India remains a key market for ZTE as the company looks to expand its overseas footprint
India’s mobile telecoms sector is a key target for ZTE, as the Chinese tech firm looks to grow its international business portfolio, according to a senior company representative.
Speaking to journalists at the Mobile World Congress event in Shanghai this week, ZTE’s president for Global Sales, Xiao Ming, said that the Indian market had “huge potential” for his firm.
“India is one of our key markets. It is the second largest telecoms market in the world [after ZTE’s home market of China] and ranks number one in the world in terms of data consumption,” he said.
ZTE is already an established player in India, but the country remains one of the firms key destinations for expansion.
“We are the main vendor for VNSL and Airtel and we also work very closely with Reliance Jio, although not yet in their radio access network. We already have a good position in India and increased our market share following the merger between Vodafone and Idea Cellular [earlier this year]. That is a hugely positive sign for ZTE and we are hiring a lot of staff [in India] to support that growth,” Ming explained.
“5G is at a very early stage in India and the main challenges are around spectrum allocation and pricing. If its too expensive, it will limit the rollout of 5G. It’s already an incredibly disrupted market.
While India remains tantalisingly full of potential, it is a notoriously difficult market for operators to turns a profit. 5G may offer operators the opportunity to cash in on their networks, but only if they are able to invest smartly, according to Ming.
“Operators need to be able to offer something affordable to the population but at the same time they need to be able to make a return on their investment. Operators are struggling. India remains one of the most competitive markets in the world but new technology can help monetise 5G, which is something that operators in India really need to do.
“Massive MIMO technology allows operators to increase capacity and efficiency, using the same amount of spectrum, for their 5G services. It allows you to dramatically reduce the number of sites, by between three and five times. These types of technologies can help operators lower the cost of their network deployment and increase efficiency and capability of their networks in such a low ARPU market. Massive MIMO is a fundamental technology for 5G,” he added.
India’s telecoms sector remains ruthlessly competitive, despite the merger of two of its biggest players earlier this year [Vodafone and Idea Cellular]. However, Ming does not foresee any further consolidation in the market.
“The Indian market is already down to three operators plus one nationalised provider [VSNL] – that market should be big enough to support four operators, so we don’t foresee any further consolidation,” he explained.
Ming remains confident that Indian operators will be able to rollout a high quality 5G service, most likely in 2020. However, he believes that it is critical that the Telecoms Regulatory Authority of India (TRAI) takes the long-view when it doles out spectrum in the coming months.
“Indian telcos are beginning to stabilise their earnings and are starting to feel more confident [in investing] but its still a very, very competitive environment. We hope that the India government has a good strategy for the upcoming auctions. They need to allocate spectrum in a way that enables operators to invest properly in their 5G networks,” he said.
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