Cisco Logo


SP360: Service Provider

india.gifI recently returned from my first ever trip to India, and experienced firsthand the juggernaut that this country has become across most of the major industries in the world. You almost can’t open a newspaper or an Internet browser these days without seeing the impact this world-changing nation continues to have. Experiencing an average of 9% GDP growth per year for the last 3 years alone, India’s quick rise to global prominence and economic influence has been fueled in large part by the phenomenon of”globalization”, or the outsourcing of well-defined business processes to fast-growing Indian IT and professional services companies. In recent years, leading companies in India have begun re-defining globalization by turning the tide, expanding out and establishing leadership positions, or acquiring companies outright, in a variety of industries previously dominated by businesses from established nations. According to KPMG, Indian companies acquired 62 companies in the first 8 months of 2005, to the tune of $1.7B, and the pace just keeps accelerating. The world’s largest steel company, Arcelor-Mittal, was created less than two years ago by the successful pursuit by an emerging markets bellwether firm of an established Western counterpart, consisting of a small group of 100+-year-old companies. And if the purchase of a Jaguar or Land Rover is in your future, you will soon be making the check out to an Indian firm, Tata Motors.India Inc.’s acquisitive bent is showing up in the IT management and telecommunications spaces as well. Wipro recently acquired Infocrossing, a U.S.-based provider of remote infrastructure management, enterprise application and business process outsourcing services, for about $600M. In very short order, the combined entity won a $275M multi-year outsourcing deal for Missouri HealthNet Division, an agency run by the state government to provide health care services to Missouri residents. Tata Communications, the newly re-branded combination of VSNL, VSNL International, Teleglobe and Tata Indicom Enterprise Business Unit, has announced it is seeking acquisitions across the globe in the managed services space, focusing on companies with technological prowess who lack the scaling capabilities to go global. While they haven’t announced any U.S.-based acquisitions yet, India-based mobile giants such as Bharti Airtel are looking toward the U.S. to add to their already mammoth number of subscribers. The growth rate of mobile subscribers in India continues to accelerate, rising to a healthy 8+ million per month and born out of the rise in the last 15 years of a robust middle class of some 300M people with money to spend on such luxuries as telecom services. Bharti Airtel is the largest mobile carrier in India, reaching 50+M subscribers by November, 2007, and continuing to add 2+M subscribers per month. Now, Bharti Airtel is adding to their numbers and expanding outside their home footprint by launching their new”Airtel CallHome” service for calls made from the U.S. to India. The service is targeted at the more than 2.5M Non-Resident Indians (NRI’s) currently living and and working in the U.S., but still with family in India. The service features single-key access dial to the customer’s ten most frequently dialed numbers at an average of 30% less cost than competitive offerings -it also includes other benefits, such as a customer referral reward program (offering free talk-time), configurable dialing for up to 50 numbers, and soon, access to other value-added services, such as astrology horoscopes, cricket scores and other services that promote connection to the customer’s Indian roots.On both the business and consumer fronts, Indian communications and outsourced IT/managed service providers will very soon be a force to be reckoned with by U.S. carriers and hosting providers. Around the globe, the telecommunications industry is going through tumultuous change as traditional wireline, cable and mobile carriers all vie to grow revenue by retaining existing customers, gaining new ones and growing ARPU through flexible and innovative new service offerings, and managing cost. All are starting from varying positions of strength, and all are moving into each other’s territories, in order to accomplish these objectives; cable providers have branched into voice, wireline providers are launching new video services, and the mobile carriers are trying to convince everyone to take their triple play on the go. Leading service providers in the U.S. are carefully following these trends and evaluating the global landscape. I would not be at all surprised if companies such as Tata Communications, Bharti Airtel and others became the world’s largest carriers in the next 10-20 years, with footprint in every major geography. These companies are incredibly innovative in their development of next-generation business and consumer telecom services, and they are nimble in their design and deployment of services because they don’t have existing infrastructure that they have to continue to”sweat” to gain the maximum ROI. They are dreaming big about what is possible, and moving quickly to design and implement new services, custom-fit to both their local customer base, and to those outside their traditional footprint.So, what do you think about the”globalization of telecommunications”? As the geographic and technology lines continue to blur, how do you think all the players across the globe will be able to compete? How will they differentiate themselves from everyone else and retain loyal subscribers?

In an effort to keep conversations fresh, Cisco Blogs closes comments after 90 days. Please visit the Cisco Blogs hub page for the latest content.

3 Comments.


  1. Nick,You are right on…India is such a country of extreme possibilities that it never fails to amaze me as to what a billion people can achieve. What we are witnessing there is the rise of consumer driven economy where the middle class (which constitutes majority of the population) is eager and anxious to taste the delicacies of the world. On the telecommunications front, Indian consumer is tech-savvy and is not afraid to experiment. I truly feel, it is time for Cisco to experiment with this market and introduce to them a world which changes the way people live, work and play where everyone constitutes a big human network :-)Attesting to that, the firms you point out have greater ambitions now and are riding the confidence wave. As multi-national companies make their foray into the Indian market, this will only stir up the local giants to adopt the innovation path and go beyond the norms. Cisco can help them achieve that dream. I am currently working some use case scenarios that may redefine competition space for these Telco’s and get them on the Cisco 3.0 path…the power of human network fuelled by Cisco’s intelligent network architecture can be a strong offering. Even today, with the Indian consumer limited by how much it uploads or downloads, there’s plethora of text based and SMS driven services floating on every mobile phone. Just imagine what may happen if the same consumer has say access to 2Mbps uplink…Thanks for the post,Nilesh

       0 likes

  2. Yeah, that’s true!!I just returmed from my first trip to india, It really suprised me to see how much an influence this country is having pn the whole world!Jack.

       0 likes

  3. Indeed-and the innovation possibilities are great –perhaps we have ourselves can learn something — being ever sooo humble…Monique

       0 likes

  1. Return to Countries/Regions
  2. Return to Home
  1. All SP360: Service Provider
  2. All Security
  3. Return to Home