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BSNL to provide bandwidth to Facebook for Express WiFi project

BSNL will power Facebook express WiFi program which plans to install 20,000 WiFi hotspots across the country in remote and hilly areas where connectivity is low, according to this PTI report. Facebook signed a MoU with BSNL yesterday for acquiring backhaul spectrum/bandwidth from the state-owned telco for running the project, according to a tweet from the BSNL handle.

Facebook has partnerships with several ISPs like AirJaldi in Uttarakhand, LMES in Rajasthan, Tikona in Gujarat and Shaildhar in Meghalaya for its WiFi project. It also counts Airtel as a key Express WiFi partner in both India and African regions. Express WiFi was piloted in India in 2015, with more than 700 WiFi hotspots in partnership with 500 local retailers.

With this, Facebook seems to be running something similar to what the India telecom regulator TRAI had proposed in its recommendation in March. TRAI suggested setting up Public Data Office Aggregators (PDOs) that aggregate bandwidth from ISPs/telcos, perform authentication of users, and manage a network of local stores; this was similar to the PCO payphones that proliferated when personal phones were uncommon in India. With Express WiFi, Facebook ties up with small retailers (bakeries, cafés, juice shops, and so on) and distributes Express WiFi vouchers for cheap through those retailers which users use to connect to a nearby Express WiFi hotpsot.

In India, Bangalore-based startup WiFi Dabba also does something very similar to Facebook. The startup sells data ‘vouchers’ starting at Rs 2 for 100 MB of usage to customers walking into small shops/outlets that it has tied up with. Vouchers are also available for Rs 10 (500MB) and Rs 20 (1GB). Each voucher is valid for 24 hours. Here is more on how the startup plans to monetize using the PDO model.

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Issues with re-selling of bandwidth

TRAI allows telcos and ISPs to share bandwidth/spectrum with other operators under the spectrum trading guidelines. The regulator also allows operators to re-sell bandwidth, voice and data through agreements with Mobile Virtual Network Operators (MVNOs). What Facebook and WiFi Dabba are doing is pretty much similar to an MVNO, but TRAI has still not provided any clarity over whether unregistered small shops and other entities can re-sell bandwidth.

When Facebook formally launched Express WiFi in this month, we had pointed out that telcos and ISPs historically wanted to own the customer base. Some ISPs and telcos have also argued in the past that only licensed service providers should be allowed to re-sell bandwidth. TRAI, however, went on to release a consultation paper to resolve the debate. In March it started a consultation process on whether hotels, restaurants, kirana stores and small shops should be required to get an MVNO license to offer Internet access.

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