T&M

Sales to utilities and an increasing focus on the

service sector, was the highlight.

align="left" hspace="4" vspace="4">State of

the Market

As non-telecom entities like the

utilities getting into communications, we have taken into account sales of all the

communications-related T&M equipment, and not just sales to the telecom industry. That

means a spectrum analyser sold to Indian Army or an OTDR sold to the Indian Railways are

now part of our estimates.

Market Size

The total market size for

communication T&M products and services is estimated to be Rs 212 crore in 1998-99.

Lack of any reliable break-up makes it difficult to estimate how much was sold to

communications service providers, turnkey network builders, and manufacturers. However,

roughly it could be anywhere between Rs 145 crore to Rs 160 crore. Which means there has

virtually been no growth in these sales. The 1997-98 figure, as estimated by Voice

& Data stood at Rs 146 crore.

What Sold?

Traditional generic communication

T&M equipment like spectrum analysers and signal analysers accounted for the maximum

share of the Rs 212 crore market with about 20-23 percent of sales in terms of value.

Surprisingly, this was followed by the sales of general measuring instruments, always

thought to be low-value items. The percentage of these sales to the total market size,

however, is difficult to estimate. The single largest growth in sales, both in units and

value, was witnessed by OTDRs, thanks to the bulk buying by the DoT and the utilities.

Another surprising finding is that the sales of specialised test sets like GSM test sets

actually dropped.

Who Bought?

The year 1998-99 saw a seesaw

movement of the buyers. While the sales to utilities and turnkey contractors went up,

sales to defence suffered because of the US sanctions.

Within the telecom industry, the

sales to value-added service providers like cellular operators and paging operators

virtually reached its nadir. This was to some extent compensated by the purchases from the

DoT, as it kept expanding its network. Interestingly, only VSAT service providers among

private operators bought T&M equipment, though the value of those sales was very small

compared to the overall market size.

Who Sold?

The highly fragmented market

suffered the pressure of slowdown in the buying by private operators. So, as it invariably

happens in case of slowdowns, the leaders did better. Hewlett-Packard India emerged on the

top once again with a 27.6 percent marketshare, followed by Tektronix with a 10.9 percent

marketshare.

Trends

• As outlined in last year’s V&D 100,
  
  the sales to utilities went up.
• T&M is increasingly moving from being a
  
  product-driven industry to a service-driven industry. While box selling gave way to
  
  solutions selling, services became an important part of the total T&M sales.
• Outsourcing by telcos started in a big way when
  
  Tata Teleservices placed an order worth Rs 3.2 crore on Hewlett-Packard for supplying
  
  equipment and maintaining network quality for the next five years.
• The Wireless Planning & Coordination (WPC)
  
  wing also went for a trend-setting tender inviting T&M companies to totally integrate
  
  a mobile van with required T&M solutions for monitoring conformance to frequency
  
  allocation by RF users. Incidentally, this order was also placed on Hewlett-Packard.

Forecast

• Utilities buying will continue to grow. So will
  
  the buying by the turnkey providers.
• For T&M suppliers, testing and quality-related
  
  services is a new opportunity. While total outsourcing by telcos and training and
  
  consultancy orders could land up with only big T&M vendors, for medium and small
  
  T&M companies the opportunity is in network audit.
• This year, by all probability, the market will
  
  grow by about 15-20 percent. This is in comparison to 1997-98 and 1998-99, when this
  
  segment registered single digit growth.