COVID 19 sets new horizons for some Indian businesses

Three years ago, Space World emerged as brave and innovative start-up in the previously untapped and somewhat unknown world of digital indoor solutions. Now, the company has expanded its dominance in the Indian IBS-DAS market, scaling up to nearly 700 tenancies while covering 280mn sq. ft. of saleable areas across the country. Further, Space World is tackling the huge peak of data demand in the market and has recently started rolling out small cells and fibre. We have caught up with Space World’s Co-Founders Ankit Goel and Radhey Raman Sharma to review one of the most impressive expansion stories in the region and hear how the company is keeping hospitals and metro users connected during the pandemic.

TowerXchange: Could you please give us an update on Space World’s expansion since last time we spoke?

Ankit Goel, Co-founder & Manager Director, Space World: Since we spoke last over a year back, there have been a lot of changes at Space World making it a more holistic passive infrastructure provider of both indoor & outdoor digital solutions. Not only have we consolidated in our core area of IBS-DAS by scaling up to nearly 700 tenancies, covering 280mn sq. ft. of saleable areas, but we have also entered the new, exciting and fast-paced world of outdoor small Cells and FTTX.

Surely, we have been impacted by the COVID-19 global pandemic, but at the same time the outbreak has resulted in a huge surge in indoor data usage thus creating a large void between data demand and supply. Mobile and data connectivity is playing a crucial role in keeping companies functional in a time of lockdown and work from home. Even on the consumer side, OTT platforms & heavy video downloads have emerged as high data gobblers.

Fortunately, we could play a significant role in helping our clients to serve their customers better during the pandemic by ensuring a high 99.99% uptime. Moreover, we recognized the critical need for connectivity in hospitals and our acquisition team was able to pick up deals with nearly 100 large hospitals all across India. Further, due to a rapid surge in data demand, we ventured into newer product lines like ODSC and ResNet (for hi-rise residential buildings) and even launched our subsidiary RANext for FTTx services during this period. We are now looking to expand into the RTP (Rooftop poles) and HPSC (High Power Small Cell) segments to support our customers’ strategy to go for a deeper citywide penetration.

TowerXchange: How is the need for indoor coverage evolving in India and how is the pandemic impacting your business?

Radhey Raman Sharma, Co-founder & Director, Space World: During the pandemic, the surge in voice & data demand was skewed towards residential, hospital & suburban/rural areas. Indoor consumption of data at 80% was led by high data usage, which touched 12 GB-16 GB per month for the customers of all leading opcos. Hospitals witnessed high footfalls while online gaming, OTT and WFH led to a surge in demand from residences.

Operators have shown 30- 50% increase in data y-o-y leading to greater capacity building and hence higher need for IBS, FTTH, ResNet as well as ODSC solutions. While we didn’t add any new sites/tenancies during the earlier part the pandemic, in the last couple of months we have resumed building new sites and adding tenancies while ensuring great uptime to our clients on all our existing sites. Last month, the metros and airports also became operative and the Space World team ensured a seamless transition to normalcy across all these locations. Importantly, we developed our first 100 ODSCs in the last quarter and are extremely bullish on scaling this new, exciting business opportunity in the coming months across the leading cities in India.

TowerXchange: Could you please share some success stories around IBS?

Ankit Goel, Co-founder & Manager Director, Space World: Over the last year, Space World has been able to tap the maximum potential from the indoor data surge and has acquired many iconic and large projects and buildings/public footfall areas all across the country. Some of these are DLF Cyber Park, DLF Saket Mall & Pacific Mall in the Delhi NCR area , Kohinoor Square in Mumbai, Jaipur metro, Goa, Kannur, Calicut, Coimbatore & Dibrugarh airports, AIIMS Rishikesh etc. Further, we launched our ResNet solution in the Delhi NCR area to improve connectivity in prime high-rise residential projects.

One of the examples of a marquee site where we are providing an integrated communications solution is the 4mn sq. ft. DLF Cyber Park in Gurgaon, which is a world-class corporate complex that will have nearly 30,000 occupants when ready by early 2021, housing leading corporates such as Bank of America, Gartner, EY and WPP etc. Space World has adopted here an integrated approach offering a passive DAS solution along with fibre deployment to enable leased line connections and broadband availability as well as a Wi-Fi for common areas.

