Network Integrators

If 1998-99 was the year of maturing for the Networking
Integration (NI), 1999-00 turned out to be the harvest season. Riding piggyback
on the boom in the networking industry, this segment also experienced
encouraging growth last year. In a world increasingly desirous of getting
connected, there were plenty of integration projects to implement. Little wonder
that most of the top integrators in the country showed impressive growth rates.
The sole exception was HCL Comnet, which showed a negative growth.

The Business Segments

As in the network products segment, telecom, banking/finance,
manufacturing, and IT were the main business segments. Unfortunately, the
Government still seems to be slow in networking its offices and operations.
Apart from the state of Andhra Pradesh that has gone in for networking all its
district headquarters under the SWAN project, no other government really
appreciates the effectiveness of integrated and networked functioning. No
wonder, it contributed meagre 6 percent to the kitty of network integrators.

The Catalysts

A number of factors contributed to the excellent performance
of the industry last fiscal. The surge in ISPs was the primary among them. Till
date, about 300 ISP licences have been issued and 72 have already gone
operational. Others who plan to go on air soon readied their infrastructure.
Other driving factors were the e-enablement of organizations for the new
e-world; "anywhere, anytime" banking slogan by the banks; and the
pending Domestic Long Distance (DLD) policy.

India is witnessing a near frenzy for offshore outsourced
call centres ever since NASSCOM-McKinsey study proclaimed it to be the future
opportunity for India. Many entrepreneurs with money in their pockets have
either taken the plunge or are in the process of setting up a call centre. It
remains to be seen how many of them actually survive the riot, but it definitely
opened up new vistas for networking industry.

Future Projections

The DLD failed to take off last year. It is definitely on the
cards this fiscal. The ISPs are expected to move to B and C class cities and lot
of integration activities will happen in the process. The bandwidth scarcity
will help in boosting the integration and the networking market as ISPs will set
up several gateways to quench their bandwidth thirst. The opportunity is immense
and to latch on to that the integrators have to provide lots of value-additions
and offer a single-window solution.

If the carrier market for networking products opens up this
year, it will be further bonus for the integrators.

The increased role of IP in telephony means >>>>

The increased role of IP in telephony means a new type of
customer for enterprise-oriented integrators. With IP at core, the next
generation telecom networks will require routers and WAN switches apart from
fibre optic equipment like WDM. It will be indispensable for the integrators to
have enough expertise in these cutting-edge technologies.

The Top Players

There was no major shakeups among the Top 10 integrators
apart from the slide of HCL Comnet to #6 position from last year’s #2. Wipro
Infotech retained its #1 position while Siemens Public Communication Network Ltd
(SPCNL) made its maiden entry to the top club at #10. It managed to do that
solely on its ISP focus. A look at the percentage share of the Top 10 players
shows that the market is not completely dominated by them. The
"others" category holds an almost equal market share.

Wipro Infotech

• The integration business grew by 58 percent to touch Rs
  128.13 crore.

• Looking out to global markets.

Datacraft RPG

• Grew by 93 percent to garner revenues of Rs 94.45 crore.

• Plans to be more aggressive on the call centre front.

Crompton Greaves

• Grew by 94 percent and posed a turnover of Rs 68 crore.

• NIB Phase-I worth Rs 40 crore was the most important
  order last year.

• Plans are afloat to hive off the CG-Digital Group as a
  separate company this fiscal.

IBM Global Services

• Grew by 79 percent to touch revenues of Rs 63.24 crore.

• Kicked off ISP partnership programme and gained 36 ISP
  deals.

Compaq India

• Only two-year old in the NI field, it is already into the
  big league with turnover of
  
  Rs 60 crore last fiscal.

• Bagged a Rs 6.5 crore order for expanding MTNL’s ISP
  set-up.

HCL Comnet

• Shifting focus from VSAT to network implementation

• Only company in the Top 10 Club to show negative growth.

• Target segments were Defence, ISPs, and manufacturing
  companies.

CMS Computers

• Grew by an impressive 118 percent.

• Banking/finance was the major earner contributing 30
  percent of revenues.

• Projects included IDBI, Tata Finance, MTNL Mumbai, Stock
  Holding Corp. of India Ltd.

Network Solutions

• Believes structured cabling to be the key factor.

• IT sector contributed 49 percent of its revenues.

Tata Infotech

• Focussing on finance and carrier segments.

• Major orders included WAN backbone for Railways Freight
  Operation Information System and RAILNET Phase II, integration of 228
  branches of the Union Bank of India, etc.

SPCNL

• Targeted niche segments of ISPs, IP/ATM backbones, ISP gateways, etc.

Click For 1998-99 Performance of Network
Integrators