The country’s private telecom operators face twin challenges on investment recovery in the New Year – customers leaving their network after tariff hikes and satellite players, mainly Elon Musk’s Starlink, eyeing a chunk of their bread and butter data business.

Private operators have invested around  Rs. 70,000 crore in telecom infrastructure and radiowave assets this year to expand the coverage of next-generation 5G services which is one of the main highlights of 2024 for the sector, a PTI report stated while evaluating the challenges before Indian telcos in 2025.

To recover investments and protect margins, private telcos resorted to tariff hikes in mid-year but that move backfired.

Around 2 crore (20 million) subscribers dropped their connections. Reliance Jio, Bharti Airtel and Vodafone Idea jointly lost 2.6 crore customers due to a 10-26 per cent price hike.

Around 68 customers switched to state-run player BSNL, which refrained from price hike. The loss-making PSU still offers generation-old 3G service and is on the path of rolling out 4G networks across the country.

Despite subscriber loss, private players need to recover investment and invest more in 5G to offer new-age services to drive future growth.

According to EY India Markets and Telecom leader Prashant Singhal, the cumulative investment of Reliance Jio, Bharti Airtel and Vodafone Idea was around  Rs. 70,200 crore in 2024.

Digital Infrastructure Providers Association Director General Manoj Kumar Singh says the telecom infrastructure sector looks at a cumulative investment of  Rs. 92,100 crore to  Rs. 1.41 lakh crore in 2022-2027 to support the 5G ecosystem.

Union Minister Jyotiraditya Scindia also backed telecom operators on the tariff hike issue citing investments made by companies in the network.

The rollout of 5G services in 2024 has paved the way for the adoption of emerging technologies like artificial intelligence which offers huge growth potential.

A new threat from satellite broadband service providers is staring at private telcos in the New Year. The satellite broadband sector has seen intense lobbying on the spectrum allocation issue in 2024.

Private telecom operators led by Mukesh Ambani-promoted Jio have been strongly protesting against the administrative allocation of spectrum to satellite broadband service providers like Elon Musk’s Starlink.

Telcos fear that allocation of radio waves to satellite broadband providers without auction will come at a low price and make a dent in their data subscriber market share.

The government’s decision to allocate satcom spectrum without auction also saw political mud-slinging with opposition members equating the move with the 2G spectrum case. As per the Comptroller and Auditor General of India , 2G spectrum allocation caused a notional loss of  Rs. 1.76 lakh crore to the national exchequer.

The minister reiterated that even administrative allocation of spectrum to satcom players will be done at a price recommended by the Telecom Regulatory Authority of India .

Indian Space Association Director General AK Bhatt has batted for expeditious allocation of satcom spectrum, saying it would help satcom players start their services in India as soon as possible and bring the unconnected areas under the coverage.

According to analysts, satcom players’ entry may delay mobile services tariff hikes by telcos and new entrants may trigger another round of price war which may push the sector into another round of financial stress as well as lower investments in the network.

Telecom industry body COAI has been pushing for revenue sharing with foreign big tech companies like Google, Amazon, Facebook, WhatsApp, etc as videos, images and other content on these platforms are estimated to consume 80 per cent bandwidth.