduce your overall maintenance cost and downtime, leading to an improved profit margin (15).
Improved Management of Inventory and Supply Chain
IoT devices allow businesses to track their supply worldwide in real-time. These devices use RFID; Radio Frequency Identification tags on parts or shipping containers to alert manufacturers when critical components are shipped. Businesses can also use this technology to monitor inventory levels, allowing more precision and flexibility.
Overall, IoT helps businesses improve their inventory management, increasing efficiency, and visibility across multiple sites. With real-time GPS tracking, they can provide clients with more information about shipping times and potential delays. The ability to track finished goods can also help with product recall tracking (16).
By removing the human workers from the manufacturing process, businesses can have higher precision and quality control. IoT can monitor every part of the manufacturing process and control it via sensors and integrated software. Besides achieving precision and quality, it also offers monitoring of external factors like temperature and humidity and automatically alters machines to keep production going.
Since IoT sensors can gather data at a minuscule level throughout an entire facility, they can help you achieve more precision in assembly operations. It is especially useful in aerospace and defense industries with the most stringent manufacturing guidelines (17).
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IoT can change employee safety and productivity, especially with wearable IoT devices. These products gather data about your workers and their surroundings to offer feedback to help them avoid any injuries and possibly save their lives. It also helps the workforce change their behavior and educate needed skills.
IoT technology can significantly reduce work-related accidents. For instance, with the help of robotics that can handle repetitive or potentially hazardous activities. Or, as we discussed, with dynamically connected wearable devices that detect hazardous possibilities and automatically notify employees or shut down the machine.
For businesses, it can reduce injury claims costs and the inconvenience of scrambling to fill scheduling gaps while injured workers recover.
Innovation and Insights
Businesses may track customer purchase habits and adjust production volume in real-time to meet customer demands with IoT. In addition, wireless sensing devices can collect data on consumer product usage, allowing companies to capitalize on new product development potential quickly.
In the age of IoT, customer service is growing exponentially. Companies can improve existing product features based on their customers’ demands then market those enhancements for competitive advantage with the help of increased data collecting and analytics capabilities. IoT technology can help avoid an expensive and inconvenient product service recall by offering these updates wirelessly (18).