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Adani says 5G foray is first step toward integrated digital infra
- On cards: Data centre linking with cables, industrial operations cloud, AI centre of excellence
Adani Data Networks, the digital connectivity solutions arm of the Adani Group, has acquired the right to use 400MHz of spectrum in the 26GHz band to enter the industrial 5G space.
Group chairman Gautam Adani said acquiring spectrum was the first step towards integrating the group’s digital infrastructure portfolio, including data centres, terrestrial fibre and submarine cables, industrial cloud, AI innovation labs, cybersecurity and superapps.
“The Adani Group’s foray into the industrial 5G space will allow our portfolio companies to offer a set of new add-on services that capitalize on all other digital segments we are building,” said Adani in a statement on Tuesday.
“Given that our portfolio is a highly distributed asset-intensive investment that are all being revolutionized by sensorization and fast becoming IoT enabled, we believe the next data surge will be created more by machines than by people as devices get interconnected. This data will need to be streamed, stored, processed, and analysed by other machines in real time and this capability will change every single industry,” he added.
The group’s broader strategy to digitally integrate its current and future businesses includes linking its data centres through a network of submarine and terrestrial cables, building the world’s largest industrial operations cloud, developing the super app to offer a suite of services to its 400 million consumers and establishing a world-class artificial intelligence (AI) centre of excellence.
“It will help build a set of services that the market cannot even fully conceptualize today. This volume will be exponentially higher and generated at the edges, especially in a country like India, where tier-II and -III cities are witnessing the fastest all-round growth.”
The firm’s strategy has removed the overhang of a new player entering the hyper-competitive consumer space, said experts.
The Adani Group’s auction participation was in tune with its communique, but underwhelming versus market expectations, they added.
“The Adani Group’s muted bid eliminates the sector overhang over a new entrant for now,” said Navin Killa, managing director, UBS Global Research.
“Selective spectrum purchase across seven circles clearly shows the group’s primary intent is captive usage,” said analysts at Ambit Capital.
“We believe that spectrum-related payout and Adani’s potential entry in the B2C space is now behind and focus will shift towards tariff hike quantum and timeline,” said analysts at Emkay India Equity Research in a note.
The new entrant acquired 400MHz of 26GHz spectrum for ₹212 crore for six circles. It bought 50 MHz, each, in Andhra Pradesh, Karnataka, Rajasthan and Tamil Nadu, and 100 MHz in Gujarat and Mumbai.
“The spectrum acquisition by the company appears to be in line with its stated objectives of using spectrum to create private networks and enhanced cyber security for various industry applications such as airports, ports, logistics, etc. in addition to having a low latency network across businesses as it develops a digital platform business encompassing super apps, edge data centres, and industry command and control centres,” said analysts at Kotak Institutional Equities in a note.
The group said the 5G spectrum is expected to help create a unified digital platform that will accelerate the pace and scale of digitization of the group’s core infrastructure, primarily its industry and B2C business portfolio. The acceleration of digital enablement will have long-term improvement in the rate of return on assets, the company said.
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First Published:2 Aug 2022, 11:05 PM IST
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