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OXIO wants to use the blockchain to make “Telecom-as-a-Service” as common as SaaS.
To that end, the New York-based startup announces a $ 12 million Series A funding round on Tuesday, led by Brazilian monashees VC and Atlantico Capital, with the participation of FinTech Collective and Multicoin Capital. Brings the company’s total fundraising to $ 20 million by the end of 2019.
OXIO allows big brands to offer telco-like services by transforming mobile data into a negotiable digital asset using blockchain tokens. Tokenized data packets will be especially useful in emerging markets like Mexico, where mobile internet is relatively expensive, the company says.
The big picture for OXIO is the reboot of the virtual mobile network operator (MVNO) model (UK-based Virgin was a well-known exponent of this original trend). It’s not a completely new idea: Hong Kong-based DENT Wireless, supported by Samsung Blockchain, also offers a token to promote mobile data exchange.
OXIO allows companies to leverage the best local telecommunications or satellite infrastructure through an API. Plus, according to OXIO co-founder and CEO Nicolas Girard, it opens the door to much more in terms of service differentiation, rather than simply offering a branded version of the Internet or WiFi of the host.
“It’s not about becoming a telecom company and delivering exactly what Verizon and others have done, and more about the brands that add their own spin as they get closer to their customers,” Girard said. “So if a brand becomes a mobile operator, it can differentiate itself and offer plans that connect to what it does as a business, be it e-commerce, retail or gig economy.”
Mobile data tokens
Wireless data is a $ 2.5 trillion industry and yet there is no obvious way to trade it, Girard said. This is where the blockchain comes into play; it’s just a component, but an important part of the vision, he said.
OXIO has been testing using the Stellar blockchain and most recently is testing the Near protocol supported by Solana and Andreessen Horowitz, Girard added.
“The best way to think about the role of blockchain is around a wireless data token, then leverage wireless as an asset class,” Girard said. “You have never traded wireless because there is no tool to deal with it.”
Read more: Ocean v3 brings the wave of data monetization tools to Ethereum
Wireless data varies in cost and coverage by country and also by technology, such as WiFi in hotel rooms or on the plane. In Mexico, for example, where mobile users consume just over 2GB per month (the average US user consumes 2.5 times), mobile data costs around $ 4.77 per 1GB. This places Mexico in 158th place in the world in terms of convenience.
This is why OXIO has embarked on pilot programs with some of Mexico’s largest companies in retail, convenience stores, food and beverage stores, and pharmacies, Girard said.
“The big picture is we’re trying to build the first global network as a resource,” Girard said. “So we’re saying wireless can be a negotiable asset and in order to achieve global adoption of that network, there can be a token that represents that fungible wireless data.”
As in classic crypto-economic theory, the tokenization of mobile data could help align the interests of different stakeholders, Girard said.
Looking ahead, blockchain may also play a role in how the “gold mine” of accumulated user data can be managed in a way that protects customer privacy while mining the value of that data, he said. (The Ocean project took this idea of monetizing data further into the blockchain world, using the concept of decentralized data markets.)
“If you are creating new business models to subsidize connectivity, this basically means that the user can pay with money or with data. And this is where blockchain comes in,” Girard said.
