This means technology companies, which had planned to use the allocated 5G spectrum to develop an in-house non-public network (NPN), may have to wait longer than expected to roll it out.
“Direct assignment is very complex because we must see the legality and demand in India. Even globally, a very small and niche area is set aside for NPNs,” a senior government official said.
“Our understanding is that the total number of NPNs across the world is in the low thousands. So, that trend is likely to continue in India as well.”
Officials were of the view that enterprises that want to set up an NPN in the near term can do so by leasing spectrum from a telecom service provider. This was an option that was available to companies earlier as well.
“It is like a storm is a teacup. Too much is being made of it. Application, ecosystem or demand wise, there is very little to justify the high costs that may be associated with NPNs,” said another official, asking not to be named.
Following the completion of auctions for 5G spectrum on Monday, Minister for Electronics, IT and Communications Ashwini Vaishnaw said direct allocation of 5G airwaves to tech companies was a complex issue and needed a detailed study before implementation.
“Direct assignment (of the spectrum) is still a work in progress, because we have to have a demand study, then see the legality of it and only then take some decision,” Vaishnaw said.
Some technology companies have publicly expressed interest in the direct allocation of 5G spectrum.
ET has reported previously that L&T Technology Services was keen to obtain 5G spectrum to build use cases and deploy 5G solutions globally for parent company Larsen & Toubro.
In June, the Department of Technology had come out with guidelines for setting up captive NPNs.
According to the rules, companies that had sought direct allotment of spectrum under the captive route should have a minimum net worth of Rs 100 crore.
The Department of Telecommunications (DoT) had said that though the applicant would not have to pay entry or licence fee, it must be registered as an Indian company under the Companies Act.
The licensees, DoT said, may establish their indoor or captive and isolated NPN for their own use and cannot be used to provide commercial telecom services. The licence period for captive NPNs would be valid for 10 years, it said.
The Broadband India Forum, which represent tech companies such as Tata Consultancy Services (TCS), Cisco, Amazon, and Google among others, has said earlier that “vested interests” were trying derail this historic decision on private networks by “misleading
and misinformed claims” that companies would get a backdoor entry to provide enterprise 5G solutions without license fees for airwave allotment.
In June, TCS’ chief operating officer N Ganapathy Subramaniam told ET that private networks will enable Indian organisations to accelerate their digital agenda.
He had said that countries including Germany, Finland, the UK, United States, France, Sweden, South Korea, Malaysia, Australia, Czech Republic, Japan, Taiwan and France had already earmarked spectrum for private networks in the mid-band (3.3-3.67 GHz) and 28 GHz millimetre wave (mmWave) band.
“(Indian) government must consider allocating appropriate spectrum directly to enterprises for building private networks without any dependency on telcos and full freedom to unleash the potential for Industry 4.0 transformation,” he had said.
Tech Mahindra chief executive CP Gurnani told ET recently that technology companies should be allotted “free spectrum” to set up private 5G networks, arguing that it would increase self-reliance and boost the industry’s competitiveness in the global arena.