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Growth wasn't the only story of 2004–05. Indian enterprise networking market witnessed a number of other changes as well. Enterprises began to look at networking as a strategic investment and networking and communications now appeared on many a CEO's agenda. This was also reflected in the increasing size and complexity of the networking deals. The complexity of deals brought in more services revenue for vendors and their partners. Network integrators too continued to change track by focusing more on services.

Two factors played a key role in the growth and expansion of enterprise networks. One was the substantial drop in prices of PCs and laptops and the growing ubiquity of networks, the other was the increasing desire among Indian enterprises to compete at both domestic and international levels.

Driven by a continuous adoption of technology across all verticals-service providers, manufacturing, banking, BPO, education-the networking market including services registered a 27 percent growth. As per V&D estimates, the total market size was Rs 6,302 crore. Registering a 29 percent growth, enterprise networking equipment market reached Rs 5,261 crore in 2004–05. Network integration services including network management services grew by 19 percent to reach Rs 1,041 crore. Except for VSATs, storage, voice solutions, and structured cabling, all other enterprise network equipment segments witnessed more than 30 percent growth. The highest growth was registered by WLANs, followed by modems and switches.

While large enterprises in the BFSI, IT and BPO, and education sectors continued to be major customers, SMBs also emerged as significant buyers. Also, besides Delhi, Mumbai, Chennai, and Bangalore, growth came from networking deployments in Pune, Hyderabad, and Chandigarh.

The past year saw a lot of investment happening in MPLS networks and the concept of managed services gained significant traction. Managed services like IP-VPN, managed IP-telephony, and managed security found acceptance among both large enterprises and SMB segment. Also, broadband network rollouts by both state-owned and private telcos also aided adoption of networking in the enterprise segment. There was an increased interest in IP telephony and network security deployments. Wireless networking gained traction in the SOHO segment past year.

Meanwhile, Cisco's undisputed reign of the enterprise data networking market continued through the year. The vendor also gained significant position in the voice solutions market with a 13 percent share. Even though its revenues dropped significantly, yet again, Avaya was the market leader in voice solutions with Siemens at number two. Other significant vendors in the data networking market were D-Link and Nortel.

Ravi Shekhar Pandey