Network Integration : The Time is Now

Networks are getting complex day-by-day, growing both in terms of number of

connects and bandwidth capacity per connect. The pressure is on reducing costs

in these tough times and to excel is making organizations search for innovative

ways of designing, building and managing networks.

Newer networking technologies and applications are driving organizations to

deploy networks of a scale and complexity never seen before. Government-led

initiatives like the state WANs and state data centers (both under the

e-governance plan), de-regularization of the insurance industry, large network

roll-outs by the banking, insurance and financial services industry, etc, are

other factors leading to new avenues of growth for the network integration

industry.

Key Trends



The hottest trend in the network integration industry is network

convergence, ie, carrying voice, video and data together on the same network and

integrating it with wireless technologies for mobility. This requires a lot of

integration and communications between different services and applications in

order to work seamlessly. Convergence and mobility are the biggest issues to be

tackled in the network integration space today.

The other big area is making networks ready for virtualization and

consolidation. Applications and server hardware are gearing up to tackle

multiple services consolidating the environment, to reduce the infrastructure

and its underlying cost. Virtualization technologies on network equipment with

high throughputs and capacity like NEXUS, is the answer. Adoption has to happen

fast to keep pace with the consolidation and virtualization drive.

The third area that continues to gain momentum is the overall network

security. The importance of security, whether it is from the compliance

standpoint or to mitigate risk, is gaining importance as companies build up

their IT departments. As network IT becomes more strategic to business everyone

wants to ensure that it is a secured environment where they can mitigate as much

risks as possible. Hence, security that is reliable is crucial.

Cost optimization is also a crucial area for the network integration space as

customers are looking for ways to reap benefits from investments done in their

network infrastructure. They are looking for ways to find solutions for current

business challenges with marginal increase in capex for infrastructure.

On the Go



The network integration industry has shown significant growth over the past

years as enterprises and the government have realized the benefits of creating a

centralized, high end networking platform to power up varied applications being

used by different functional groups.

Over the past years, various technologies have matured and are now available

for enterprise deployment. Most of these technologies allow enterprises to

increase employee productivity and reduce their overall costs. India is emerging

as one of the most lucrative markets for such technologies given the phenomenal

growth of applications such as e-learning, tele-medicine, and e-governance.

Innovative technologies like wireless, tele-presence and unified communications

have been the key technologies in the market this year.

Moreover, virtualization and storage are changing the landscape of data

centers and in turn pushing OEMs for a more complete and collaborative solution

in the data center space. This forces the designers to look beyond networks.

Experts panel

Prem Nithin, senior technical consultant, Cisco, India & SAARC Sanjay Virnave, president, sales, Tulip Telecom Gurpreet Singh Kohli , head, global networks practice, HCL Comnet Jayesh H Kotak, VP, product management, D-Link India Murtaza Bhatia , national manager, professional service security, iBoss Vikas Srivastava, general manager, EPD & TIS Business, Wipro Infotech Alamuri Sitaramaiah, GM sales, Fluke Networks India

Forward thinking companies are moving toward a vision in which business and

IT strategy and architecture align. Building upon its existing network

foundation, an organization can pursue an enterprise architecture strategy that

enables it to rapidly add innovation to business models and processes. Instead

of spending time and money integrating single applications, they can link

standardized infrastructure and applications components for use across different

departments and divisions.

By adopting such a deliberate approach towards managing and enabling change,

organizations can drive agility and efficiency not by optimizing around one

specific business model, but by adapting quickly to evolving competitive

solutions and thereby accelerating business value across the entire company.

Surging Ahead



The BFSI sector is driving the growth for network integrators. But with all

major industry houses entering the retail business, it is becoming a lucrative

segment wherein the very format of operations requires creating physical

establishment which in turn needs to be connected. So the retail industry is

also drumming up a lot of interest.

The other emerging verticals showing growth opportunities include government.

NeGP on government's agenda on e-governance will be a big business opportunity

for all possible network integrators. As large PSU banks get into their third

and fourth phases of network rollouts, we see a lot of rural branch connectivity

projects being rolled out accelerating the demand of network integration

services in the banking sector.

Telecom service providers-migrating to IP and buckling under increased cost

pressure-is the other prominent vertical. SEZs, manufacturing, airports/ports

and healthcare will also boost network integration.

CIOs are aware that the new generation of workforce expects to work in an

environment driven by technology, its adoption and usage. Hence, they are

pushing IT to give their employees the same kind of personalized services. CIOs

understand that with collaboration comes increase in the levels of innovation,

and in this second phase of innovation, they know investing in the network can

help deliver all forms of communications, ushering in new innovations to drive

business further.

CIOs today are more of business leaders than technocrats. They are constantly

looking for avenues where the right and innovative use of technology might offer

an organizational edge in the marketplace. In this line they are engaging with

service providers at a much higher level in the value chain. They want their

service providers to think of benefits for end users and to continuously analyze

their set up, build the knowledge base and come back with suggestions for

optimizations.

CIOs look for value for the money spent. The test for CIOs today is to

address business challenges with a marginal increase in their network

infrastructure capex; at the same time getting good returns in terms of cost

savings.

2008 has seen a lot of fluctuations with respect to pricing. One key impact

has been value of the dollar going up from below Rs 40 to approximately Rs

48-translating to a 20% increase in cost. Customers have strongly objected to

any price increase and at the same time are quick to expect immediate price

benefit of any cost reductions like excise duty cuts. Crunching budgets and

projects on hold will be the scenario at least in this quarter and probably the

next quarters as well.

The economic downturn has indeed forced everyone to re-think their

strategies, and naturally, the need for service providers is to move up the

value chain and quality levels. Budgetary constraints and competition have

forced the industry to drive down costs. Enterprises are asking for lower levels

of integration pricing. The concept of end-to-end solutions or one-stop

solutions has gained momentum. Bandwidth prices have also come down

considerably, and device functionalities are increasing disproportionately to

price.

The Way Forward



At a time when every organization is caught up in the effects of the

economic downturn, the question on everybody's mind is what strategies to adopt

to best beat the recession blues. IT analysts representing the industry are only

too aware of the role that a mature and agile IT set up will play to drive

business and fuel growth.

To tighten their purse strings, some clear cut expectations that they have

includes a business resilience and adaptability driven approach. And models that

will protect their investments while ensuring up-to-date technology. Though the

recession might be hitting the Indian shores more psychologically than in

reality, organizations in such a situation become more prudent in their spending

and opt more effective measures. This means business for network integrators.

Innovative thinking in managed services is going to be the way ahead. The

industry would undoubtedly seek ways that will help permeate scalability and

flexibility to adapt to both lean and growth periods. Organization will expect a

lot of changes in the way business is done. There would be change in the

business model service partners operate on, to give maximum benefit to the

customer without compromising on quality. Organizations that adapt to these

changes will thrive during the recession.

Arpita Prem



arpitap@cybermedia.co.in