Breathing WiFi

In a digital era where even kids are aware of a WiFi service inside homes, a shift towards open WiFi or free WiFi at public places in the Indian cities and villages alike is inevitable in the next couple of years.

India got its data wings with the launch of services by Reliance Jio in September 2016. Since then, data volumes on a mobile network have multiplied manifold, forcing the telecom players and even the government to look for ways to satiating the data demand with other means apart from the smartphone.

Public Wifi hotspots and broadband through fibre is the way forward as mobile networks face congestion issues with rapidly growing data traffic.

Globally, WiFi access is free in mostly all public places, but such a scenario is still at least 3-4 years away in India.

WiFi, especially public WiFi, will be a game changer in the future. WiFi hotspots will also be critical to the telecom industry as well as government's plan of extending the internet to rural areas. This will serve a dual purpose – enable telecom players to offload traffic data from their networks and bring rural people on the Net. With over 1 billion mobile users, only around 500 million are connected through mobile broadband internet.

To connect rural areas with internet, BharatNet -- a government project to connect 2.5 lakh gram panchayats – is already underway. Riding on the back of BharatNet fibre, the government plans to set up 1.25 million hotspots across all key institutions. Apart from this, private players plan to set up 1 million hotspots across the country. The target is to reach 10 million WiFi hotspots by 2022.

However, much would depend on various policies and regulations that the government will bring in to encourage companies to set up their base for offering WiFi services at such locations. State-run telecom player BSNL and Common Service Centers, under the IT ministry, also have plans of setting up WiFi hotspots.

Mahesh Uppal, a telecom expert, said small players could have played a major role in proliferation of public WiFi.

"We could have incentivised them but India's licensing rules have little flexibility to allow these incentives. While WiFi is important, a commercial player may find deployment at larger scale not sufficiently lucrative. Free services are not an option for a profit driven small player. Yes, one can offload network traffic to hotspots which can reduce congestion in some way," he said.

Also, WiFi would be a more affordable means of offering communication services.

Faisal Kawoosa, founder, techARC, consulting firm, said, "Cellular communication has limitations and barriers to effectively offer indoor coverage. At the same time user data habits are changing. We want to continuously use data heavy apps, even in public places. This is where public WiFi has a role. Moreover, a lot of business opportunities can be built over an effective public WiFi."

Going forward cellular data services won't sustain at the current price levels, and compared to mobile, WiFi can offer an affordable alternative, he said.

The growth in the wired broadband segment has been minimal and the total user base is negligible compared to mobile broadband. This is why WiFi as a wireless means of accessing internet becomes important.

The new national digital communications policy unveiled by the Department of Telecommunications has plans of setting up five million public WiFi hotspots by 2020 and 10 million by 2022 through National Broadband Mission. A Fibre First Initiative will also be implemented to take fibre to the home.

Currently, official estimates suggest that there are around 38,000 WiFi hotspots across India. Though, experts say the number could be higher at around 60,000.

Infrastructure woes

Though, data volumes have increased substantially, the margins and profits of incumbent telecom players has taken a hit due to dirt cheap tariffs ushered in by Reliance Jio and followed by all.

With declining financial health, the telecom players are not even able to invest in new infrastructure or upgradation of existing one which is why the mobile network faces congestion issues and quality of service problems.

Telecom secretary Aruna Sundararajan said, "We need a lot of infrastructure upgradation, before we can give the desired access, speed and quality of services. The Department of Telecommunications is constantly in dialogue with the telecom service providers to get them to improve their networks.There are issues in quality, data connectivity."

But the good thing is that with the proliferation of WiFi hotspots, the quality of services will definitely see an improvement because right now there is huge congestion in networks, she said.

Ashish Sharma, partner, strategy and telecoms lead at PwC, said the scale and speed of transition in India from voice dominated to becoming the largest consumer of mobile data has been not just speed, but brutal as well, even as consumers have enjoyed unprecedented benefits in terms of coverage and rates.

"As the current situation persists, industry players need to address the twin challenges of improving their viability even while improving the user experience on both voice and data. For data, this would require investing in increasing both the capacity and throughput of the network (the amount of data one can download and the speed at which it does)."

"The increase in data has choked out the backhaul capacity for voice as well, which has resulted in the significant loss in quality around even basic voice calls. A single technology network (only 4G) has a lower cost of delivery compared to a network which has multiple technologies (2G/ 3G/4G)," Sharma said.

The competitive intensity in the Indian telecom industry is expected to continue for the next few quarters and an increase in tariffs is the only solution, said Rajan Mathews, director general, Cellular Operators Association of India (COAI). The tariffs are already at the lowest level and the industry is going through its toughest phase, he said.

Uppal said the main cause of poor network quality and capacity is lack of investment. But unless telecom players have a commercial justification to invest, things will not change much.

The future

Fibre leasing represents a $2.6 billion market by fiscal 2020. Fiberised towers will increase from 90,000 to 3,30,000 by fiscal 2020, according to data from Tower and Infrastructure Providers Association (Taipa). In India only around 25% of towers are fiberised, while globally it is around 70-80%. Once the global standards are achieved, the 4G rollout across India will be completed in an efficient manner, and then the country can easily shift to 5G, which is expected to be commercially launched in India by 2020.

The silver lining for telecom industry continues to be rising data consumption. A recent report by Ericsson said smartphone subscriptions in India are likely to grow from 560 million in 2018 to 1 billion in 2024, and data traffic per smartphone per month is expected to grow at a compounded annual growth rate of 14%, from 6.8 GB in 2018 to 15 GB in 2024.

A recent research on handset consumers by Nielsen showed the appetite for data consumption has risen over the last few years. Earlier, mobile users were consuming 4 GB data a month, while today the consumption is as high as 1 GB per day.

The exploding data boom will need WiFi and fibre broadband services in a big way. Telecom tower players are even planning to lease out fibre from BharatNet, enabling them to enhance their capacity with the rising consumption of data services, besides saving costs. The industry needs another 1,00,000 towers in the near future with the rising growth in mobile data services.

Uppal said 4G data, along with WiFi where possible, will be the way forward for telecom players as well.

A mobile app where users will be able to seamlessly roam on public WiFi hotspots across the country is also in the making. In simple terms, once a user logs in to a public WiFi network and moves on to a different location/city, the user will automatically be connected to WiFi network available without any need for re-verification.

State-run telecom player BSNL is the only player which offers its users a seamless access to 44 million WiFi hotspots in over 100 countries, including international flights and rail systems in partnership with global players. The BSNL users just need to download an app for the same.

Apart from key developmental institutions, WiFi hotspots will be set up in malls, open parks, restaurants, railway stations (around 400 stations already have free Wifi by Railtel in partnership with Google). Many of the places, public WiFi is free, but in some areas, it is free initially for 15-30 minutes, then a user needs to buy a top-up, which comes in various denominations – Rs 15, 20, 50, 100 and so on.

Kawoosa said with over 97% of the broadband users coming from wireless technologies like 4G, the entire ecosystem has to come up with innovative as well as sustainable and scalable measures to have over a billion broadband wireless subscribers. WiFi will quicken the process of getting the remaining 500 million users on the Net.

"India is one of the countries where data growth is the highest in the world, not just because of the size of the country, but per capita. We must not underestimate the hunger of rural data because this is their way of integrating with the mainstream and this will also bridge the infrastructure, income and opportunity divide," Sundararajan said.

BharatNet Usage Status
as on 24-12-2018

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