Advertisment

Prospects Galore

author-image
VoicenData Bureau
New Update

The network management system has been actively outsourced in India since

network complexity is becoming a growing problem, along with the shortage of

skilled IT staff. The demand for network management services has provided the

much-needed market opportunity for Indian corporates. System integrators and

hosting service providers are all getting into the act and jumping on to the

bandwagon.

Advertisment

The network management service (NMS) provides a secure architecture for

upbeat remote network monitoring and management of storage networks round the

clock. It helps maximize network availability, decrease the likelihood of

serious outages, and provide information to help optimize network performance.

Network management covers an extensive area-security, ensuring that the

network is protected from illicit users; performance, eliminating bottlenecks in

the network; and reliability, making sure the network is available to users and

responding to hardware and software malfunctions.

According to VOICE&DATA estimates, network management services grew from Rs

709 crore in FY 2006-07 to Rs 886.3 crore in 2007-08, a 20-25% jump, which is

quite healthy. HCL Comnet topped this segment registering revenues of Rs 275

crore in FY 2007-08 as compared to Rs 220 crore during the previous fiscal.

Wipro Infotech registered revenues of Rs 261.2 crore and registered a 39.9%

growth as compared to Rs 186.6 crore during the previous fiscal. Datacraft

follows Wipro Infotech with revenues of Rs 159 crore and a 33% growth.

Advertisment

Major Deals



Wipro Infotech, one of the leading players in network management services,
bagged three major deals. A major contract is from Pantaloon Retail, which has

ambitious growth plans to enhance its geographic footprint, and will increase

the number of its outlets to over 2,500 in the next five years. To support these

strategic initiatives, Pantaloon has selected Wipro for delivering streamlined

IT operations and comprehensive infrastructure management.

Wipro Infotech's other contract was with FamilyCredit, the consumer finance

organization of Societe General Consumer Finance in India, for managing its IT

infrastructure and applications management. The company's third major deal was

with Saudi Arabian Airlines to deliver next-generation IT infrastructure.

Advertisment

On the other hand, DataCraft bagged its largest deals in BFSI verticals with

companies like SBI, HSBC, and CitiBank. Other major contracts include the ones

with Genpact, and VSNL.

Growth Drivers



The Indian market currently shows a very strong trend toward outsourcing,

and it appears that the market will accelerate in the coming days and months.

Increase in centralized applications, quality of last mile connectivity, and

boom in infrastructure investment are major growth drivers of the network

management services this fiscal.

Adoption of core banking solutions, even by smaller cooperative banks, is

accelerating the requirement for network and, therefore, for network management

solutions. Besides, managing complexities of large organizations with huge and

widespread networks as well as managing users' requirements is fueling the

growth of network management services.

Advertisment

Due to e-enabling taking place across all industries to connect to the end

user, there is a considerable increase in the demand for additional bandwidth.

On the other hand, bandwidth cost has come down drastically, thus resulting in

the rapid growth of the network management system.

Wireless communication is also driving the growth of network management

services significantly. Today, most organizations are moving from fixed to

IP-based telephony. Therefore, there is a requirement for the use of network

management solutions to establish voice quality. All these developments have

acted as growth drivers for the network management market.

Advertisment

The biggest contributor to the NMS segment was BFSI including banking,

finance, securities, investment, and insurance. The other verticals that

contributed heavily to this segment were IT/ITes, FMCG, and telecom service

providers.

Roadblocks



Despite the huge growth potential, the network management services market

faced a number of challenges. Firstly, the ever-increasing complexity of

networks was a major concern because this makes monitoring network performance

and quality of service a challenge.

Secondly, security of data is becoming a crucial issue. As networks become

complex and a large number of devices get added to the network, the biggest

threat to the network is security, or the lack of it. IT managers are also

becoming security conscious and have begun demanding newer and better firewalls

and intrusion-detection systems.

Advertisment

In converged networks, the demand for network management is higher due to the

need to manage real-time traffic. Moreover, there are SLAs that are in milli-seconds,

and today's tools based on MIB polling with 5-minute intervals are too slow to

manage these types of application traffic.

Another major concern is the attitude of enterprises that are not open to

spending on network management services.

Though the network is a vital component of business and without it business

operations are susceptible, the cost of network management is higher than what

organizations would want it to be.

Advertisment

The Road Ahead



The future of the network management industry looks quite bright. There will

be a definite shift toward a multi-sourcing model for management of services.

Some core processes will still be retained through their internal teams, but

with pressure from business users demanding 100% availability, the outsourcing

boom will takeoff.

The network management services segment will see system integrators aligning

with service providers to manage networks of enterprise customers. With

globalization, as well as companies' focus on global standards, the network

management services market is bound to grow and the potential is huge and

bullish.

Arpita Prem



arpitap@cybermedia.co.in

Advertisment