Networking industry during 2000-01 was very high on emotions. The huge growth seen in the ISP scene during the previous fiscal had a cascading effect on the moods of each and every networking equipment vendor and network integrator. They all invested heavily on teams that would focus on this high growth sector, which included the ISPs and the nascent, but developing IDCs and private telecom operators. But, when all looked good for the market, came the global technology meltdown. And, it slowly began to have a crippling effect on the equipment market and the allied services like network integration. By the end of 2000-01, most of the networking vendors and integrators had already shifted their focus and efforts on the more traditional sectors.

Also in FY 2000-01, India saw a series of visits of CEOs of multinational networking companies. Cisco’s John Chambers, Nortel’s Clarence Chandran, Sycamore’s Gururaj Desh Pande … They all said—India is a big market for them, communications infrastructure is the highway and railroad of the new economy, and that India can use its tech talent to catapult into the big league. While all this on one hand, brought confidence among the industry, on the other, things were not all right at Wall Street. Soon, companies started not living up to the investor’s expectations. As a result, their share prices crashed to record levels. Cisco, lost hundreds of billion dollars in terms of market value. Coupled with this, the news of global layoffs brought genuine fear among networking executives, no matter what words of assurance their Indian chiefs had for them.

All said, the Indian networking industry did have things to rejoice about. Banks and financial institutions acted as the perfect counterfoil to the foot-dragging telecom sector, with all the prominent names like RBI, SBI, BSE, NSE, UTI, aggressively pursuing their networking plan. And to top it all, the fiscal came to an end with a very positive budget that directed all banks to get their acts together, as far as connectivity of branches is concerned. If the banking and finance sector contributed more than one-third of last year’s networking revenue, many are of the view that it will get better this year.

Interestingly, the other sector that was really bullish during last fiscal was the IT sector. The hot trend, here, was to setup Outsourced Development Centers. Players like Cisco, Lucent, Nortel, etc, invested heavily on huge centers employing large number of people in contrast to the worldwide trend of retrenchments. Then there were startups that mushroomed both in Bangalore and in NCT of Delhi.

Also, there was an air of freshness in the industry, with the entry of players like Juniper, Extreme, Foundry, Unisphere, Sitara, Alteon (albeit in the form of Nortel) and f5. Though, during the last fiscal, they only spent time establishing relationship and doing the initial process of meeting the customers, without doing much business, these companies could this year give the established networking majors a run for their money.

Also seen were a lot of actions in the new SAN/NAS front. EMC2, Network Appliance and Legato Systems, all were here besides Sun, HP, Compaq and IBM. Even, companies like Apara focused on achieving good business from the data center space. While quite a few IDCs like Enron, Global, Satyam and Cyquator have set up their basic infrastructures, the big action on the storage space came from banking and financial institutions. The IP contact center space is yet another front where there were some good actions. Though basic in their nature, many such call center companies had set up large LANs for their agents to operate.