The document proposes bringing internet access to rural India using mobile "cyber cycle" rickshaws equipped with WiFi routers, batteries, and tablet computers. Each rickshaw would travel through villages providing internet access to users for a small fee. Riders would generate power from the rickshaw's dynamo to charge the batteries. The business model is projected to be financially viable with a positive NPV. The innovative solution could replicate internet access in remote areas lacking traditional infrastructure.

1. BRINGING
INTERNET
TO RURAL
INDIA
Kajetan Maria Bocek, Rochelle
Haw,
Niki Lintmeijer, Clemens Meyer,
Julian Milton Underdown
18.02.2013

2. What is the Internet used
for?
Communication Information Entertainment

3. Internet in rural India
833mRural population
38mInternet access
Access to
information
Average distance
to Internet
6.6 km
Rural coverage
increasing
3G

4. Reasons for non-using
No Internet
connection
No PC at
home
Improper
electricity
supply
No Internet
at school
Can't afford
Internet
Lack of local
language
content
59%
39%
35%
6% 6%
3%
Lack of awareness
Lack of means
Source: IAMAI (2012) Internet in Rural India
60%
40%

5. Bringing Internet to rural India
one rickshaw at a time
“ ”

6. The Cyber
Cycle

7. How it works
The technology box
- 3G WiFi router
- Amplifier
- Battery
Dynamo
3G antenna
Seats for users
Storage for tablets

8. How it works
Chennai
2 hours travel
10 hours total
8 hours Wifi

9. Use Cases
Users
Information
Communication
Weather forecast
Crop prices
Doctor search
Entertainment
Education
Rural population
Literate
Basic education
Speak Tamil
Medium income
Farmers
Artisans

10. Value Curve
Internet on mobile
cycy Internet
Internet cafe

11. Value Architecture
NGOs
IT
University
Primary Activities Support Activities
+

12. Cost
Revenue
NPV $689*
EBITDA $900 p.a.
Revenue
per year and rickshaw $2400 Operating cost
per year and rickshaw
$1500
$950 of which salary
Investment
per rickshaw
$1540
Revenue
per 20 minute time
slot
(about 20 US cents)
Rs 10
*Time: 5 years; CoC:

13. Expansion
Plan
Rickshaws
per base
Bases
Rickshaws
(total)
8
1
8
Y1
10
2
20
Y2
12
5
60
Y3

14. Bringing Internet to rural India
one rickshaw at a time
“ ”

15. Q A

16. Backup

17. Point of accessing Internet
Cyber Café > 10
km away
Cyber Café < 10
km away
Home Other public
computer
Friend's home Mobile
29%
27%
19%
17% 16%
12%
Source: IAMAI (2012) Internet in Rural India

18. Tamil Nadu
• 72m population
• 56% live in rural areas
 40m rural population
• 73% rural literacy rate
 29m rural literates
• 28% of rural population lives below poverty line
• Assumption: most illiterates are also poor
 27m rural literates above poverty line
Internet usage
• 60% are interested in using the Internet
 16m potential customers
• Assumption: We can reach one third of them (competition, specificity of our model, ...)
 5m customers
• Assumption: Every customer uses our service for 20 minutes every two weeks
 130m slots à 20 minutes per year
• One slot = $0,20
• Total market size of $26m in Tamil Nadu
• Total market size of $437m in India, assuming equal usage
• One cycy rickshaw serves 13 000 customers per year
• 385 cycy rickshaws required to serve Tamil Nadu
• 6200 cycy rickshaws required to serve India
Market size estimation
$26m
$437m
Market in Tamil Nadu
Market in India

19. Energy consumption
• 3G Wifi router consumes about 2,5 Watt
(300 mA @ 12V in communication mode, 120 mA @ 12V in idle mode)
• Normal bike dynamo generates about 5 Watt, special models up to 15
Watt (while driving)
• Light cycling equals about 50 Watt; in stationary mode, up to 40 Watt
input (assuming 80% efficiency of the dynamo) could be reached with a
special dynamo
• Nexus 7 charges at 5V, 2A  charging 2 Nexus 7 at the same time (@
10V, 2A)
Energy storage
• A lead-acid battery (12V, 24Ah) would cost around 100 € (excluding
charging logic)
• End of life (= <80% of original capacity) after 5 years
• The router alone could run 24Ah/0,2 A = 120h = 5 days on the battery
• Can charge two Nexus 7 (@10V, 2A) for about 12 hours
• Battery could be charged by stationary cycling (@40W) in about 7
hours
Energy
Overview

20. Marketing Plan
Rickshaw drivers NGOs
• Leverage existing
education and
information access
projects
• Offer first two
weeks of use for
free
• Demonstration of
uses through the
driver

21. Does the business model generate some form of revenue?
• Yes. (B)
Does it offer a radically new value proposition?
• Yes, it offers Internet access in a new way. (C)
Does it rely on a radically new value architecture?
• Yes, it has not been done before with this architecture. (C)
Is it innovative, i.e. hasn’t it been done before in the same market?
• Yes, it has not been done before (to our knowledge). (B)
Is it replicable, i.e. not anecdotal?
• Yes, it could be applied to many other regions and countries. (A)
Innovativeness

22. Financials
$597
$180
$150
$100
$300
$-
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
Investment
Rickshaw
Installation
Divers
cables
Router
Generator
Batteries
Antenna
Tablets
$150
$200
$950
$200
$2,401
$901
Operating costs Revenue EBITDA
$-
$500
$1,000
$1,500
$2,000
$2,500
Operations (Year 1)
Insurance
Salary
Internet
access
Maintenance
Key assumptions
• 60% usage ratio
• 10Rs/20 minutes
• 5% yearly revenue growth
• 32.5% corporate tax rate
• 20% cost of capital
$802.52
$(1,000.00)
$(500.00)
$-
$500.00
$1,000.00
1 2 3 4 5
Year
Cumulative discounted FCF

23. • General administration: $4000
• Marketing (other) $1000
• Cooperation fees (e.g., price money) $1000
• Training of drivers $200
• Hub rental $800
$7000 (per year)
• EBITDA per rickshaw $900 (per year)
Overhead
costs

24. Revenue
• 3 tablets
• 8 operating hours/day
• 10Rs/20 minute time slot
• 60% usage ratio
• 300 operating days/year
Revenues: $2400 / year
Financials
Cost
Investment per rickshaw: $1542
Operating costs: $1500
• Salary: $950
• Maintenance & insurance: $350
• Internet access: $200
EBITDA: $900 / year
DCF:
Time: 5 years
CoC: 20%
NPV: $689

25. How it
works
The technology box
- 3G WiFi router
- Amplifier
- Battery
Dynamo
3G Antenna
Seats for users
Storage
Tablet computers
- Internet access
- Custom apps
- Durable