For Tulip, core business is going to be connectivity'

Your association with Tulip has been quite long as CFO, and now as the CEO, how do you see your profile changing in the company? What are your immediate focus areas?

When I was the CFO, I was more of a strategy oriented head rather than a control oriented official. My association with the business was very close, therefore it has not been a difficult migration as I was always very actively participating in the growth, and execution of processes. As a CFO, you have a role of making suggestions on sales and operations, but when you are a CEO, you have to see that overall things are going well, and not only the financial execution. As a CEO, you no longer stand as a consultant only.

In terms of immediate focus I would say, there is immense opportunity in the market. We are seeing Indian companies not only contributing in the country's growth story, but also making international headway. We see good opportunities for Tulip. The key is execution-making the most out of the opportunity. We have been an Enterprise Data Connectivity (EDC) company, and we realize that we need to dovetail the connectivity with more solutions. Thus, we need to evolve from Enterprise Data Connectivity (EDC) to Enterprise Data services (EDS) as a company.

How big an opportunity is enterprise VAS for Tulip in India? What kind of investments are we expecting to see in this space?

For Tulip, core business is going to be connectivity. We are going to build solutions and products around it. We are already in the data center space, and will further grow it manifold. We would like to attempt combinations of connectivity and data centers as they gel very well. We would like to start offering managed services like unified communications, including video conferencing services. In data centers, we are not going to be just selling rack space, we will be able to offer hosted services again a combination of services with connectivity-this is how we are going to align ourselves to the growing needs of enterprises in India. We really don't need to plan big investments to make all this happen. I think the run rate of investments that we have been doing, should be good enough to enable us to do so. We have been investing about Rs 450-500 crore every year, and plan to make similar investments this year as well. It is our strength that we have been building up on over the past few years. The customer is looking for outsourcing conferencing solutions, domain and web hosting, network security, network installation and maintenance, and data backup. This will be done through a combination of both in-house solution development and active partnerships.

The company's recent deal with Qualcomm is likely to give a consumer focus touch to its profile. How do you plan to leverage this association with Qualcomm?

Tulip has been a B2B company, will continue to be so. We believe that 3G and BWA rollouts will be a B2C game plan largely, and there is a good potential in the areas of these rollouts. We believe some very small enterprises may fall in that gambit of B2C areas, where these opportunities will be aimed at. So, the partnership is aimed at strengthening Tulip as a global company and leverage the benefits out of the domestic market growth curve. However, it does not mean Tulip is going into B2C space. This is like putting your eggs in a basket which we expect to grow, but it should not really interplay or overlap with B2B growth expectation that we have.

What is your technology focus going to be for the next two-three years? Post your association with Qualcomm are we likely to see major share of your investments flowing towards WiMax and LTE?

Our focus is enterprise business, and technologies like BWA, LTE are going to see more of B2C interplay. We will continue to make investments in RF and fiber cables, so that we are well-equipped to meet the demand of the customers on data. The investments in fiber are going to be in the city rather than intercity. When I talk about EDS, we have to consider all four aspects-data centers, managed services, unified communications, and connectivity which is biggest here, almost two-third of the market size. We don't only lay fiber-we outsource and lay it for network-so significant part of the investment will be in fiber and the balance will also be in RF network and upgradation.

Tulip has been performing pretty decently over the last two quarters. What do you expect the fiscal growth to be like?

We should maintain the momentum that we have been witnessing over last couple of quarters. We believe Tulip should be able to grow around 20% y-o-y.

In today's IT milieu, we see the thin demarcation between a vendor and a partner blurring. How do you view this change in the Indian IT space?

I will not like to use the word vendor now. I would rather say partner, especially when we discuss the road map for Tulip, partnership will play a critical role. Vendor probably is a term of the past.

Across your offering profile, telecommunications is a major contributor. How lucrative and competitive is this space getting for Tulip? What will be your strategy to harvest higher returns from this segment?

Telcos like Bharti, Reliance, and Tatas are set to roll out their 3G networks. They will be focusing more and more on the value added services for their cellular customers that will require hosting services. So, we see telecom companies as major customers for us. Somewhere the telcos are also offering enterprise data services, though we have the largest market share in the MPLS space, these companies are offering that as well. If they want to grow their business, our networks and reach are always open to them as a offering. Telecom is going to be a key vertical driving data service demand forward.

Heena Jhingan
heenaj@cybermedia.co.in