The Multiplier Effect Begins

The result, along with a detailed scorecard, is finally out. According to
V&D 100—the Indian communications industry’s one and only end-to-end and
most comprehensive national survey of telecom infrastructure, and enterprise
equipment sales revenues, and communication services revenues—the total
industry size was Rs 86,715 crore in the 2003–04 fiscal. This was a growth of
18 percent over the previous year.

This mammoth survey, which spanned over months and covered about 1,000
companies, big and small, further analyses the numbers. The overall Indian
communications equipment industry went up by 14 percent to reach Rs 30,348 crore
in FY 2003–04 against Rs 26,596 crore the previous year. Within that, while
the enterprise communications equipment sales went up by 13 percent, telecom
infrastructure equipment sales took a nosedive of 34 percent. Thanks to the
great performance in GSM and CDMA handset sales, the overall growth was
positive.

Continuing with the number crunching, which is the objective of V&D 100,
the survey reveals that the communications services revenues reached Rs 56,367
crore last fiscal, which was about 20 percent more than the Rs 47,121 crore of
the previous fiscal. It would be unjust to the VOICE&DATA team, which made
this survey happen, for the ninth consecutive year, if I let everything out on
the first page itself. So just read on. I must however thank our expert advisors
and contacts in the industry for the incredible, albeit informal, support.

While V&D 100 is all about facts, figures, and analyses, the future of
Indian telecom is not going to be about these numbers alone. While the race for
numbers will continue, the coming years will also be about things like price,
quality of service, flexibility in service, personalized services, and customer
support. In other words, the future will be about value propositions.

Therefore, while investment on basic hardware for network expansion will
continue in the long journey towards a higher tele-density, telcos will start
looking at components that will make their value proposition to the users
stronger. This means, there would be investments in OSS/BSS, applications, test
& measurement equipment and services, and IT. The networks will have to get
more intelligent and adaptive. Right now, the spending on these things is just a
very tiny dot on the big telecom map.

This also means that operators will look at processes (both internal as well
as those for dealing with customers) more seriously. Right now they are almost
non-existent in our country. For instance, there are telcos which can flash an
ISO 9000 certification, but one phone call to their customer support center will
reveal how process oriented they really are.

All in all, it was a great year for communications. The same is being seen on
the IT front too. With IT and communications getting more and more
interdependent for growth, the result could be a multiplier effect. The
government needs to recognize this, and the industry needs to capitalize on
this. If that happens, growth in IT and communications will keep feeding each
other, and the multiplier effect will reach its end beneficiary too—the end
user.

Ibrahim Ahmad