Tata Communications Plans to Deploy Nationwide LoRaWAN Infrastructure in India

On the November 3, 2017, Tata Communications Ltd announced plans to invest US$100 million in IoT over the next three years. This follows an earlier announcement from Tata Communications in March to deploy over 10,000 Kerlink Wirnet iBTS compact gateways in tier 1,2,3 and 4 Indian cities, following the successful pilot study of LoRaWAN from June 2016 in three major Indian cities. 

The Tata Group is one of India’s largest conglomerates, with over 100 independent companies employing 700 thousand people with revenues of around US$100 billion in 2017. One of the 30 publicly listed enterprises of the Tata group, Tata Communications, is a global provider of telecommunication solutions and services to enterprise customers and service providers in 38 countries worldwide. According to Tata Communications, LoRaWAN IoT network is commercially available in 38 cities today and expects to expand its nationwide coverage to include 100% population coverage and 90% geographical coverage by the end of 2018.

Tata Communications is most likely to witness the most traction in the following vertical markets:

1. Smart Metering - A key target market where Tata Communications expects to leverage the National Smart Grid Mission(NSGM) which plans to implement a nationwide roll-out of smart electricity meters. By the end of 2016, out of the 300 million metering points in the country, ABI Research estimates there were around 1 million smart meter connections from cities such as Mumbai, Delhi, Surat, Baroda, and Puducherry. Out of the 17 pilot projects conducted by the NSGM, 13 projects have been awarded contracts, and four projects are still under consideration. Battery operated smart gas and water meters are perhaps the most significant target markets for LoRaWAN that remains untapped.
2. Smart Street Lights - According to the Government of India, there are around 35 million conventional streetlights in the country that will be replaced by LED-based streetlights by the end of 2019 under the Street Light National Program (SLNP). According to the online dashboard of SLNP, 3.8 million LED streetlights have been retrofitted as of November 6, 2017. The replacement program has primarily benefited from locally sourced low-cost LED luminaires. The smart streetlights adoption in India is so far limited due to higher costs involved in connecting individual streetlights. Some tier 1 and tier 2 city municipalities have issued RFPs for smart streetlights in 10’s of thousands. Control Management Systems(CMS) grouping multiple streetlights leveraging a low-cost public LPWA network will drive adoption.
3. Enterprise Wearables - Some of the Tata Group companies have come together to develop a wrist-worn enterprise wearable device targeting worker safety in factories. Tata Elexi designed the watch and it is manufactured by Titan (a luxury goods manufacturer) leveraging Tata Consulting Services Cloud-based data analytics platform. The wearable device is currently undergoing pilot tests with workers employed by Tata Steel and will eventually move to other group companies such as Tata Chemicals and Tata Motors. The wrist-worn wearable device is expected to be commercially available by 2018. 

Furthermore, In February 2017, HP and Tata Communications had also announced their collaboration to deploy some IoT applications such as smart buildings, fleet management, and healthcare using HP’s Universal IoT platform which leverages oneM2M interoperability standard. Although most of the above-listed use-cases are currently in various stages of proof-of-concept, they are expected to scale in the next 12-18 months with broader network footprint. 

In India, Tata Communications competes with Bharti Airtel, BSNL, Vodafone, and Reliance Jio, a new entrant and disrupter in the telco ecosystem. Tata Communications claims to have around  one-third of the market share in the enterprise business, and its IoT business will leverage its existing strengths by focusing on the b2b market. Vodafone and Airtel are more focused on the enterprise market; whereas Reliance Jio is likely to focus initially on the B2C market. The smart grid modernization effort in India is still in preliminary stages, and Vodafone is the only telco in India to participate in a pilot project in the Northern state of Himachal Pradesh. Energy Efficiency Services Limited (EESL) recently floated a tender to acquire 5 million smart meters from Infrastructure engineering company Larsen and Toubro, who recently won the bid to supply 2.5 million smart meters at US$42 per unit. Similarly, The Government of India has allocated US$20 billion to develop 60 smart cities. As of 3Q 2017, out of the total 731 use-case projects approved, 49 projects are being implemented and only 24 projects have been completed. There’s growing consensus in the industry about the sluggish growth and delays across many flagship government projects focused on digital transformation.

Reliance Jio has been a disrupter in the Indian telecommunication industry, witnessing exponential growth with over 100 million broadband and VoLTE customers within six months of its launch. Although Reliance Jio has not deployed a cellular LPWA network technology yet, it could quickly roll-out CAT-M or NB-IoT through a software upgrade with its advanced LTE infrastructure. As Indian telcos witness drastic shifts in revenue streams from voice to data, connected, IoT devices will contribute substantially to telco revenues. ABI research estimates, IoT in India by the end of 2022 will generate revenue more than US$5.2 billion across the value chain.