New Delhi, October 16 2019: KPMG in India in association with India Mobile Congress and the Cellular Operators Association of India has released a report on the Telecom Media and Technology sectors titled ‘Imagine a new connected world: Intelligent, Immersive, Inventive.’ at the India Mobile Congress 2019.
The report takes a deep dive into the digital ecosystem enabled through 5G, blockchain technology, IoT , AI, cognitive computing, machine learning and AR/VR to name a few . While the current investment and focus is on creating an enriched omni-channel experience for customers, it is the use of bots and blockchain that are going to be game changers in enhancing customer experience over the next five years, as per the report. Further, on the need to address and allocate strategic importance to digital risk and data privacy, the reported highlights that 57 per cent of the companies who have commenced work on digital transformation do not have a digital risk strategy, presenting a danger to the very existence of the organisations eventually.
The report further throws light on the challenges in the implementation of the digital vision like financial stress in telecom industry, the high price of spectrum, inadequacy of a fibre network and the lack of device interoperability standards as well as suggests a way forward on how the industry could mitigate some of these challenges like the adoption of a sustainable and transparent pricing model, creation of Special Purpose Vehicles (SPV) to support international lending organisations, providing substantial investment into digital infra projects at cheaper interest rates, policy interventions in ease of doing business, and establishing funding mechanisms that provide grant funding to emerging tech start-ups.|
Says Satya Easwaran, Partner & Head – Telecom, Media and Technology sector, KPMG in India: “India has never been more alive in the telecom and technology space. We are excited to be a part of IMC 2019, at the core of all the action. There is a fundamental shift underway, with significant disruption and convergence in the roles of telecom and tech companies, as well as other sectors. This is leading to a wave of innovation and invention. It is imperative for companies to stay nimble from a strategic, business and customer experience standpoint, or else face potential losses or even bankruptcy. With the mobile data explosion over the last few years, rapid migration of customers to 4G, the advent of 5G in 2022, and all the associated technological possibilities in the next few years, we couldn’t be poised at a more pivotal juncture. There are some infrastructure and customer adoption challenges however, that we do need to address collectively as an industry. However as things stand right now, we are on the brink of an India which is intelligent, immersive, inventive.”
Adds Purushothaman KG, Partner and Sector Lead – Telecom, KPMG in India: “The future value that will be delivered through telecom operators is not by being the provider of ‘connectivity’ but as being a trusted partner and platform provider offering value and services and experiences to customers. We are living in exciting times where new technologies like 5G, IoT, AI and AR/ VR promise to revolutionise connectivity and unlock value by creating better, more secure and personalised experiences for everyone.”
Says Rajan S Mathews, Director General, COAI: “The global digital revolution at present is led by the telecom industry, which is providing services beyond the conventional offerings of access, interconnectivity and applications. A testament to India gaining a competitive edge over its global players is the fact that it has the world’s cheapest mobile data at USD 0.25 per GB, resulting in higher usage by its citizens. Also, India has made great strides in other aspects of internet inclusion such as regional penetration and gender parity parameters. However, in order to deliver value in future, telecom operators will have to go beyond being the connectivity provider and become a trusted partner and platform providing value, services and experiences to customers.”
Here is a link to download the full report - Imagine a new connected world - Intelligent. Immersive. Inventive.
Find a key graphic here
|Key technology trends of the digital ecosystem in India in 2019/2020
Policy: Policy interventions relating to 'ease of doing business', RoW clearance, public-private partnership (PPP) models for infrastructure development, creation of a national portal to monitor and track development and adoption of emerging technologies, expediting the roll-out of smart cities, finalising the Personal Data Protection (PDP) bill, drafting an IoT policy and implementation of a national programme on AI will accelerate the adoption of digital technologies in the country. Additionally, in the long term, the domestic manufacturing for telecom equipment and fibre can be given a boost through direct tax incentives for reducing manufacturing cost, formation of special economic zones, increasing export incentives
Investments: To promote investments in the sector, the government should create Special Purpose Vehicles (SPVs) to support international lending organisations and provide substantial investment into digital infra projects at cheaper interest rates
Spectrum: As the country is gearing up for 5G, it is critical that the additional spectrum should comprise a mixture of coverage (i.e., lower frequency) and capacity (i.e., higher frequency) bands to ensure that networks can provide high speed, cost effective services in rural and urban areas
Easing the financial burden of the sector: With the total levy of between 29 and 32 per cent in the form of GST, licence fee and spectrum usage charge (SUC) on the telecom sector, there is a clear need for levy rationalisation. The Universal Service Obligation Fund (USOF) contribution and SUC could be reduced to three per cent and one per cent respectively, to make the sector competitive. Further declaration of a three-year moratorium on spectrum payments to the government with abeyance on interest charge, refund of accumulated unutilised input tax of USD4.24 billion are some of the other demands of the debt-laden sector. The government could also consider doing away the levy of GST on government payments such as LF and SUC
Ecosystem: Incubation hubs and accelerators along the lines of the Atal Incubation Centres (AICs) can be established, additional funding mechanisms like the VC funding scheme and Startup India which provide grant funding to emerging tech start-ups to facilitate their operation and business could be started, as well as the adoption of a sustainable and transparent pricing model