GOOGLE, FACEBOOK, JIO TO BID FOR RAILWAY WI-FI PROJECT
In what can be considered as the biggest digital drive by any entity in India to make internet available to the public, the Indian Railways is set to cover more than 7,700 rural railway stations in the country with wifi soon. According to industry analysts, the advertisement sales revenue from such wi-fi spots could be as high as $2.5 billion by 2020 for companies that are planning to bid for these projects.
“Already, a large chunk of urban stations under A and A1 category have wi-fi. Now, railway subsidiary RailTel Corporation of India (RailTel) has invited tenders for covering 7,700 stations in the D, E and F categories,” said an official in the know. The Indian Railways has around 8,500 stations across the country.
In the largest wi-fi tender that the country has ever seen, RailTel has invited bids from contractors for “supply, installation, testing, commissioning, operation and maintenance of wi-fi services at 7,700 rural railway stations,” and the final date for submission is May 4.
The bidding is being conducted on a reverse auction model, where prices will decrease as the sellers underbid one another to obtain business from the buyer. The railways have decided to go in for reverse auction from April 1 for high-value items, including wagons, locomotives, coach parts, and signalling and track equipment. The transporter expects to save ~100 billion a year through reverse bidding.
According to market estimates, globally the public wi-fi network will be worth around $34 billion by 2020. India with its ever-expanding user base will be worth over $10 billion itself by then. Companies such as Google, Facebook, Airtel and Reliance Jio are planning to bid for these projects, sources said.
In 2016, RailTel had roped in Google to set up wi-fi hotspots in 400 A1 and A category stations, which the latter has completed. It has been successfully running ‘RailWire’ and has been able to connect millions of new users in Tier-II and TierIII towns. When a company does not charge for any of its services, it monetises wi-fi with the help of advertisement revenues. “Ad sales will be a huge money churner for players like Google. They will be able to tap into a new set of customers to which they can pitch their products,” said a source close.
While Google is one of the top contenders for the project, Facebook is also planning to pitch its public wi-fi plan with the Indian Railways. It runs such a project with Airtel. Facebook is coming up with 20,000 wi-fi hotspots in India.
Reliance Jio, which has a plan to launch 1.5 million wi-fi hotspots across India, is eyeing a chunk of the railways project, sources said. According to railway estimates, by 2017 end, around 6 million people were using RailTel wi-fi services through Railwire Fast Wi-Fi services.