NEW DELHI: Indian consumers may have to wait anywhere between 2-4 years to fully enjoy certain 5G-use cases like augmented reality, virtual reality (AR and VR) streaming and cloud gaming due to lack of ecosystem comprising affordable devices, content and applications, experts said.
This is despite the fact that telecom operators such as Reliance Jio and Bharti Airtel have showcased some of these use cases riding on the low-latency and high throughput of fifth-generation mobile networks and have expressed their bullish outlook on 5G use cases in education, gaming, and healthcare among other segments.
Experts state that the uptake of such devices on a larger scale is likely to be pivoted on wider adoption of 5G services, expansion of smartphone brands into these segments, and local manufacturing.
“For the next 2-3 years at least, many of these devices will be for premium users and then we will gradually see other players pouring into the affordable segment. Right now, even if we have devices in the affordable segment, it will not make sense because the use cases and applications will still have a cost,” Faisal Kawoosa, chief analyst at Techarc told ETTelecom.
From the perspective of 5G, the use cases and devices will rely on low latency and high throughput. AR/VR headset, according to Prachir Singh, senior analyst at Counterpoint Research, will be a perfect example of this.
“A lot of use cases require mission-critical applications which could be in healthcare, industry, or logistics that these sectors might push when 5G comes. Devices and applications regarding these use cases in these sectors will see a boost if you see from a future perspective,” Singh commented on the enterprise side. “We [may] have to wait for the 3-5 years for adoption to pick up in India.”
Jio and Airtel are rapidly expanding their 5G services in several cities across states, and plan to cover the entire country with 5G coverage between 12-15 months.
Jio has demonstrated the benefits of 5G in the field of healthcare through a Jio Community Clinic medical kit, in education, cloud gaming, smart office, smart city, and its AR/VR device called the Jio Glass. On the other hand, Airtel, Apollo Hospitals and Amazon Web Services (AWS) trialed a 5G-driven, Artificial Intelligence (AI)-guided colonoscopy.
Furthermore, Jio has launched its cloud gaming platform – JioGamesCloud – in partnership with Paris, France-based Gamestream and Japanese firm Ubitus. By contrast, Airtel has demonstrated cloud gaming whereas Vodafone Idea has partnered with Paris-based CareGame to launch 5G mobile cloud gaming in the country despite not having launched its fifth-generation mobile network.
“Currently, we do not see cloud gaming being leveraged for the kind of gaming and experience that it can offer to the users. We are still in the early days of cloud gaming. I think it should take off in the next 2 years and become something like OTT entertainment applications in the next 3-5 years in India,” said Kawoosa.
Ashwinder Sethi, principal analyst at Analysys Mason, said that there is a possibility that telcos might bundle cloud gaming and AR/VR subscription with their 5G tariffs – a trend that has been seen globally, as these high bandwidth use cases will increase data consumption which will, in turn, help telcos with 5G monetisation.
“In a heavily prepaid market like India where ~93% of the users are prepaid subscribers, it will be important for telcos to go mass-market and target both prepaid and postpaid subscribers. Also, the early adopters of cloud gaming, AR/VR is expected to be the youth population and they are likely to fall in the prepaid category,” Sethi said.
Data analytics and consulting firm GlobalData though believes that India is still at the early stages of AR/VR adoption, with discussions mostly being theoretical.
“Developments and adoption in real life are still some years away. This, in parts, is due to the fact that 5G networks have yet to roll out across the country. Even when 5G arrives, it will be restricted to certain cities initially, so the adoption will be limited,” said Rupantar Guha, Principal Analyst in the Thematic Intelligence team at GlobalData. “My view is that enterprise adoption will pick up faster than consumer adoption,” he added.
Sethi highlighted that AR/VR is nascent in most markets globally, except in South Korea. “Thus it is difficult to predict their revenue contribution from a consumer perspective. If bundled well, these services can become a material contributor to the consumer revenues of telcos.”
AR/VR headsets in India are priced from as low as Rs 300, going all the way over Rs 1-2 lakhs.
The International Data Corporation (IDC) has recently revised its outlook for AR and VR headsets for 2022 and beyond on the back of tough economic environment and rising prices. In a report, the research firm has said that the global shipments for AR and VR headsets will decline by 12.8% in 2022, dropping to 9.7 million units. Growth is expected to return in 2023 as shipments are forecast to jump 31.5% year over year.
Startups & manufacturing
Market experts believe that startups could consider local manufacturing of AR/VR headsets and smart glasses, but they will likely trail behind larger players like smartphone brands once the latter starts diversifying into new device segments.
“None of the existing Indian brands, from smartphones or gadgets and peripherals, is very strong that they can right now foray into this kind of R&D and look at these products, said Kawoosa. “I’m expecting them to be followers in this game also. [But] This is something really some startups should consider.”
According to him, this will be a good area to explore for startups, in light of the Centre’s push on AtmaNirbhar Bharat (self-reliant India) in manufacturing. The government has in recent years rolled out the production-linked incentive (PLI) scheme for local manufacturing in various sectors, including mobile phones and telecom equipment, with financial incentives basis incremental sales achieved by homegrown and international companies.
“While India is a very big consumer market, but at times, some of the large-scale manufacturers are looking at much bigger volumes which offers them economies of scale. With PLI already in place and exports kind of factored in terms of value. I think that makes a good pathway for them. I think we are geared for all of these kinds of devices,” said Kawoosa.
“I think we have to wait for four to five years maybe,” Singh commented on local manufacturing. “The intent is already there. It’s all down to what is the value proposition for the consumer… But right now, the use cases and product pricing is not here for mass adoption.”
The experts also underlined that 5G is about collaboration and telecom operators will need to work closely with device makers, content providers and application developers to offer a value proposition to consumers.
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