How this hyper-local content delivery network connects running trains, airplanes to the internet

Internet has become electricity in modern times. With the rapid adoption of smartphones and cheap data, India has emerged as one of the largest users of the internet in the world. The Covid pandemic acted as a catalyst to further push this trend. Enterprise digital adoption is also growing rapidly. Against this background, SugarBox Networks – a hyper-local content delivery network – is witnessing rapid demand for its services. Founded in 2016 by Rohit Paranjpe, Devang Goradia and Ripunjay Bararia, the company uses a patented technology platform to provide seamless internet connectivity in metros, trains, rural areas and other locations. Already linked with Chennai and Hyderabad Metro, Central Railways (Mumbai Suburb) and now available in over 500 villages across India. In a conversation with Bizz Buzz, Rohit Paranjpe, the company’s co-founder and CEO, said in a landmark move that it has now tied up with Air Asia to provide services inside airlines when there is no internet connection. He said the company is doing well in 2022 and will double down on new initiatives next year. He also said that the company will increase rural consumers by 10 times in 2023 and explore the possibility of cooperation with more airlines. The Zee-backed company has already achieved operating profit and will continue to invest in its growth ahead of revenue on an enterprise basis.

How do you see the recent growth of the cloud computing industry? Can you give some distinctive features of this growth cycle?

The macro factor of even small businesses looking to go hyper-digital has driven cloud demand. The industry had always factored in that demand would eventually return to normal conditions. However, there is a factor in the industry that such demand growth does not put pressure on ancillary services. For example, no one thought that high demand would overwhelm the network. No one thought that people from remote regions would enter. Therefore, the infrastructure needed for this has never been considered. This has led to the creation of many ancillary industries, generating employment.

Second, cloud demand blurs the line between several related services. For this reason, we are witnessing that telecommunication companies are creating their own cloud platforms. We have also seen big tech giants like Google, Meta trying to get into connectivity solutions for last mile connectivity. The network is coming in with the launch of 5G. So a lot is happening in this industry and what falls under cloud computing has become quite dynamic. 5G, with satellite technology; these lines will become even more blurred in the coming years. Cloud computing will form the basis of hyper-digitalization initiatives. This is why this opportunity is so great. During the Covid pandemic, many things around us have gone digital. But there is much more that has yet to be digitized. This industry is growing very fast and it will not only be from current applications but also from future applications.

How was the demand for SugarBox Networks in 2022 and everything back to normal? What are your predictions for the coming year?

The demand for us has increased. This is because people are out. We are a unique cloud platform that provides a hyper-local platform. For us, demand for our services has increased since the pandemic as people have gone out. For example, within mobility when people travel on trains or buses; in hospitality, in retail, we add value when they’re at home, when they’re on the go. So, people use our services while traveling in metros. We are connected to many metros. We have partnered with many divisions of Indian Railways and are expanding our footprint there. We have already launched our hyper-local content delivery services on airplanes. This is a path-breaking moment for us. We see a lot of demand for this service not only in India but also globally. So, 2022 is a remarkable year for us when mobility returns.

By 2023, we see this momentum increasing even more. We have launched our services in alliance with Air Asia. We want to double this service and capture 50 percent of the airline market in the country. We have doubled the government’s digital India initiative in 2022. With the advent of 5G, rural India continues to be a big focus for us. In 2023, we are waiting for our rural audience 5-10 times. In mobility services, we will focus on providing contextual services to the audience. Today, we provide content services through our OTT platform or provide services for shopping through our commerce platform. In 2023, we will focus on the most relevant experience that the consumer needs. Satellite technology and the unlocking 5G will open many opportunities for providing hyper-localized services in airlines. We have run OTT application inside airlines without internet connection. This is a significant step for us.

Can you shed some light on the segment-wise revenue contribution for SugarBox Networks?

Currently, our revenue is equally divided between metros, airplanes and rural India. We have a large presence in rural India with around 500 villages. Categorization is more appropriate. Across categories, video is our most important segment, generating approximately 35-38 percent of our revenue from videos. It’s primarily OTT today, but we expect it to expand with more short-form video providers. The second is trade, which is close to 30 percent. We have all kinds of brands. In the coming months, people involved in last-mile mobility solutions will contribute significantly. Finally, edtech is untouched. As the demand for such solutions grows in rural India, we expect it to add 15-18 percent of our revenue pie next year. We are in talks with all other startups like Fintechs, Healthtech and others to see what relevant services we can provide. We are actively exploring that space.

Do you have any exclusive agreements with any cloud hyperscalers or do you work with all the major players?

We do not have an exclusive agreement with any player. We work with most major players.

How big is the team now? What are your recruiting plans for next year?

We are now a team of 250 people. About 150 people make up the engineering staff. Next year is going to be very interesting because this is the time when the truly disruptive startups will begin to grow.

Can you comment on the profitability front? Are you now operationally defeated?

We lost at the operating profit level. But we are an infrastructure company and we need to invest in capital expenditures. So, breaking even as a company is a five-year goal for us. This is not a short-term goal for us. As an end goal, we see a public listing as a possibility, but we’re five years away from that if that happens.

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