5G adoption to take time, only a third of users may switch by March 2025

High cost of 5G devices and readily available 4G network shaping users' behaviour

Only one in three telecom users in India are likely to switch to 5G by March 2025, ratings agency CRISIL has said at a time when carriers are racing to expand their network for the spectrum.

The Economic Times (ET) said that CRISIL cited reasons such as the high cost of 5G devices and the already available 4G network that fits the bill for most users. The ratings agency also said that many users may not find the near-term value proposition in switching to 5G.

According to estimates released by CRISIL, India's 5G user base will grow to 300 million in the next two years. The base now stands at 20–25 million. Current 5G users are enjoying technology-neutral tariffs being offered by Bharti Airtel and Reliance Jio, ET said.

Naveen Vaidyanathan, director, CRISIL Ratings, was quoted in the report as saying, "While the share of 5G smartphone shipments will improve gradually, the low initial value proposition and high cost of the gadget versus a 4G phone would restrict overall 5G adoption to 300 million users by fiscal 2025."

CRISIL said 5G adoption in India will not be at the pace seen for 4G. Adoption of 4G had been swift by comparison—it took only two years for 60 per cent of users to migrate to a 4G network. The entry of Reliance Jio, which was followed by tariff wars, further accentuated the adoption of 4G in India.

Vaidyanathan added that even though only 30-35 per cent of the 150-170 million devices shipped in India have 5G capabilities, the share of 5G smartphone shipments will improve gradually.

CRISIL analysis said that large-scale adoption of 5G will only be possible if real-world use cases are unlocked. It added that access to smart classrooms, precision farming, and intelligent transport systems, etc. would need a substantial upgrade in the network infrastructure, and this could take some time.