Exclusive Interview: Mathew Carley, Hayai Broadband

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Mathew Carley is a name to watch out for! He’s the man who is coming up with India’s fastest ISP, Hayai Broadband. It means a lot to the broadband deprived Indians. The broadband scene has been full of ups and downs in the recent past. ISPs have never understood the real demand for a high speed service combined with a tariff structure that doesn’t scam the consumer. Hayai Broadband is all set to change the way you browse the web on a high speed connection.

I managed to interview Mathew via e-mail.

1. What drove you to the Indian broadband market? Was it the pathetic state of broadband in the country?

I arrived in India having lived previously in countries such as
Finland, France and Japan over the past few years. At the time I had
left Finland in order to pursue personal opportunities, but only to
discover my access speed to the outside world had dropped by about
99.5%… or about the same in megabits per second.

Having arrived for the first time on the morning of 27/11/2008, it
wasn’t actually until March 2009 when I saw adverts for Reliance
Netconnect+ for 1899+tax for “Unlimited” service (with a FUP of 10GB)
that I thought to myself “I can do better”. I found a price for
leasing capacity on the SEA-ME-WE-4 cable from Tata, and even at that
price, after calculating as many factors as I could think of, I could
still do better. Significantly better.

It was shortly after that that I joined the India Broadband forum
(broadbandforum.in) and decided to disclose my idea in a thread
entitled “2009 and we are still stuck on 256kbps for broadband”. The
idea garnered support, so I began to take steps to formalize
everything and design a product around what customers want – providing
what they want is technically and financially feasible.

2. You’re setting up India’s fastest ISP here when major broadband service providers are struggling to put up a decent show. So far only bigger companies like Airtel broadband, Tata Indicom etc. have managed to stay up to decent levels of quality in terms of broadband services. How are you planning on providing the broadband-hungry Indian user, the ultimate high speed broadband feast?

The Fiber-to-the-home (FTTH) is largely untapped in India, yet, the
Asian region is, according to many sources, going to see the most
growth in that type of access. Singapore, Japan and Korea are leaders
in this type of access, and there is a reasonable amount of
information available about how Verizon built (and continues to build)
its FTTH network.

The reason we chose fiber as the primary method of delivery should be
obvious: speed. And if we wanted to make it in India, we had to have a
Unique Selling Point – and what better USP to have than properly fast
speed. Although the prices are still a little higher than places like
Japan, France and Finland, we hope that as we grow we’ll be able to
negotiate better rates and the costs will come down, allowing us to
pass on these savings to the users.

I discovered during my initial research that Tata and Airtel both have
got Fiber all over the city (Mumbai). I also discovered, much to my
disgust, that they seem to only want to use it for the corporate
market. Where I was living at the time, the only supplier I could get
access through was either Tata (expensive) or some cablewala (who
didn’t speak English, nor understood my poor level of Hindi). This,
despite there being Bharti Fiber less than 100m from my house, under a
big concrete slab in the footpath marked “Bharti OFC 2008″ and an
Airtel store less than 300m in the other direction.

3. One thing I’ve noticed about Hayai is that you’ve got some really awesome tariff plans. Will cost play a major role in attracting consumers or will Hayai concentrate both on quality of service and cost?

Ease of billing and quality of service are #1 equal place – going by
consumer complaints (consumercomplaints.in among other sites), billing
hassles seem to be the biggest gripe among subscribers to all internet
services. The nickel-and-diming by ISPs doesn’t help, especially since
“over-use” charges are often billed at 500-1000% markups: Rs0.80 per
megabyte might not sound a lot, but it adds up. Very quickly. To
Rs800+ per gigabyte. The cost to the ISP is not more than Rs30/GB if
that ISP is really unlucky. It’s less than that for us, so if we
charged Rs0.03 (3ps) per MB, we’d still essentially make a profit.

Of course, we don’t charge over-use because that would lead to the
aforementioned billing hassles. As such, our model is completely
pre-paid. If you run out of data, you buy more – at rates considerably
less than any of our competitors.

Overall though, we are after quite a niche market: we’re not
interested in providing speeds such as 256kbps, so starting prices for
our plans are quite above what other ISPs charge – but then again, not
that much, either. While MTNL will give you 200MB at 2mbit/s for Rs49,
we’re giving 6GB at 100mbit/s for about Rs650 including tax. For the
same amount with MTNL (once you take in to account the overuse
charges), you’d probably pay Rs3,000 (Rs0.50/MB). So customers *can*
save a lot of money by switching to our service, but only if they’re
going to use it.

