The Telecom Regulatory Authority of India (TRAI) is facing a severe backlash from the country's major telcos – Reliance Jio, Bharti Airtel and Vodafone Idea – for its draft proposals regarding the central government's major public Wi-Fi initiative, the Prime Minister WiFi Network Interface (PM-WANI).

The TRAI recently proposed that telcos and Internet service providers (ISPs) should bring down broadband connection rates charged from Public Data Offices (PDOs) under the PM-WANI scheme. Local businesses like small shops can become a PDO by setting up a Wi-Fi access point and purchasing services from a service provider. Alternatively, an entrepreneur may start a business purely as a PDO. Either way, the PDO effectively connects the last mile in the PM-WANI scheme. According to the new draft proposals, they should be charged the same as retail broadband connections.

"The Authority has analyzed this issue and is of the view that it is necessary to rationalize the cost of broadband connectivity to PDOs to pace up the proliferation of the PM-WANI scheme. Accordingly, the Authority proposes that for the purpose of providing PM-WANI scheme, tariff for Public Data Office under PM-WANI scheme shall be the same as is applicable for retail broadband (FTTH) connections," says the TRAI press release.

The telcos are protesting against this proposed amendment. "We are surprised to see the Draft TTO [Telecommunication Tariff Order] on the tariff aspect of the PM-WANI scheme, which has never been discussed with the stakeholders. We understand that before issuing this Draft-TTO, TRAI should have done consultation on desirability of PDO service, in the light of current proliferation of 4G/5G services and availability of data services at cheapest rate in the world," said the Cellular Operators Association of India (COAI).

Limited uptake of PM-WANI scheme

The PM-WANI scheme was launched in 2020 with the intention of providing affordable Internet across the country, especially in rural areas, through Wi-Fi. The scheme was designed to create employment for small and micro-entrepreneurs while bridging the digital divide in the country.

It was envisioned to have a similar impact to the Public Call Office (PCO) scheme a few decades back. The PCO was nothing short of a revolution in the 1980s and 1990s, making it possible for the ordinary person to easily and affordably make national and international calls. Later, several PCOs turned into cyber cafes before being rendered obsolete by the mobile revolution. The PM-WANI scheme and the PCO scheme both use local small businesses to expand connectivity.

Unfortunately, the PM-WANI initiative never really took off. As of July 22, 2024, around 207,642 Wi-Fi hotspots had been deployed in the country, far below the target of 10 million by December 2025. One of the reasons for the limited uptake of the PM-WANI program is the growth in 4G availability at affordable rates.

"Today, the massive and ubiquitously available telecom networks are the natural choice of subscribers when it comes to using mobile data. This is also the reason for the decline in consumer interest when it comes to the PDOs' WiFi services," said Airtel in its comments on the TRAI proposal.

"In our opinion, PM-WANI service is no more relevant. The inherent flaws in this model caused by mobile data availability and its low costs led to the failure to take off of the model," Reliance Jio told the TRAI.

Jio also argues the TRAI's proposals are financially unfeasible. It says if the draft TTO is implemented, "a PDOA [Public Data Office Aggregator] can get unlimited data at Rs 399 ($4.76) and sell at least 1 GB data to (say) 1000 customers in a month at the below market cost of Rs 10 ($0.11) per GB (mobile data pack for 1 GB is for Rs 19 ($0.220)), making a windfall of over 2000%, while simultaneously depriving the TSP [telecom service provider] a possible revenue of Rs.19,000 ($226.7) and Government its revenue share by selling same number of 1 GB data packs." This calculation is based on the current rate of INR 649 ($7.74) plus taxes for 4G data services and INR 399 ($4.76) plus taxes for 30 Mbit/s speed for FTTH customers on the Jio network.

The telcos also argue that since the PM-WANI uses funds from the Universal Service Obligation Fund (USOF), which is supported by contributions from service providers, no additional burden should be imposed on them.

On the other hand, Broadband India Forum (BIF), which represents tech firms like Meta and Google, among others, says that the TRAI is right in asking telcos to reduce the charges for broadband connection.

"It [the PDO booklet issued by the government] mentions typical annual broadband cost for PDO as Rs.6000/- ($71.59). However, there is a huge price difference in broadband connectivity cost, which is between Rs. 4 lakhs ($4772.68) and Rs. 8 lakhs ($9545.62) annually being asked from PDOs, and Rs. 6000/- ($71.59) annually as mentioned in DoT's PDO booklet," says BIF response to proposed changes.