The growth story of the Indian structured cabling industry continues to soar northward. The overall structured cabling market has grown from Rs 827 crore in FY 2006-07 to Rs 1,172.7 crore in FY 2007-08, registering a 41.8% y-o-y growth. The market in India is growing at an exponential rate both vertically and horizontally. It is registering one of the highest growth rates in the world. Undoubtedly, all this augurs well for the structured cabling market in India. The continuous growth year after year in the Indian market can be attributed to newer avenues opening for structured cabling players, explosive growth of the Indian economy, and the increased demand for bigger bandwidth for bandwidth-hungry business requirements.

In the last five years, the Indian structured cabling market has experienced a steady growth and has had an average growth of about 20% y-o-y. It is, however, important to note that since the US economy is witnessing recession at present, the growth of US-based multinational companies in India might get affected, indirectly affecting the Indian market.

Though a 41.8% growth has been registered this year, there has been a hiccup in the path of this growth story in terms of rising copper prices, as the country is still a market for UTP solutions that require a lot of copper. Raising plastic prices was another concern for the industry, thanks to the increasing petroleum prices.

The growth in the structured cabling market has been phenomenal. From a 41% y-o-y growth in FY 2005-2006 the industry recorded a 41.8% growth in FY 2007-08. STP is the dominant technology abroad, especially in Europe. However, in India, unshielded copper cabling still rules the roost, especially when it comes to regular office networks. This has reflected on the overall market performance.

The international scenario has also been quite encouraging for the industry. By 2013, the worldwide structured cabling systems market is expected to grow from Rs 61.2 crore in 2008, at a compound annual growth rate of 13.7%, to Rs 116.4 crore by 2013. The largest market is expected to be the US. The growth in the US market is expected to be fostered by the addition of new IP subnets to the enterprise's existing core networks.

On a global basis, growth in fiber cabling is expected to surpass growth in copper cabling in the next five years.

The Magic
In the Indian scenario, every structured cabling company has contributed to the journey. Tyco Electronics' AMP NetConnect (referred here as Tyco) topped the slot by achieving an estimated growth of Rs 299.52 crore in FY 2007-08, a 28% growth from Rs 234 crore in FY 2006-07. Though this growth is less than that of the last fiscal, the company's contribution is the single largest to the Rs 1,172.74 crore mark.

Much in sync with the overall market growth, which has witnessed a decline this year, Tyco has seen a decline in its growth rate this year. It has registered a 28% y-o-y growth in FY 2007-08 compared to a 42.7% y-o-y growth in FY 2006-07. Systimax CommScope clocked revenues of Rs 221 crore in FY 2007-08, registering an 18.2% growth rate.

D-Link, on the other hand, has clocked Rs 180 crore revenue in FY 2007-08 from Rs 146 crore in FY 2006-07, a 23.3% y-o-y growth. Molex has clocked Rs 98 crore in FY 2007-08, registering a 40% growth. ADC Krone has clocked Rs 52.4 crore in FY 2007-08 as compared to Rs 36 crore in FY 2006-07, a 45.6% y-o-y growth.

A noticeable and interesting trend is that the companies in the middle order continue to register higher growth rates than that of the top order ones. R&M (Reichle & De-Massari) India has registered an impressive growth of 120% in FY 2007-08 over the previous fiscal. It clocked revenues of Rs 55 crore in FY 2007-08 as against Rs 25 crore in FY 2006-07.

Nexans Cabling was not more than a single-digit company in terms of revenues in crore. On similar lines, CDT Belden has grown tremendously, from revenues of Rs 15 crore in FY 2006-07 to revenues of Rs 41 crore in FY 2007-08.

Interestingly, enterprises have realized that structured cabling solutions maintain consistency and simplify troubleshooting. This realization explains why the market has been on a growth trajectory in the last few years.

Structured cabling solutions installed with appropriate expertise and trained personnel can have a warranty of 20-25 years. That's a very long life span compared to some other backbone infrastructures. Some important verticals that heavily rely on structured cabling for horizontal and LAN requirements include IT/ITeS, BFSI, manufacturing, retail, government, and defense.

Industry Stalwarts
Tyco has been insurmountable in the last few years, and it seems the company's growth story is not going to die down. The company's key deployments are for major enterprises like Vodafone, Symantec (Veritas), Cognizant Technology Solutions, and Siemens PLM Software (UGS-Pune). Tyco has also deployed 1,200 servers for Vodafone, 1,000 for Symantec, and 900 for Cognizant Technology, and 10 G data center solutions for Siemens PLM Software.

The Vodafone order included Cat 6 cabling, MRJ21, and MPO modular plug and play solution, AMPTRAC intelligent infrastructure management, 10G shielded systems, MPO fan-out cable assemblies, and consolidation point.

The second biggest key installation for Symantec included Cat 6 cabling solution, MPO fan-out cable assemblies, and consolidation point. In the server order, the third biggest was from Cognizant Technology for which Cat 6 cabling systems, MPO solution on OM3 fiber, angled panel with colored jacks, AMPTRAC intelligent infrastructure management, and open racks with new vertical cable managers were deployed.

For Siemon PLM Software, Tyco installed 10G structured cabling solution for data center using XG copper cabling, MPO fiber backbones with redundancy, and Cat 6 structured cabling solution for data and voice.

To continue its growth in the coming years, and retain the leadership position, Tyco intends to have more focus on its partner programs, and is working toward enhancing the current ones. An important factor in this is to increase its reach in smaller cities through new alliances with system integrators, resellers, etc. In a bid to aggressively market itself in smaller cities, the company has enhanced its geographical reach by adding offices in Ahmadabad and Pune, and has forged newer alliances with system integrators in other B&C class cities.

Systimax has retained its position in the top order this year as well, clocking revenues of Rs 221 crore in FY 2007-08, an 18% increase over the last fiscal that stood at Rs 187 crore, a 19.9% y-o-y growth.

The company has launched new solutions in 2008 including CommScope Enterprise Solutions with 6A and Class EA standards. Its Systimax GigaSPEED X10D Solution exceeds the latest channel performance requirements for Cat 6A cabling. Early this year, CommScope completed the acquisition of Andrew Corporation, which, it claims, further enhances CommScope's 'last mile' offering with its end-to-end wireless solutions.

As CommScope aspires to be a global leader in structured cabling systems for business enterprise applications, it continues to be backed by strong R&D and is committed to developing its technical expertise and proprietary technology as well as its global manufacturing capability.

D-Link has scaled up its operations with an impressive growth of 23.3% with revenues for FY 2007-08 at Rs 180 crore. In the last fiscal, the growth rate was 32.7% at Rs 146 crore. Its key installations in FY 2007-08 have been for Wockhardt, ICICI-Lombard, and Durgapur Steel Plant that required 1,000-5,000 nodes.

D-Link has been able to maintain its leadership position, thanks to its unique strength-local manufacturing, providing complete solution for networking from high-end routers, layer 3 switches, DLS routers, VoIP Solutions to the entire range of information transportation systems, be it fiber medium, copper for data, video and voice, or the wireless medium. These strengths also facilitated this player to be an affordable brand for customers.