The People Nearby service is a serverless communication service: you do not need to connect and authenticate to a central server in order to use it.

This kind of serverless messaging system is restricted to a local area network and an active Internet connection is not necessary.

The people that use this service inside the same local area network will be auto-discovered, and it will be possible to send them messages and files as with other services.

All the modern local area networks should be able to support this kind of service.