"Converting Voice into IP Will Be the Ultimate Conversion."

Dr Gururaj "Desh" Deshpande is a visionary and an entrepreneur ofthe New World order. He has been instrumental in starting several hi-techstart-ups like Coral Networks in 1988, Cascade Communications in 1991, andSycamore Networks in 1998, all in the US. He was in India in July this year toannounce his first Indian initiative, Tejas Networks. Voice & Data caught upwith him for an insight on convergence, technologies, and entrepreneurialspirit.

How do you view convergence that everyone is talking abouttoday?

A. One of the ways to make convergence happen is to make data pretend likevoice. You build a network for voice and then the data can move on it. Thatsuited when traffic had 90 percent voice and 10 percent data. But as databecomes the larger portion, you have to make voice pretend as data. So youconvert voice into IP. That will be the ultimate conversion, where you convertall information into IP packets and build large networks just to communicate IPtraffic.

But obviously that conversion will take some time. You needto build the infrastructure that facilitates that convergence.

What we are doing is championing the technologies to buildthe fibre-optic backbone networks, where there would be co-existence, i.e., youcan have the current existing voice networks and on top of that you can putdata. And when voice gets converted to data, then it can be more and more ofdata.

Everyone–a vendor, a user, and a service provider–looksat convergence from his own point of view. How do you see the convergence comingabout?

A. Each will be driven by different factors. For the end/home user, it isthe question of cost. For the application provider, it is the new applications,like the CRM packages. For the vendor, it is trying to support those two facets–youwant to build a network so that you can bring the cost down and it does not makesense to put two different infrastructures. Vendors will have to come up withnew applications so that voice, data, and video can go together and give you aricher experience in communications.

Several players like Lucent believe that next phase after"Internet economy" would be the "Light economy". How do youenvisage it?

A. I would like to call it a "heavy-duty economy". It is thebandwidth economy and networked economy. In such an economy, we need a lot ofbandwidth and the only way to create abundant bandwidth is optics. In the past,a lot of R&D activity was done for making the best use of whatever littlebandwidth you had. In fact, it is still happening because the world will need alot of it. And you can actually create the bandwidth using fibre optics. So youneed to go from ration model to abundance model.

Does that mean "bandwidth on the fly"? Does itreally warrant the need and how can that be made possible?

A. Look at the scene right now in India. You can get an ISP connection withmodem and DSL. It could then be wireless. All this would choke the backbone. Thefirst stage is to get a lot of capacity on the backbone for the ISPs. But assoon as you do that, you need to get all kinds of new services,videoconferencing or downloading big files. That is when you need to be able toset up "bandwidth on the fly". Ultimately, it has to be bandwidth at aphone call–you make a phone call and get gigabits of capacity.

Intelligent optical networking will help in resolving thechallenges of bandwidth. The basic thing in optical networking is that you cansend multiple lasers from a fibre. You can make one fibre look like multiplefibres. However, just taking a lot of bandwidth is not enough. That kind ofnetwork was okay when we had only phone calls. The New Networks will have tosupport a lot of new data and unpredictable traffic pattern. The new intelligentoptical networks use optical routing of signal, in addition to opticaltransmission, and deliver network services. These networks have scalability andare cost-effective.

Where exactly do the intelligent optics fit in the publicnetworks?

A. Divide the market for optic networks into three segments–the long-haulmarket (transport and switching), the metro market, and the access market.Intelligent networks will fit in all the three.

What would be the rational model for building the fibre-opticbackbone networks?

A. The old transport technology was like having a mainframe in theorganization for computing. It took lot of time, lot of planning,implementation, inflation, etc. The typical business model was you get the Rightof Way (RoW), put the fibre in the ground, and give big purchase order either toNortel or Lucent. They go and build the network for four-five years and then useit for 30 years.

The new technology is like buying a PC. You can bring thenetworks up within days. You do not buy PCs for the next 30 years, as thetechnology will get obsolete. Once you have the RoW, you lay the fibre. And onceyou have the fibre you can put something here and some there and, bang, thenetwork is up. You can bring the network up rapidly, without building the wholenetwork at one go. You can build it in steps according to usage andincrementally expand your network. The carriers need to understand this and pickthe best route. The new optical intelligent networking equipment that goes intothe New Network enable them to do just that.

Fibre in India is not used optimally. What are the broadmeasures that need to be taken to prop up the infrastructure quickly in India?

