Bangalore: 100 MB internet for Rs 2

6pack

6pack

ex-Mod
Source: Economic Times

"Data cost in India is very high at present. We believe that even after the launch of Jio there is a lot of room for price wars to happen and we are certain that we can drop the prices even further," says Wifi Dabba, cofounder, Shubhendu Sharma.

The Y Combinator- backed startup is already selling data at a significantly low price. Check out their data packages: 100 MB for Rs 2; 500 MB for Rs 10; and 1 GB for Rs 20 - with a uniform validity of 24 hours. Comparatively, Jio provides 150 MB at Rs 19 to its pre-paid customers and 1.05 GB at Rs 52.

This data is available in the form of pre-paid tokens sold by small shops like tea stalls and local bakeries in Bengaluru. "We do not ask our users to download any app. They just need to punch in their mobile numbers, fill in the OTP for verification, punch in the key and connect to the internet," explains Sharma.
For anyone who has accessed Wifi in a hotel, the process is very similar, where you connect to the Wifi Dabba network and a browser page opens for you to key in the details.

Wifi Dabba is a licensed ISP and it provides this data through small routers powered by fiber optics installed in these shops.
Click to expand...
 

The modus operandi
Doling out high speed data in pre-paid tokens Wifi Dabba has a diverse user profile. Sharma informs the startup currently enjoys the patronage of three main user groups - lower income peoples like masons, barbers and others who have already purchased their first Android systems, but can only spend a fraction of their daily wages on accessing data; school-going students who come to these wifi-enabled shops to download content; and local shopkeepers who are in the vicinity and require data.

"Instead of installing big towers like big telecom companies do, we are going to put lakhs of these small wifi dabbas across the city to develop a huge network which would cover the entire city of Bangalore," says Sharma.

Sharma says these wifi units are quicker and cheaper to build. "We spend Rs 4000 to roll out one dabba and 20 of these dabbas can achieve what one tower of big companies can, at a fraction of the cost," claims Sharma.

In comparison, it takes telecom companies anywhere between Rs 1-2 crore to set up a cellular tower. Clearly, economies of scale is what the startup is counting on to provide such competitive pricing.
 
If it wasn't sustainable, they wouldn't do it. Startups don't have much money to spend compared to bigger companies and every last bit of income is important. I'm sure they must have thought long and hard, even more than anyone, to see if the prices were profitable or not for them.
 
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