Indian Railways is emerging as a Hub of Innovation for Service Providers

Indian Railways operates at a staggering scale in every fathomable dimension. It moves 23 million passengers and 3 million tonnes of freight every day, deploying more than 12,000 trains across 115,000 km and some 7,000 stations.

But as the country’s largest employer starts digitising parts of its services operations, it’s beginning to acquire huge scale in an emerging dimension — data. The network gathers some 100 terabytes of consumer data annually (one terabyte is sufficient to store 500-1,000 movies). Its passenger booking platform has 25 million users, who make some 800,000 daily transactions. This kind of digital scale is making the railways ecosystem a fertile ground for entrepreneurs, innovators and those looking to deploy and test technologies at a large scale. And while the railways has made a good start in collaborating with third parties, a lot more needs to be done before companies can build a seamless experience in bookings, payments and other services on top of the railways data pipeline.

For the better part of three years, the founders of Confirmtkt, a startup focused initially on helping passengers check the odds of snagging a confirmation on this vast network, didn’t monetise their business. Instead, they focused on building out their user base, providing a single use case, checking PNR status for tickets, reaching the 500,000 user milestone in March 2018. Then the firm pivoted, by beginning to mine this user base to charge users to find their way, negotiating a labyrinth of seat allotments, discounts and quotas [68 in total] to aid their passage. That business has gained strong traction, with user base growing to three million, with ambitious projections to cross nine million in 12 months. According to some industry estimates, some 50,000 tickets daily are booked on the paytm app, around 15,000 to 20,000 on Ixigo/ Ibibo and Confirmtkt does around 8,000 to 10,000.

This means that users can negotiate the myriad combinations of trains and stations to find their way. For example, if a user needs to travel from Bengaluru to Hyderabad, but find no reserved seats, they try to instead book to Warangal [the next stop] and get off at Hyderabad.

Over the past few years, Indian Railways has become more open to let such innovation flourish on their networks and premises, from startups such as ConfirmTkt and Trainman to giants such as Google. “We have gone from providing a cute utility to building a viable business with an actual revenue model,” says Sripad Vaidya, COO and cofounder of Confirmtkt. “The sheer size of the market and limited knowledge of travelers makes this a scalable business.”

In Google’s case, its most visible project has been to provide free wireless internet access across hundreds of stations under the G Station project. Over 400 stations, starting with Mumbai Central, have been covered in the past four years, with users consuming an average of 300 mb per session, per Google estimates.

The company claims this boost to public WiFi usage would have added 40 million incremental users and a $20 billion impact on GDP. “The public WiFi project is a shining example of how public and private partnership can deliver a world class service to the citizens,” says K Suri, who heads partnerships for Google’s Next Billion Users initiative in India. Among startups, Google’s actions are closely watched; in December 2018, it acquired Sigmoid Labs, the operator of the Where’s my Train app (with 10 million users), for an undisclosed sum (estimated by the industry to have been in the $40 million ballpark).