Last year's security issue affected wireless infrastructure market badly and even transmission equipment did not fare well as wireless without transmission is meaningless. Things improved in the second half due to 3G auction and subsequent 3G orders but it was not sufficient to bolster the market.
India's transmission market for FY 2010-11, estimated to be `4,896 crore, has shown a decline of 18%. The transmission figures were to the tune of `5,994 crore in FY 2009-10. The difference is due to limited purchase orders by private operators and non-finalization of large scale tenders from government operators like BSNL, MTNL, PGCIL, and RailTel.
The main drivers for transmission numbers were backbone and mobile aggregation networks to meet 3G deployment. The focus is more on higher speed equipment as they feel that with 3G, data demand will increase.
Operators launched 3G services in their respective circles but except few operators it was limited to few cities. Tata Teleservices and RCom was the first to launch 3G services. Tata Teleservices launched services in 110 cities whereas Reliance Communications was operational in 150 cities. On the other hand, Bharti is operational in 40 cities, Vodafone in 20 cities and Aircel in 40 cities. Also, 3G services were launched towards the end of 3rd quarter continuing into the 4th quarter. So, demand for data services is yet to pick up from transmission point of view as there is lot of bottleneck with respect to good quality 3G services. Once the quality of experience improves, India will see a significant increase in data traffic.
In transmission, Alcatel Lucent leads the table with 19.7% market share. The company is very active in SDH, DWDM, Carrier Ethernet and GPON. The company has got substantial share in both Tata Teleservices and RCom. Even in Bharti, Alcatel Lucent has got significant orders.
In FY 2010-11, Huawei is in the second position with 16.6% market share. The company has signed strategic deals with leading operators helping them to consolidate their position in the convergence space. The highlights were converged optical and CEN (carrier ethernet network) solutions that enable fixed-mobile convergence and help in setting up strategic infrastructure for mobile backhaul services.
ECI has done well on SDH and Metro Ethernet for cellular backbone networks. The company has got repeat orders from Bharti, Tata Teleservices, Vodafone, and others.
Ericsson has signed its largest FTTH (fiber-to-the-home) contract with Radius to connect 600,000 households and businesses with Ericsson's EDA 1500 GPON (gigabit-capable passive optical Networks) system and passive fiber portfolio. Apart from this, the company has made good inroads in 2G and 3G circles of operators where they deploy lot of transmission equipment.
NSN has been appointed by Tata Teleservices to implement part of its next phase transmission network. With this, Tata Teleservices is gearing up for the upcoming growth in data traffic and enhancing IP capabilities for its mobile backhaul network. Under the contract, NSN will supply its market-leading FlexiHybrid microwave radio to efficiently support both legacy TDM and newer IP traffic on a single platform.
Tejas Networks has performed well in the Indian market by having significant success with operators like Bharti Airtel and Aircel for upgrading their transmission network driven by 3G and data traffic. The company also supplied equipment to Bharti, Tata Communications, Tata Teleservices, MTS, RailTel, and PGCIL.
ZTE is further consolidating its position and have won a number of contracts in FY 2010-11 for 3G transmission equipments. ZTE has completed the deployment of 3G network for Aircel in Eastern UP, which is the first operator who deployed pure MPLS based PTN equipment. Based on MPLS/MPLS-TP, PTN has been developed for better support of data service than SDH/MSTP based on TDM; it combines the packet technology and SDH experience together.
Adva, a newcomer in transmission equipment focuses on DWDM, ROADM, and Carrier Ethernet. All the other players like Ciena, Fibcom, Tellabs, and UTL did contribute a lot to the overall revenue.
In the coming fiscal, the transmission market is bound to grow at 20-25% due to heavy bandwidth demand from 3G services, enterprise and home segment. All this will result in demand for transmission equipment across access, metro, and core network layers.
All the government tenders, which were initially not finalized, be it PGCIL and Railtel, will be finalized. In this fiscal, Powertel, an arm of PGCIL, is planning to expand its OFC network and plans to purchase DWDM and SDH to the tune of `140 crore. Plans are also for RailTel to buy DWDM equipment to the tune of `50 crore. Even in the BSNL-DWDM deal for increasing bandwidth capacity, UTL is L1 followed by Huawei which is L2 through Prithvi Info; the deal size is `600 crore for increasing bandwidth capacity till the rural areas.
Operators are continuing to build 3G networks for newer geographies. BWA players are yet to launch their services in different circles, thereby bringing new opportunities for transmission equipment.
National Broadband Network-be it wireless or wireline-and defence network will have significant portion of transmission equipment. All this will lead to lot many investments on transmission both in the backhaul as well as long distance network.