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Pardon the cliche, but it could very well be party time for Indian enterprise networking businesses. After all, for the first time in the history of enterprise networking, Indian enterprises invested more than a billion dollars in building new networks and enhancing the existing ones. The enterprise networking market reached Rs 5433 crore in sales, in 2003–04. For those defining success in dollars, it amounts to $1.17 billion. Even though this translates into only a 15 percent growth over the previous year, the industry should be applauded for crossing the billion-dollar milestone. Enterprises switches, network security products, routers, structured cabling, VSATs, network storage, IP telephony and wireless were among the key networking segments that contributed to the growth of the market. The leading network integrators' focus on services also resulted in a significant contribution from that segment. Also significant is the fact that there was a growing acceptance of advanced technologies in areas like IP telephony, network security, wireless, and networked storage enterprises across the verticals.

V&D estimates CyberMedia Research

Like in the previous year, the banking and financial services industry (BFSI) was the biggest buyer of networking products and services. The BFSI segment along with the other key segment, BPO-ITES, contributed almost 50 percent of the market. Companies in these segments were possibly the best performers among verticals, as far as the networking vendors were concerned. They made a lot of investment in expansion of their networking infrastructure, in order to meet the requirements of a growing business as well as building up disaster recovery and backup sites. There was no definite buying pattern among BPO-ITES customers but whenever they got a big deal or a new large customer, it meant more business for networking vendors. Government, including the defence organizations, and manufacturing companies were the other key contributors.

Among the vendors, Cisco reigned supreme in the data-networking segment with around 36 percent market share. D-Link and Enterasys were the other key vendors in these segments. Besides them, two commendable performances in 2003–04 were from 3Com and Nortel. After almost being in oblivion in the previous year, 3Com regained some of its lost ground in 2003–04. Most of its business came from large enterprises and from two product lines-Gigabit LAN Core Switch and the newly introduced routers. On the other hand, Nortel was more aggressive last year then it had been earlier. It made a lot of effort to increase its presence in the SME segment and strengthened its resellers and partner base.

V&D estimates CyberMedia Research

Ravi Shekhar Pandey