A. The only one to have access to the available fibre is DoT. So DoT needsto speed up. But being a monopoly, it can move at its own pace. Now others arelaying fibre and they have expectations to meet. And their pace should not besuch that they own the fibre in the next three years, design for two years, andbe up for another five years. They need to do things in a record time. That isthe new mindset that we need in this country. There needs to be that level ofpride. There should be a determination in the carriers to beat every record.There should be a feeling that "I am going to do it faster than he didit". We need to get the business moving.

And how do you get the business moving?

A. Through competition. You deregulate and then the opportunities areabsolutely clear. If I can swing a fibre and light it, let us say betweenBangalore and Pune, I can sell all day. So once they deregulate, people will seeopportunities. When one guy comes in and makes lot of money, the second onejumps in, then the third, and the fourth, and then the next…and there iscompetition. That’s how we need to get going.

So, the most important thing is deregulating. World over, itis a proved phenomenon that the more you deregulate, the more competitive themarket is, and the better is technology injection into the market place.

Is small beautiful or does size matter? Most companiesstart small. At that point of time they attribute flexibility and start-upmentality as the key attributes for growth and wealth creation. Then as theygrow, they consolidate through M&As. How well does that work?

A. It is not small which is beautiful, but entrepreneurial that is. So asmall entrepreneurial group is lot more powerful than a large bureaucraticgroup. But if it is a large entrepreneurial group, it is the ultimate. That iswhat we are doing at Sycamore. Tejas is an entrepreneurial group and byassociating Sycamore with Tejas, it is going to be powerful. We acquired anotherentrepreneurial group called Sirocco Systems. It is not acquisitions, but aquestion of how do you continue to work.

The reason why a lot of these acquisitions don’t work isthat you kill all the creativity and do not allow the entrepreneurial spark toignite. We want to do business with Tejas not because we want them to do thethings that we want, but because they have ideas and a mission. You need amission that is ambitious enough to accommodate a lot of those entrepreneurialactivities. Sycamore will continue to take this entrepreneurial spirit to pursuereinvention, creation, and innovation of newer technologies. So M&As are notbad, but it is only that they have to be done the right way. You have to doacquisitions out of strength, not weakness.

The entrepreneurial spirit has caught up in India. Are weon the right track and what will buoy the spirit?

A. In India, and as Indians, people are very entrepreneurial. Theentrepreneurial spirit can be easily related and explained from the cable TVexample. But what we need next is the opportunity to play the big game. I mean,you want to be entrepreneurial but you do not want to be a beedi shop–good fora little corner.

Dominating the market in a small place is not sufficient. Youneed to dominate the global market. To be able to do that, you need connections–awindow to the rest of the world. You cannot create a global leader siting inBangalore because the market in India is not leading-edge enough. In the US, itis easy because if you win the market there, then you automatically get theopportunity to capture the rest of the markets.

The association of Tejas and Sycamore is what you need togive that opportunity. This association is first of its kind, and when it works,we hope there will be hundreds of companies in such associations operating inall segments of the market. But it is very important that you have access to themost competitive and most advanced market of the world because you have to winthere.

Further, it needs to be realized that because of thecompetitive nature, there would be failures. Indians do not realize that"failure" is essential to being entrepreneurial. You fail, admit youfailed, learn from it, and move on. You fail not because you did not work hard,but the model was not right.

The fibre-optics market would see a mushrooming of manyplayers. What would be the trend and the expected numbers?

A. There are some players who get the RoW and lay the fibre, and some wholight their own fibre. Then there are those who sell the dark fibre and theylight the network for others. So the faster the market grows, the more will bethe start-ups. In the US, every week there are five start-ups. There is a lot ofactivity going all over the place.

The next thing will be consolidation. Once the consolidationhappens, a lot of technology comes over–again disruptive–which is 10 timescheaper. Then lots of start-ups get in. Therefore, consolidation and start-upswill continue to happen for a long time to come.

Worldwide, there would be 50-100 players for a long time. In terms ofstart-ups, there are thousands. And that’s what needs to happen in India. Youneed some one to say, "I would like to dominate between Bangalore and Hubli"and get the fibre up and get going. You get lot of capacity and build yourbusiness, and then build a large network. But you need to get thatentrepreneurial activity going. In revenues, the size would be in the range of$40 billion by 2004-05.

Ch. Srinivas Rao