Nevertheless, Ozone believes its biggest revenue generator will be WiFi-offload agreements with mobile operators, even though it has yet to sign any deals. "WiFi offload is the only way the economics of WiFi can work," insists Sarin. "Nearly 70% of our revenues will come from WiFi offload."
Sarin is optimistic about this opportunity because growing data consumption is already forcing India's service providers to think about shifting traffic off congested 3G and 4G networks. India's spectrum shortage is also putting pressure on the country's operators.
Although a few service providers -- including Reliance Jio, Bharti Airtel Ltd. (Mumbai: BHARTIARTL) and Vodafone India -- are setting up their own WiFi networks, Sarin reckons operators will eventually see the advantages of using Ozone for WiFi offload. (See Tata Teleservices on Hunt for WiFi Partners and RJio to Drive WiFi Rollout in India.)
Government authorities believe that WiFi will play a critical role in making Internet accessible to the general masses in India. Indian Railways recently announced it would provide free WiFi to its passengers. And the newly elected government in Delhi has promised to provide WiFi coverage in the city within two years.
Government orders for WiFi deployment are likely to become a battleground for operators. Service providers like Bharti Airtel, Vodafone, Reliance Jio and Tata Teleservices Ltd. , besides players like Ozone, will all be vying for a piece of this business.
At the moment, India has only about 30,000 commercial WiFi hotspots. But community-backed hotspots are expected to number more than 2 million by 2018, according to recent research from Maravedis Rethink Analytics, an analyst firm, and iPass Inc. (Nasdaq: IPAS), a WiFi connectivity company.
While Ozone has yet to make any profit, it is optimistic about doing so next year. "We are still in the investment mode because we are rolling out more hotspots," says Sarin. "We have a business plan to start making money by the end of 2016. The more coverage I have the more revenue I will generate."
According to press reports that appeared late last year, a UK-based company called New Call Telecom has made an investment in Ozone, although the details of it are unknown.
— Gagandeep Kaur, contributing editor, special to Light Reading