Telecom Power System: Charged Up

Reliability is the catchword in any public system that services consumers 24x7x360 hours. Telecom networks fall in this category. The exchanges of networks, the server farms of Internet Data Centers (IDCs), the hubs of satellite service providers, the gateways of international long distance operators, modem pools of ISPs … you name it, most telecom facilities need redundant and efficient power supply. Not only can service providers afford to have their services unavailable, bad supply in terms of fluctuations can cause the degradation of the quality of service provided.

Given the growing importance of power systems, the telecommunications power systems industry has been, like other back-end industries, largely behind stage. However, this is one industry that is growing rapidly. In fiscal 2001-02, DC power systems, used mainly in telecom switches, is estimated to have generated a sales of Rs 450 crore.

The Overall UPS market

The major players in the UPS market in India are APC, TVSE, Emerson, Wipro, Invensys, and Powerware. Other significant but regional players are Microtek, Elnova, Champion, Vintron, and Numeric. There is also a large unorganized sector that thrives on assembling.
The telecom sector is one of the most significant verticals for this industry with an approximate share of 15-20 percent of the AC-based UPS segment, in addition to almost entirely the DC power segment. (High-end AC-based UPSs are used in facilities of ISPs/IDCs and OSS/BSS centers of basic/cellular operators). Hence, the increased focus recently on this sector by players like APC, Emerson and Invensys.
What is also noteworthy is that the general UPS market has been seeing a consecutive downturn. In contrast, the telecom DC power systems segment has been growing and is further expected to post faster growth due to the increased pace in network expansion arising out of the privatization of the sector.a

BSNL is the biggest buyer, contributing roughly 70 percent of sales. The private sector service providers, which contributes the rest, is however expected to contribute to future growth as a number of players roll-out their basic, cellular, and long distance networks.

Market Dynamics
Power systems companies rarely come in the limelight. But behind the stage, there has been some significant shifts. Traditionally, telecommunications power systems has largely been the domain of the big telecom equipment vendors like Lucent, Ericsson, and Nortel. Either these players used to manufacture their own brands or bundle others products with their mainline telecom equipment. Of late, however, telecom equipment providers are concentrating only on core areas and getting out of the rest. Lucent has sold its power division to Tyco; Ericsson, Nortel and Huawei to Emerson. Even the bundling practice is slowly going out of practice as customers start preferring independent vendors for not only cutting out the margin taken by the switch vendors but also for their focused expertise in power systems.

International companies which were testing the Indian waters are now directly getting involved in the Indian market, by buying out their Indian JV partners or expanding their small operations into full-fledged ones. Tata Liebert is now Emerson; Invensys has come out of its CG days; APC is spreading its wings into the telecom space.

Top 5 Market Players (Only DC power systems and batteries segment)
Company	Remark	Revenue (Rs crore)
ITI	Largest telecom power systems player in India	100
Amara Raja	Largest telecom battery supplier in India	95
Tyco	Dominant player in the private sector	55
Invensys	Won a mega deal	25
Emerson	Well positioned with acquisition of power division of Ericsson, Nortel and Huawei	25
Others *		150
Total		450
*Includes Himachal Exicom, HBL Nife, Dyna, Benning SMC, Eltek, Afcoset, APC and other brands/bundled products.

Nareshchandra Laishram