India has often lagged behind other markets in delivering public WiFi, for a variety of reasons ranging from regulatory barriers in the early days of hotspots, to a tough competitive climate for ISPs. It is estimated to have only about 30,000 hotspots available at this time, but that number is set to explode as the major operators become interested in supplementing their broadband or mobile networks with WiFi. This is especially true for MNOs, as most mobile carriers are facing severe budgetary challenges after spending heavily on 3G and 4G spectrum.
Indian MNOs already have to cope with the lowest ARPUs in the world, and a series of regulatory decisions which they feel have limited their ability to improve revenues and profits by harnessing 3G and LTE data services. High reserve prices for spectrum, limits on the ability to roam (no carrier has nationwide 3G spectrum and only newcomer Reliance Jio has a national 4G licence), and the need to re-bid for expiring spectrum franchises – all these have put intense pressure on the mobile business case in India, at a time when carriers need to invest heavily in mobile broadband build-outs to have any hope of ROI on those spectrum bills.
The situation is so bad that the operators are lobbying for a delay of at least two years before the government auctions its next batch of spectrum, in 700 MHz. Even though this is a coveted band for rolling out wide LTE coverage cost effectively, carriers say they need time to formulate robust business plans, and for the ecosystem to mature so that their costs come down. But the primary reason is that they need to find funds to purchase new licences – according to the Economic Times, Indian telcos have a collective debt burden of INR3 trillion ($43bn) partly because of high 3G spectrum prices.
Against this backdrop, supporting data services in unlicensed spectrum, especially if the hotspots can be managed from the operator’s OSS/BSS, is clearly attractive. This is particularly true for MNOs which are lagging behind in the race to have national data-enabled networks, so it is no surprise that some of the leading lights are state-owned BSNL, whose 3G and 4G plans have virtually stalled amid poor financial performance and uncertainty over its future structure; and Reliance Jio, which will enter the telecoms market this fall with a TD-LTE network, but will rely on roaming deals and WiFi to achieve wide coverage and cost efficiencies.
BSNL plans to spend INR60bn ($940m) on deploying WiFi hotspots over the next 2-3 years, according to LightReading. It has built 250 so far and aims to increase the number to 2,500 by the end of its current fiscal year, and 40,000 by the end of 2018. The hotspots will be integrated with its 3G network and planned 4G systems (if those get built), to support seamless access, and with its OSS/BSS.
BSNL is partnering with firms on a regional basis to deploy WiFi networks under a revenue sharing model. Quadgen Wireless is its partner in the south and west of India, and Trimax IT Infrastructure and Services in the north. BSNL will hold a tender for the eastern and north eastern region. It provides the backhaul while the third party instals and maintains the hotspots for a five-year period.
Meanwhile, Jio will use its TD-LTE network to backhaul some of its own hotspots and to support seamless access services. It plans to provide WiFi for free, to help attract users to its brand new service, and to encourage offload, in order to save the LTE network from strain and to reduce its capex bills. It will initially launch the offering in Kolkata, followed by other cities, say local reports, which also indicate it has a deal to buy 30,000 WiFi access points from Ericsson (presumably courtesy of that vendor’s BelAir acquisition) to instal in Delhi and Mumbai.
Other operators investing in public WiFi include market leader Bharti Airtel; Vodafone, which is running a pilot in dense urban centers; Tata, which is promising to launch 4,000 hotspots over the next year; and Idea Cellular, which has a soft launch in five cities.
Amid scarce spectrum, and a low number of WiFi hotspots and ISPs, telcos will have to build out a large percentage of these public WLANs themselves, though as hotspots proliferate, no doubt there will be roaming and sharing deals to ease the deployment load and the strain on resources like sites and backhaul. But many of them will see this as a lesser evil, in terms of capex, than attempting to satisfy rising data demand, and government broadband mandates, with 3G and 4G alone, especially since many have only 5 MHz of mobile broadband spectrum and no national 3G coverage.
Public WiFi is also an element of the recently launched Digital India program, which includes a commitment to offer free WiFi in the country’s top 25 cities during this summer.