On average, most of our customers have told us they are comfortable
with the Rs1,500-3,000 price range, so we can provide excellent value
at that price.

4. How do you plan to tackle low cost Government broadband service providers like MTNL, BSNL?

As described, they’re only low-cost on the surface. In addition we
just choose not to compete by providing services “way out of their
league”.

I am happy for a BSNL subscriber who only wants to spend Rs300 on his
internet and then chews the ears off the CSRs when his bill is
actually Rs370 because he used a few extra MBs. I’d rather he just
paid for a certain amount of usage and when it finishes, he buys more
much the same as he tops up his phone – hence the aforementioned
pre-paid model.

While it would be nice if we could provide unlimited 5mbit/s service
for Rs749 or whatever, it’s not economically feasible yet: to achieve
this pricing at the moment, we’d have to offer 256k services which
would defeat the purpose entirely, or the equivalent cost per GB would
have to come down by 95% or so. It might do that eventually, so we
hope that decent speeds at below Rs1000 will be available in the
future.

For now though, ideally we think we will attract subscribers who
really want, need and hopefully understand what the offering is, so
people who are currently on their 2mbit/s unlimited plans would be far
more attractive to us, as we provide 5mbit/s flat-rate service at a
smaller price than MTNL/BSNL 2mbit/s unlimited services.

Or even Airtel, Reliance and Tata for that matter. Which brings me to
Fair Usage Policies. Both myself and every consumer I’ve spoken to
hates them and we have no plans to implement them, although this all
depends on how well the Hayai Zone works and whether the average use
per customer is at a low-enough level. We very much hope that we
don’t.

As far as costs are concerned, we’re only charging for bandwidth that
goes outside the network, so if one of my customers sends a large file
to another of my customers, he won’t be charged for it – and it’ll go
at super-fast speeds, even if he is only on a 5mbit/s connection.

Because of the offering, we anticipate that word-of-mouth will work
very well for us (although it hasn’t stopped advertising plans).

5. How many states/circles are you planning to cover in India and what’s the timeline?

We’re starting in Mumbai and the surrounding areas, partly because it
always seems to be the last to get all the good offerings. The 8 and
16mbit/s connections from Airtel took about 1 year to come from Delhi
to Mumbai. I think the situation has changed a little bit now and
Mumbai even has the new 30 and 50mbit/s plans but those are sadly
expensive. The limits for those plans are 200GB and the costing is
Rs8000+. We do the same amount on our 100mbit/s data plans for about
half that price.

We’re also ready to expand fairly immediately after the service is
properly launched in to Pune and other large centres in Maharashtra,
and also Goa. Goa Telecom has built a great network all over the
state, and we’d like to take advantage of it.

We think that we will expand at a fairly rapid pace and we’re
currently hunting out and discussing with venture capitalists to help
us facilitate that on the financial side. On our proposed coverage
maps, I have most of the major centers in India planned out, and there
is talk of going to states like Orissa, where even Airtel doesn’t go,
in order to get offerings running there. Yes it’s a risk, but
ultimately we would hope that a service like ours would be received
well.

6. How are you working on the infrastructure level? Have you started recruiting?

Yes. In addition to the 2 other directors, we already have 6 people
ready to work on sales in Mumbai. I’ve also spoken to some others
ready to work in Delhi, and we’re readying our offices which will
house myself and 10-15 customer reps to start. Unfortunately it all
has to wait until I’m back in India to really take off.

7. Customer care both in terms of pre-sales and technical support can make or break any broadband service provider. How will Hayai look into providing customer service to it’s subscribers?

Phone, email, trackable support tickets on our portal. The usual. The
difference is that our phone and email reps should be competent. We’re
looking for people with aptitude for technology and diagnostics, not
those who got a diploma from one of the many fine degree-mills around
India who don’t actually know anything. They should be able to
translate from technical terms in to laymans terms as well. As such,
we’re happy to pay for the privilege of having good customer people.

8. In one line – how is Hayai different from other broadband service providers?

More bang for your buck. I think our slogan says it all: India’s
Fastest Internet.

We’re not the cheapest, but we do provide more for less. Look strictly
at the prices and some people will recoil with “that’s too expensive”
- but then they look at the alternatives, and I think that anyone who
can see value will see it fairly immediately and that at the end of
the day, in many cases we are the more economical choice as well as
the fastest.

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From all of us here at HarryJerry, we wish Mathew and Hayai Broadband all the very best!

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Tags: Broadband, hayai broadband, India, interview, tariff

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