TowerXchange: Are you exploring any partnerships with towercos or any other synergies with utilities, government, transportation companies or other enterprises?

Radhey Raman Sharma, Co-founder & Director, Space World: Space World is always open to exploring opportunities for any collaboration be it with operators, OEMS, government agencies, towercos or transportation companies for a right mix of deliverables.

So far, we have been working successfully with leading Metro Corporations across 60 stations in Delhi, Chennai, Lucknow and Jaipur as well as Airport Authority of India for 14 airports. Also, we are working with State Governments focusing on hospitals as a focus segment. Besides, we are working on several projects with multiple private and government entities and in this context, have tie-ups with several consultancies as business associates to deliver large institutional sites for the government. We are also working closely with municipal corporations, metros and smart cities for bulk ODSC deployment and OFC, which will also be useful for future 5G deployments.

TowerXchange: Many things are happening now on India’s telecom market. What will be the impact of the consolidation in both the MNO and towerco front for a company like Space World?

Radhey Raman Sharma, Co-founder & Director, Space World: The MNO market is at an equilibrium post consolidation in the last few years, as a four-player market – with three private players and one government-owned. The private operators are now focusing more on “customer service and network” that maximises their resilience while simultaneously supporting their ability to offer bespoke, carrier grade services.

With ARPUs expected to rise, there is a race for acquiring high ARPU users and improving customer and revenue market share amongst MNOs. Here, QoS in indoor spaces would play an important role for players like us as it is a direct growth opportunity. Space World is a leader in the fast growing niche of indoor digital solutions, so consolidation in the wider macro cells market has limited impact on us. Also, to the extent that MNOs want to diversify their vendor base, consolidation only increases opportunities for players like us. Moreover, we have a huge opportunity to build up a nation-wide ODSC business for the MNOs which will not only support their current 4G led data explosion but also build a solid foundation for the imminent 5G launch.

TowerXchange: What is your vision for Space World and what are your expansion plans?

Ankit Goel, Co-founder & Manager Director, Space World: As the importance of indoor connectivity increases, and it has been accelerated by COVID-19, it will open up the market for many more digital solutions in areas like connected homes, security & surveillance solutions, Triple play services, parking & visitor management, et cetera. These applications shall all require strong digital infrastructure.

Space World aspires to enable this revolution by becoming the leading digital transformation infrastructure company, a market leader in all the segments that it operates in. We already have and shall continue to acquire marquee underground metro stations, airports, hospitals, corporate buildings and residential complexes. To achieve this, we will leverage our USP of acquiring marquee sites and specific locations where the MNOs seek to deliver seamless voice and data connectivity to their customers. We are working on simultaneously expanding our solutions to emerge as a single window digital infrastructure partner for all realtors, developers and government agencies for any digital services to be deployed on site.

Space World will position itself as an innovative provider of integrated communications solutions encompassing a mix of IBS, outdoor/RTP, ODSC and fibre solutions. We would like to build a Space World brand that is known for its quality, reliability and trust across all its stakeholders including MNOs, realtors, partners and employees.

In the next five years, while the opportunity for IBS-DAS is expected to grow almost three fold, in the ODSC space there will be exponential growth with the number of small cells almost touching the number of towers by 2025, give the current data explosion and 5G launch. Equally, with a low home penetration of broadband, FTTH will see a huge growth as well. Space World is well positioned to achieve scale in all these segments along with the RTP space - which is replacing the need for towers given the various space constraints in large cities. Further, riding on high market share in the IBS segment, a solid and experienced management and operational team as well as aggressive business plans, we aspire to scale up our footprint, scale and share of the business multi-fold in the next two to three years.

TowerXchange: Are you exploring any fund raising to fuel your expansion plans?

Ankit Goel, Co-founder & Manager Director, Space World: We have initiated a fund raising process and are in discussions with various private equity and infrastructure funds supported by our investment advisor Ambit Private Limited. We are envisaging significant capital requirement to support our aggressive growth plans in IBS, ODSC and FTTx. Currently the company is cashflow surplus and books are debt free and the new funding will directly fuel our expansion plans.