ENTERPRISE CONNECTIVITY: The Spotlight Shifts

I t is gradually dawning on Indian telecom service providers that voice
services alone may not be enough to fill up coffers in the future. Hence,
service providers are increasingly looking at more layers of services primarily
focused at the enterprises. The bigger conglomerates like Tata, Reliance, Bharti,
and the incumbent operators BSNL/MTNL are at the helm of this enterprise focus.

Though the service providers’ focus on enterprises involves voice, the
thrust would be on a host of data services. Telecom analysts argue that this is
not unique to India. In most Southeast Asian countries as well, with falling
voice ARPUs, service providers increasingly rely on data services to bolster
their bottomlines. Within the gamut of data services, IP-VPN seems to be the
flavor of the day as it gradually replaces the more expensive frame relay or ATM
VPN services. For Tata, this required minimum effort because the acquisition of
VSNL enabled it to get onboard VSNL’s customer base, which had been using
these data services. However, it would be a fallacy to think that the enterprise
focus of these service providers is limited to IP-VPN services only. In most
cases, it extends to a host of innovative applications such as sales-force
automation, point-of-sale (PoS) terminals, and Wi-Fi usage. Even good, old voice
is being sold in bulk to the corporates, so they don’t have to bother about
pesky billing issues. This has also made a positive impact on the bottomlines of
the service provider.

Tata Leverages on VSNL

Tata’s enterprise focus has been channelized through TIEBU, the marketing arm
for a host of telecom service providers from the Tata group. It caters solely to
the enterprise segment. VPN is important, however, other services include
bandwidth management, hosting services, ADSL and DSL connections plus VSAT
usage, IPLC, and corporate Internet ISDN–most of these coming from the VSNL
stable. TIEBU already has nearly 450 accounts from the enterprise market and has
completed business close to Rs. 600 crore. The group has customers in most
verticals–automotive, pharmaceutical, hotels, travel, transport, and TV
broadcasters.

Tata Indicom has tied up with group company Tata Infotech for research on
wireless applications, the research being conducted at IIT Mumbai. Tata
Teleservices is in the Wi-Fi space, providing total Wi-Fi solutions for
corporates and establishments who want wireless Internet access. A number of
leading hospitality enterprises like the Taj Hotels in Mumbai and the Barista
outlets are customers of Wi-Fi services.

Tata Indicom is also catering to the growing bandwidth demand from IT and
ITeS companies, whose telecom expenditure accounts for nearly 10 percent of
their annual turnover. This is mainly because these businesses require
ever-increasing bandwidth for communicating with their counterparts all over the
world. The integrated enterprise solution from Tata Indicom provides the
customers with services ranging from solution architecture to product manager,
customer relations and business support to billing and collection.

In the last three years, the bandwidth-demand growth rate of IT and ITeS
companies has increased by 100 percent. TIEBU was conceptualized to meet the
growing needs of these businesses, providing them value-added services and
better value for money. The Tata Group is catering to the demands of these
bandwidth-hungry companies in a three-tier approach. VSNL’s 3100 km. Chennai-Singapore
cable, with a capacity of 5.12 terabytes, is a move towards providing a better
international connectivity to the IT and ITeS companies. On the domestic front,
the NLD is being enhanced and expanded to different regions across the country.
Through TIEBU, Tata Group is offering customized telecom solutions for these
companies, enabling them to optimize the utilization of their telecom
infrastructure. Focusing on optimization, Tata Indicom has offered a series of
new products and service enhancements which include services such as VSNL’s
international ATM/MPLS services, managed voice minutes, and domestic ATM
services. These solutions would enable the companies to get rid of fixed costs
and switchover to the variable-cost options. For example, ‘managed voice
minutes’ will particularly benefit companies which do not have a stable
calling schedule and evaluate costs for the period when data was communicated.

Last but not the least, TIEBU has entered into a strategic alliance with Tata
Telecom for co-marketing Tata Telecom’s end-to-end converged communications
products and solutions. As part of the alliance, TIEBU and Tata Telecom would
offer a wide range of converged-communications solutions. These include IP
telephony solutions, contact center solutions, videoconferencing solutions, and
data-networking solutions. The synergistic alliance helps enterprises deploy
end-to-end triple play (voice, data, and video) solutions to enable improvements
in business performance through productivity enhancement, network integration,
increased flexibility and scalability, and customized applications.

But Bharti Steals the Thunder

Bharti is clubbing its mobile applications for enterprises under its M-Business
solutions. Though it has experimented with a number of pilot applications, the
biggest GSM service provider of the country is yet to rollout these services in
full earnest. However, it expects to tap nearly Rs.1,000 crore worth of business
from this market. The M-Business solutions include vehicle tracking, mobile
sales-field automation, telecom audit tool, intelligent routing, and information
broadcast–all targeted at the corporate customers. Some of its solutions are:
Always On, AirTel Yellow Pages, Virtual Private Network, and Indiaone MeetXpress.
The company claims that the top five consulting firms in India are phasing out
their hotline infrastructure to use its services.

One of its applications is vehicle tracking, which Bharti has implemented for
a Bangalore-based company. After implementation, the company can locate its
stock in transit with the help of Airtel mobile phones fitted on to the
vehicles. The phones are not fitted with the ordinary SIM cards that an ordinary
Airtel retail subscriber uses but with vehicle-tracking-enabled SIM cards that
send periodic updates on the location of the phone (and the vehicle to which
they are attached) to a central application server. The movement of the vehicle
is shown on a map from which the company can simultaneously track all its
vehicles. In remote areas, where Bharti may not have its mobile networks, it
uses a global positioning system (GPS) box instead of mobile phones.

