Growth Drivers
With cheap labor and availability of skilled engineers in India, mobile handset manufacturing for domestic consumption and export is raring to go.

Indian manufacturers need to invest a lot in T&M equipment to ensure that their products meet stringent international standards. This phenomenon has become the most important driver for growth in T&M.

Multinational vendors like Nokia and Motorola have set up manufacturing units in Tamil Nadu with strong investments. Low-cost mobile phones, base stations mainly for 2G, customer premises equipment (CPE) for WiMax for 802.16e, fixed wireless telephones for GSM, and CDMA/GSM repeaters and sub-assemblies would be the main telecom products that are expected to be produced in India in large volumes.

Existing and new R&D centres in the telecom space offer good business opportunity for protocol and RF in the upcoming wireless technologies. Business opportunities for WiMax, one-box testers for R&D on CPE, and BTS testing are expected to be on a rise. As the deployment of WiMax services begins, coverage measurement tools and network installation equipment will be high in demand in India.

Innovations in the world market revolved around WiMax/3G/LTE solutions. Mobile services are no longer going to be solely focused on voice communications, as new data-intensive applications like mobile broadband and mobile TV will be rolled out in large scale with data transmission rates getting higher and higher.

With IPTV (Internet Protocol TV) expected to be the next big thing, the broadcast sector is likely to give high growth opportunities for T&M. The broadcast sector is driving the wireline communications business, with DVB-H and IPTV being the latest trend.

End-users are more and more discerning about the quality of service and the products they subscribe. So, there is a continuous emphasis on the quality of services, deregulation, and bandwidth which become the basic growth drivers for T&M players. When you have these as basic drivers, it will pave the way for the growth of optical networks that can carry more bandwidth. And there is a lot of opportunity for T&M players.

Challenges
In India, service providers spend less than 1% on capital expenditure whereas developed countries spend more than 5% on testers. One can only hope that operators will increase their budgets for purchasing test equipment in the coming years due to the increase in subscriber base and expanding telecom networks.

As customers are demanding more integrated functionalities for their products, the challenge for the industry is to lower the cost of test at the same rate as companies are lowering the price of products.

Technology is changing rapidly around the world. Asia, in particular, is a very important technology and market driver. In India, however, the focus is on quick network expansion and bringing low-end, low-cost mobile phones to the market. Unfortunately, this is resulting in less time and money spent on testing needs of network deployment as well as quality checks on the items produced. The investments in production lines on testing equipment have been much below the expected figures. Almost all production lines in India are made operational using transferred assets from other countries, and the trend continues.

Earlier, service providers used to define what services they were going to roll out for customers, whereas today, end-users are demanding and getting what they want. For test instrument vendors, it is a challenge to design a product that ensures service providers are able to offer those services to customers. This means that test instrument companies have to work in partnership with chip companies, equipment manufacturers, and service providers.

T&M plays an important role at every phase of the product lifecycle (PLC) and is, therefore, vulnerable to the issues facing customers at every phase of the PLC. The manufacturing segment is calling for innovations to lower test costs and policies to increase the turn-around-time from T&M vendors. They are eagerly looking for solutions that can help them reach the market faster with lower cost of production and test. The key to their being competitive worldwide also lies in a faster time-to-market. The above ecosystem needs to be nurtured, protected, and well served for the overall development of these industry verticals in the country.

An Exciting Future
Utilizing the mass development of technology from telecom base stations, virtual instrumentation is quickly realizing dynamic ranges beyond traditional instrumentation. And FPGAs, which are being developed for use in digital TV, provide incredible new value to virtual instrumentation-based solutions. We are already seeing the emergence of very high performance and cost-effective solutions.

If you envision the consumer-level technology developments, which will be leveraged by virtual instrumentation, the power of design, prototype, and deployment tools, which will be placed in the hands of domain experts, indicates an exciting future.

It is expected that Metro Ethernet and WiMax will head toward massive deployment during the next four to five quarters. One of the key growth drivers in FY 2008-09 will be the wireless boom. The wireless industry is growing by leaps and bounds-from R&D to manufacturing and deployment, investment is growing across these segments. The future of wireless will be riding on 3G deployment and value added services.

On the other hand, broadband is another key segment that will help T&M to grow. The explosive growth of the infotainment industry is another area that will influence growth of the T&M market. As in the last couple of years, the coming years will continue to be well placed in the upward growth curve.

Kannan K
kannan@cybermedia.co.in