COAI: Direct Spectrum Allocation to Enterprises Not Feasible in India

The Cellular Operators Association of India (COAI) has stated that direct spectrum allocation to enterprises for private 5G networks is not tenable in India. The association cited concerns over cost burden, regulatory parity, and security. COAI believes that all enterprise 5G needs should be fulfilled through licensed Telecom Service Providers (TSPs) to ensure national security, revenue protection, and regulatory balance.

The Cellular Operators Association of India (COAI) has reiterated its stance against direct spectrum allocation to enterprises for private 5G networks. The association, representing major telecom operators like Reliance Jio, Bharti Airtel, and Vodafone Idea, cited concerns over cost, regulatory parity, and security as primary reasons for its opposition.

COAI believes that all enterprise 5G needs should be fulfilled through licensed Telecom Service Providers (TSPs) via spectrum leasing or network slicing. This approach, the association argues, ensures national security, revenue protection, and regulatory balance in a rapidly evolving ecosystem.

The association's position is supported by several key points. Firstly, direct spectrum allocation to enterprises could lead to significant capital expenditure (capex) and operational burdens, given that most enterprises lack the expertise or scale to manage telecom infrastructure efficiently [2]. Secondly, the association is concerned about the potential national security implications of private networks managed by unlicensed or foreign entities. These networks could expose India to cybersecurity, surveillance, and diplomatic risks without robust domestic oversight [2].

Moreover, COAI argues that direct spectrum allocation could result in a significant loss to the government exchequer, as the national auction of spectrum generated ₹1.5 lakh crore in 2022 alone. Additionally, it would create an uneven playing field between TSPs and private entities who enjoy infrastructure benefits without comparable regulatory or financial obligations [2].

The association's stance comes in the wake of the Department of Telecommunications (DoT) ordering a fresh study to assess the demand potential for setting up private networks through spectrum given directly by the telecom department to enterprises. The initial study concluded that the device ecosystem was not yet ready to support the use case [2].

In contrast, the Broadband India Forum (BIF) had earlier drawn parallels with countries like the US, Finland, Germany, and the UK, where private networks have been deployed by telcos. However, COAI struck down this argument, noting that most industrial corridors and enterprise zones in India are already well-served by telecom operators, leaving no coverage deficit [2].

The ongoing debate highlights the complex interplay between regulatory frameworks, national security, and market dynamics in the Indian telecom ecosystem. As the private 5G market continues to evolve, it remains to be seen how these factors will shape the future of spectrum allocation and private network deployment in India.

References:
[1] https://www.ainvest.com/news/strategic-synergy-onelayer-check-point-securing-private-5g-4g-networks-lucrative-opportunity-cybersecurity-boom-2508/
[2] https://telecom.economictimes.indiatimes.com/news/industry/telecom-companies-oppose-direct-spectrum-allocation-for-5g-in-india/123232781