Reliance Jio’s big wifi bet to decongest its network, free up spectrum

Sunny Sen February 15, 2018 6 min

India has set itself a goal of half a million wifi hotspots by March 2019, the end of the coming fiscal year. This is as ambitious as government targets go: a 16x growth from fiscal 2017. But, for a change, this target may be met and even surpassed thanks to the massive deployment of wifi hotspots by Reliance Jio.

Jio, the world’s fastest-growing mobile phone services provider, has been quietly rolling out wifi hotspots across the country and is close to 200,000 public wifi zones already. That’s not all: by the end of 2018-19, it has plans to deploy 1.5 million wifi zones at stadiums, housing complexes, bus stops, public parks and tourist spots, schools and colleges, government buildings, and other places.

The Jio wifi hotspots are currently free to use.

“Anything in the telecom world needs unprecedented scale… Reliance thrives on that,” said a source with the company.

To be sure, Jio is running behind the target for wifi hotspots it had set itself during the September 2016 commercial launch of services. “​By the middle of next year, we plan to deploy nearly one million wifi hotspots,” Mukesh Ambani, chairman of Reliance Industries had then said. Jio is part of Reliance Industries, India’s largest company by revenues.

For Jio and Ambani, the public wifi push is aimed at reducing the load on the mobile phone base stations to be able to use spectrum in a more efficient manner. “Each wifi hotspot is connected with optic fibre and the locations offer better speeds than a SIM-based service. If a Jio user uses wifi, the load on the network comes down,” said a second company source. Jio has an optic fibre backhaul network of 300,000 km, the largest among Indian telcos.

Jio’s deployment of wifi hotspots reflects this strategy. It currently has some 100,000 base stations, which it wants to double in the coming fiscal year. The additional 1.3 million hotspots will carry bulk of the data instead of riding on the traditional mobile phone network.

A new pipe

Jio’s wifi plans dwarf others plans. Search giant Google has some 270 Google Stations, where the internet company has converted 270 railway stations into free public wifi zones. It recently announced taking the service to Pune Smart City.

Last May, it was reported that Facebook is tieing up with telcos and internet service providers to launch what it called Express Wifi to give internet connectivity to those who can’t afford it. This included a partnership with India’s No. 1 telco Bharti Airtel for 20,000 hotspots.

A regulatory expert foresaw a leg-up to internet penetration with the wifi rollouts. “About a billion people in India are still not connected to the Internet. Digital India cannot take off without higher internet penetration,” said Mahesh Uppal, director of telecom regulatory consultancy firm ComFirst. Digital India is the central government’s programme to usher in “a digitally empowered society and knowledge economy”.

Globally, offloading data on a telecom network to wifi hotspots is a common strategy among telcos and large players such as Verizon, Singtel, AT&T, Sprint and Etisalat have deployed similar solutions.

“Overseas it has become an offload tool. People don’t even know when you are on 4G or on Wifi,” says keen Jio watcher Kunal Bajaj, a former director at Paytm and ex-India head of consultant Analysys Mason.

India has a low penetration of high-speed wireless broadband – 67% of data users, according to Ericsson, are on 2G networks. Some 33% rides on 3G and 4G platforms, with the former accounting for bulk of this share. In five years, that is projected to change dramatically. By 2023, three out of five mobile users are expected to be on 4G, which makes it important for telcos to look for alternative routes for data.

This is all the more imperative for Jio if it is to widen its lead in data consumed among Indian mobile phone networks. It held a 34% share of data among wireless internet users with 138.62 million subscribers by the end of September, per data from the Telecom Regulatory Authority of India, or TRAI. Airtel was second with a 22.6% share and 92.18 million subscribers.

Jio, which has India’s only 100% 4G telecom network, counts only 15% of its network usage on account of voice calls; with the rest utilised for data. Up to 60% of spectrum at rival telcos, which rely on a mix of 2G, 3G and 4G networks, is used for voice calls. Once Jio is able to offload data usage to a wifi hotspot – the company says up to 70% of data on its network is consumed when the customer is stationary – it will be able to free up the airwaves to provide a better experience.

“What will be critical for Jio is to offload data in a way that makes commercial sense,” added ComFirst’s Uppal.

Path to a cost-effective internet

Surveys by TRAI suggest consumers like to use wifi services as long as it is free of cost or if the purchased data does not have a use-by date. “Consumers have also raised the issue of unutilized balances and remaining time of validity on their wifi purchases. Consumers were of the view that there will be more demand for wifi if unutilised amount can be used at some other locations,” reads TRAI’s final recommendations of public wifi.

Global and Indian research shows a strong correlation between internet use and economic growth. In its recommendations, TRAI talks how a 10% increase in penetration of the internet reflects in a 1.5% increase in GDP growth.

TRAI also mentioned that public wifi that offers sachet-size of “low denomination ranging from Rs 2 to Rs 20” will encourage proliferation of its use. To that extent, the regulator has said any company or individual can offer one or more hotspots for free or on a paid model.

Though the recommendations were made in March 2017, the department of telecommunications has not come out with a public wifi policy yet and may be part of a new National Telecom Policy slated to be published next month. Detailing this in an interview, telecom secretary Aruna Sundararajan had said that the government is targeting half a million hotspots in Indian villages.

Jio’s experiments with public wifi started as early as October 2015 when for a one-day cricket match between India and South Africa, it offered free wifi services at Mumbai’s Wankhede Stadium. According to the telco, 53% of the 27,500 visitors latched on to its wifi hotspots consuming 156 MB per user. Comparisons with other marquee sports events – Superbowl (412 MB per user) and NBA (61 MB) – were released then.

Jio has also wired up New Delhi’s Feroz Shah Kotla stadium with 600 hotspots.

So far, Jio has kept its wifi services free. Earlier, it was unlimited access but now any user can surf up to 30 mins without getting disconnected. Google also had started with unlimited access but has capped at 30 minutes high-speed usage at Google Stations after which speeds drop.

In future, the wifi service may be charged. For example, when a Jio customer gets into a Jio wifi zone, the data usage on wifi will get deducted from the data pack subscribed to.

“For non-Jio users, we will have to see how to charge them… At least the experience will be better than a wireless network,” the first source added. “For now, we are giving them limited access (20 minutes free wifi).”


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