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The country's network integration market has churned one more growth story during the fiscal 2006-07, clocking a whopping 29% growth to touch Rs 6,733 crore as compared with Rs 5,219 crore in fiscal 2005-06.

The aggressive steps taken by the government to bridge the digital divide is a huge stride forward. The broadband policy of India, the various eGovernance initiatives, CSC initiatives, and computerization of G2G and G2C services are the main growth drivers. The falling bandwidth prices, increasing PC penetration and the emergence of knowledge workers have contributed significantly to this positive phase.

Among the network integration majors, Wipro Infotech won the race during fiscal 2006-07, with a revenue of Rs 1,028 crore, growing by 54% over the previous fiscal's Rs 670 crore.

HCL Comnet finished second, registering 65% growth to touch an income of Rs 812 crore as compared with Rs 491 crore during 2005-06. Datacraft, which clocked 30% growth, slipped to third position with a revenue of Rs 675 crore against Rs 519 crore in the last fiscal. Tulip also gained a lot, registering a 23.2% increase. HCL Infosystems is another player with 51.8% growth. GTL's revenue growth was 19.6%. Other companies contributed an additional Rs 2,896 crore to the NI market. It is estimated that the banking and finance segment has been the largest contributor to the NI business, with a total spend of more than Rs 900 crore. The IT-ITeS-BPO sector was the second largest contributor, with a total spend of Rs 871 crore. Government buying accounted for about 21% of the total market share and telecom for about 11%.

Indian SMEs have also changed the Indian IT scenario beyond recognition. SMEs look for best-class services and solutions in affordable prices and packages. They invest heavily in applications, consultancies, communication platforms, storage, security and other industry-related solutions. Marketers are, therefore, burning the midnight oil to tweak their solutions to cater to the SME segment.

TECHNOLOGY FOCUS
Vendors have tried to offer value additions in the form of technology. The focus was on key elements such as virtualization, consolidation, WAN acceleration, network re-engineering, bandwidth optimization, surveillance network and integrated NOC.

MARKET TRENDS
An enterprise trying to build a network or upgrade an existing one must look at the entire value-chain of network integration services, comprising consulting, products, project management, integration and implementation, and network management. While large projects continued to dominate, another interesting trend was the advent of total outsourcing and remote management services.

The technology for enterprise and service industry in India is moving towards total convergence, security, compliance, multi protocol label switching, metro–E, and Internet data center. At the service provider level, there is a fusion of network, data storage/processing and communication related infrastructure. More and more customized solutions need to be churned out at an amazing speed to cater to varied customer requirements.

The market has witnessed the emergence of efficient packaging of services under one umbrella, which helps to grow the market size for a particular platform. The greater need for newer bandwidth intensive applications has also lent a fillip to growth. Clients are demanding integration of their legacy PBX networks with their data network.

The major growth drivers in the domestic market are adoption of IT in the retail segment, expansion in the communications field, government investment on IT projects in non-IT fields, network re-engineering, and value-added services from the service industry. Indian companies are now willing to outsource their entire IT environment to a strategic technology partner. Companies want to focus on their core competencies and sign managed service contracts with stringent QoS clauses with service providers.

Outsourcing has added to the revenues of network integration companies substantially. Networks have become too complex and critical to be managed by in-house teams alone. Managed service providers (MSPs) have come into the picture. They are a more evolved form of the traditional network integrator. Logically, it is the next step in their learning, business ability and evolution process.

Enterprises now run a plethora of applications on their network, which has resulted in fatter bandwidth pipes. Thus, the volumes of bandwidth consumption have increased considerably. With innovative business lines coming up, NI majors will be able to bring world-class communication solutions to the customer, on IP, and will succeed in maintaining the base profits.

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