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 Home > V & D 100 > V&D100 - 2007 > Top10 Vendors: 6 - WIPRO: Winning Formula
  V&D100 - 2007
Top10 Vendors: 6 - WIPRO: Winning Formula
Mapping interests across the globe, telecom business is eyeing consolidation to grow
Thursday, June 14, 2007

Being the largest third-party telecom R&D services company in the world, Wipro has maintained its impressive momentum in the telecom market. For FY '06-07 the revenue from its telecom business, that includes telecom software and network integration services, stands at Rs 3,471 crore. This indicates a 24% growth over the previous fiscal. The telecom business has contributed 23% to the overall revenue of Wipro.

 The revenue from network integration services is Rs 1,028 crore, which combines network consultancy design and integration, network management services, and network security services. The telecom software revenue is Rs 2,443 crore, which combines revenues from system integration and software, telecom software products, and embedded telecom software among others.

Internally, Wipro has realigned its telecom business units to combine product engineering solutions and telecom service providers to form telecom and product engineering solutions vertical. This vertical will focus on both telecom service providers and telecom equipment and device vendors. It will provide R&D support for product engineering, software services in niche areas like IPTV, mobile TV and set top boxes, OSS/BSS system integration and enterprise networking.

The PES division, Wipro's R&D arm, contributes 35% to the telecom revenue. Wipro's telecom software revenue is mainly from North America, Europe and Japan while its networking solutions, network management, and security revenue is predominantly from the Indian market. In FY '06-07 Wipro had significant OSS/BSS system integration wins in India.

AREA OF OPERATION: Networking products and services
Address:
Cisco Systems India
IL&FS Financial Centre
6th Floor, C 22, G Block, Bandra-Kurla Complex
Bandra East, Mumbai 400 051
Tel:
+91 22 40434028
Fax:
+91 22 26533703
website:
www.cisco.com/global/in

Highlights

  • Strengthening R&D focus

  • Started manufacturing in India through Foxconnn

  • Acquisitions to power innovations

  • Selected India as the globalization center

  • Increased thrust on SMBs

  • Ensured 80% share in core routing and switching market

Continuing its aggressive mode, Wipro has made many strategic tie-ups and acquisitions last year. June last year, Wipro acquired Saraware Oy, a 21 years old company in Finland, specializing in telecom systems. The all cash deal worth $32 mn promises to enable Wipro to penetrate into high growth segments. 

Wipro entered into a joint venture with Motorola to deliver managed services for telecom operators. The company also signed a licensing and development agreement with British Telecom (BT) in August, to jointly develop an advanced mobile/remote workforce management system called 'mPower'. Oracle and Wipro came together to deliver Oracle Communications Operations Support Systems addressed at the IPTV industry. InfoVista and Wipro expanded partnership to support the growing carrier Ethernet market. Wipro Infotech also acquired 3D Networks and Planet PSG, which has a strong presence in business communications, convergence, and voice integration.

The Indian telecom market is key to our business'

What were the significant orders completed or bagged during the fiscal 2006-07?
Wipro got many big deals both from telecom services providers and equipment vendors in the areas of telecom BPO and projects that require capabilities across IT, networks and operations. Some examples of key wins were inventory consolidation and data migration for a US-based Telco, FMC consulting for a leading telco in UK, and CRM implementation for a service provider based in the Middle East.  In equipment manufacturer business we had good growth in tier-1 accounts and had added a good number of tier-2 and tier-3 accounts. During the year, we won comprehensive networking projects from prestigious clients like the Bharti Group. 

How do you view the domestic market for your business growth in the telecom domain?

Suryanarayana Valluri

vice president, TSP Group


The Indian market has shown good promise as it reaches global proportions. It's a leading edge market and Indian telecom projects are among the best in the world. This wasn't the case two to three years ago. That's why the Indian market is key to our telecom business. There is good traction in system integration projects.  

Why has Wipro realigned its telecom business vertical? 
Wipro believes that the telecom industry is moving towards a collaborative core (partnerships) and to win in such a competitive environment, it is mandatory to change our strategic outlook. We have realigned ourselves to focus more on these aspects. We have consolidated our dominance in the telecom equipment business, and grown in mobile and consumer business which is a significant differentiator. We have been able to combine all round growth in TSP, leverage IT, BPO and network competence, and incubated telecom professional services. 

What were the new challenges, and how are you geared to overcome it?|
Firstly, on the equipment vendor side we are observing a trend of consolidation with lot of mergers and acquisitions taking place. The second challenge is to reach the telecom service providers who are diverse in their offerings as well as geographically distributed. To further penetrate geographically, Wipro is leveraging its strength of Wipro Infotech's presence in the Apac region and Wipro Technologies' impact in the North American and European markets.

The third challenge is related to manpower strength where staff retention is a key focus. Wipro is heavily investing in four competency groups which focus on OSS/BSS, service delivery platform, network testing, and network solutions.

Is there any significant trends in the OSS/BSS space? 
We know that there are three simultaneous factors driving service providers today, getting the cost down by automated business processes through integrated operational support systems, being able to offer integrated service bundles by transforming multiple stove-pipe process and systems stack into a common, multi service delivery capability and at the same time improving customer experience and driving new revenues from new innovative and software content.  

This has led service provider's interest in outsourcing basically on core side for areas like network management and operations. Investing in true service management solutions will be the key. Impact of consolidation will lead to reduction in number of suppliers and, thus, partnerships between ISVs and SIs will remain an important strategy for all players.

 

Wipro has over 10,000 employees in telecom business, and works across the globe. Its client list includes 8 of the top 10 equipment manufacturers, and 10 of the top 15 communication service providers globally. Its product selling business is predominantly India centric. However, 99% of its telecom solutions and SI business for both equipment manufactures and service providers comes from outside India.

Europe is a crucial market for all Indian offshore players, but more so for Wipro because it has more stake here than some of its closest Indian rival companies such as TCS, Infosys, or Satyam. Wipro is targeting $1 bn from the region in the next two years.

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