Railwire, the broadband arm of Indian Railways, has started operations in hundreds of cities across India ahead of the launch of Reliance Jio and is offering tariff that are less than half that of its main existing competitor BSNL.
For example, BSNL offers only 8 GB of data at 4 Mbps speed for Rs 999 per month.
Similarly, BSNL offers 20 GB for Rs 1,275 per month at 4 Mbps, while Railwire offers 60 GB at a blazing 10 Mbps speed for Rs 1,249 per month.
The railway broadband provider’s 10 Mbps plan starts at just Rs 1,099 per month, offering a cap of 40 GB after which the ‘speed’ gets reduced to 1 Mbps.
The company enjoys an advantage that no other telecom operator in India can boast of — a pan-India network of almost unutilized fiber network along its rail lines.
The total length of the fiber line along the railway track is 42,000 km. In comparison, an operator like Idea Cellular — which has been in telecom business for over two decades — has fiber of only around 1 lakh km.
Out of this 42,000 km, 10,000 km has been enabled with dense wavelength division multiplexing or DWDM technology, which increases the capacity of the cable by 50 to 100 times.
At present, Railwire — which is a unit of Railtel — has operations in 400 towns across the country. The operations started late last year and are scheduled to scale up through 2016.
The company operates mostly through a franchise model. Any local network provider, such as a local cable operator or MSO, can approach Railwire for reselling Internet services by registering on their website.
However, the local operator is not allowed to change the tariff plans, and customer service is taken care of by both the company and the local partner together.
There are, however, reports of local cable operators trying to overcharge customers by imposing their own ‘service charges’ on top of the tariff offered by the company.
It also offers ‘direct connection’ without a local partner, for which you have to apply online. However, this is subject to location constraints.
Another issue that has been reported in taking direct connections in some areas is the problem of rowdy local cable operators who do not let the company draw fiber optic connection to the customer’s household claiming that the place belongs to ‘their area.’
As of now, most of the connections so far are through cable operators. Most of the early operations have been in Tamil Nadu. However, other states like Maharashtra and Kerala have also caught up since then.
Railwire could turn out to be an alternative to BSNL, which is on the verge of being competed out of the market due to the emergence of 4G services from players like Reliance Jio, Idea Cellular and Bharti Airtel.
BSNL suffers from high expenditure, which increases its tariff and this in turn reduces the number of customers. The company is likely to see a massive loss in its subscriber base in coming days with the launch of Jio and other 4G competitors.