Bharti has also implemented a sales-field automation project for another
client. Here, the customer’s Web-based applications and ERP systems are put on
a wireless platform so that the field force of the company can have access to
the information through their Airtel connections. The telecom audit tool,
another application launched by Bharti, helps the customer as well as the
operator to jointly analyze the telecom expenses and usage patterns and pinpoint
the areas where costs can be saved. The analysis can then be used to identify
the optimum tariff plans.

Airtel also provides a routing solution where calls made by corporate
employees can take the least-cost path. For example, cellular-to-cellular
long-distance calls being cheaper, employees could simply a prefix a digit to
the phone number being dialed and access the GSM interface on their board line,
if they were to dial a cellular phone from their office. This would save an
office the costlier landline-to-mobile calls. Bharti says it is open to
suggestions for more services. One such service could be customized SIM cards
for corporates. Only particular user groups within a corporation would use the
phones running these SIM cards thereby creating a kind of virtual private
network.

Not to Forget Reliance

Reliance has envisaged for itself a sound business strategy whereby it could
leverage different mobile applications to garner a large share of the rising
data ARPU pie. Reliance is aiming to emerge as a leading ISP through its R
Connect business. Reliance also offers a host of innovative applications to
entice enterprises.

Two crucial applications come from its wireless stable–one is the wireless
credit card point of sale (PoS) terminals and the other is the wireless mobile
automated teller machine. Reliance has offered its wireless network to different
banks so they may set up PoS terminals–devices that read a credit/debit card
and obtain authorization from the user’s bank–in remote locations. Ditto for
setting up wireless mobile automated teller machines in remote locations.
Enterprises can access services such as these by using Reliance’s fixed
wireless terminal (FWT) device to connect their PBX networks and data
applications. This is a low-cost option for countrywide deployment of
applications like connectivity to automated teller machines, PoS connectivity,
headquarters-branch connectivity, CRM applications, and travel reservations
applications.

ICICI Bank has one wireless ATM in Kochi and two in Mumbai, both running on
Reliance’s CDMA technology. An ICICI mobile ATM was also deployed outside the
Wankhede Stadium during the India-Australia one-day cricket match. For PoS,
Hindustan Lever and Reliance are collaborating on a pilot project with HLL’s
home delivery boys. A few petrol pumps on the Mumbai-Pune expressway and another
inside the Dhirubhai Ambani Knowledge City in Navi Mumbai are also using mobile
PoS terminals.

Reliance has scored a major success on the online lottery front, by providing
connectivity to more than 2,500 terminals of nearly all the online lottery
operators. It has also provided connectivity to about 250 static terminals
belonging to Sugal & Damani, one of India’s oldest lottery companies.
Sugal & Damani is planning to install more than 1,500 such terminals this
year across the country. These terminals would be called Compllot, and it plans
to scale up to 2005 terminals by March 2005. Reliance has also sold 2000 FWTs to
Dhoot Entertainment Network, which conducts the V-1 online lottery operations.
Already 75 percent of Dhoot’s online lottery machines are connected through
CDMA technology from the Reliance platform.

Like Bharti, Reliance has offerings on sales-force automation and vehicle
tracking fronts too. Large organizations with large supply and distribution
chains, till now, were connecting to their stockists and re-distribution network
through the Internet. However, mobile Intranet through Reliance not only
provides a cheaper option, it also makes the supply chain more efficient.
Hindusthan Lever is currently conducting a pilot with Reliance on this aspect
too. And, a vehicle tracking system has been deployed at Reliance’s refineries
in Gujarat.

Reliance’s has another unique offering, the Tally Data Phone. It creates a
VPN for users of Tally, India’s largest selling accounting software (which in
turn claims that it sells more than all the other accounting packages in the
market put together). Tally Online, the online accounting software service from
Tally, would be available automatically through the Tally Data Phone to
different users who may be connected through a VPN, all using Tally. The phones
work on 3G CDMA 1x networks.

Incumbents: The Dark Horses

The two PSU telecom service providers BSNL and MTNL have formed a strategic
alliance to jointly offer enterprise solutions to corporates. Together, they
make the single largest telecom entity of the country offering voice and data
services across the country. The joint entity would provide multi protocol label
switching (MPLS) based VPN services to corporates like ICICI, ONGC, State Bank
of India, Bombay Stock Exchange, and Central Bank of India. For enterprises,
BSNL provides leased lines for voice and data communication for various
applications on a point-to-point basis. It offers a choice of high- medium- and
low-speed leased data circuits as well as dial-up connections. It has enough
capacity to offer bandwidth on demand in most cities.

Managed leased line network (MLLN) offers flexibility of providing circuits
with speeds of nx64 kbps to 2 mbps, useful for Internet leased lines and
international principle leased circuits (IPLCs). Under the Sanchar Sagar
Project, BSNL has plans for providing broadband access network for corporate
customers in cities like Hyderabad, Bangalore, Chennai, Kolkata, and Pune.
Coupled with this access network could be the new dense wavelength division
multiplexing (DWDM) transmission network, which could greatly benefit corporate
customers. With most of the private players still hesitating to come out with a
full blueprint for enterprise services with a sound revenue model, BSNL/MTNL
might have the last laugh in this market roughly estimated to be around Rs 5,000
crore.

Rajneesh De