BT Telecom India to target IT, ITeS and contract manufacturers

Chennai: Interesting and challenging times are ahead for the players in the $1 billion enterprise telecom solutions market with foreign companies crossing swords with domestic players.

The drastic reduction in the licensing fee from Rs200 crore to Rs2.5 crore and the increase in foreign equity holding limit to 74 per cent has largely facilitated the entry of foreign companies.

The latest to join the fray is BT Telecom India Pvt Ltd a 74:26 joint venture between BT Group plc, UK and Jubilant Enpro, a New Delhi-based company engaged in the businesses of oil and gas, food and services.

The joint venture would offer long distance (national and international) telecom solutions based on virtual private network (VPN) using multi protocol label switching (MPLS) and ATM.

According to C S Rao, managing director, BT India (Pvt) Ltd, "The enterprise telecom market is annually growing at 18 per cent. BT Telecom would start rolling out its services in four to six weeks. "We are targeting sectors like IT, ITeS, foreign contract manufacturing companies, automobile, healthcare, banking, financial services and insurance (BFSI)."

Rao has spent 25 years in telecom and datacom technology areas. He joined BT from Lucent India where he was president and CEO for the past two years. Prior to Lucent, Rao was with Tellabs India for 10 years where he was the regional director for SAARC countries, solely responsible for operations in India as well as South Asian countries.

After completing his post-graduate degree in telecommunications from the Indian Institute of Technology (IIT) in Chennai, Rao started his career with Electronics Corporations of India Limited (ECIL) in 1979 in data communications. He has also worked with the Centre for Development of Telematics (C-DoT) where he led the team, which pioneered the ISDN switch on C-DoT developed technology. Prior to C-DOT, from 1982 to 1985, he worked in the field of switching with BT in the UK.

As a part of that BT Telecom recently activated its BT 21CN node in Chennai. The BT 21CN is a global 'all Internet protocol' network. The company is setting up such nodes in India in different cities so as to offer its services to the corporate sector here-multi national companies (MNC) and Indian companies setting up bases overseas. The Chennai node has a total bandwidth capacity of 2.5 GBPS with future scalability of upto 10 GBPS.

Says BT Global Services CEO Andy Green, "Globally we are replacing our narrowband network with broadband technologies." Last February BT announced a $21 million investment in a global IP-based voice platform, which will see the current legacy TDM network replaced by an MPLS, based network across over 30 countries. A significant portion of that is planned to be invested in India.

Part of that is the setting up of nodes. As per plans BT Telecom will set up an additional node in Bangalore and new nodes in Hyderabad, Mumbai, Pune and Kolkata are slated to be set up soon. In total the company will be setting up around 14 such nodes in India.

Referring to other players he says, "We cooperate and compete with others. The domestic companies can carry the national long distance calls and we can take care of the international leg."

With the acquisition of i2i Enterprise Pvt Ltd, Mumbai in February 2007, BT Telecom is the largest foreign global carrier operating in India today. i2i Enterprises specialises in internet protocol communication services and is also a leading global managed services provider with a significant customer base in the IT, ITES and BFSI segments.

"Our revenue target is $250 million by 2009," says Rao.

As to the headcount BT Telecom already hired 200 employees. "We will be opening branches to market our services in different cities. There is a need for around 350 marketing professionals. In addition the network-operating centre (NOC) will need 300-400 technical hands. The i2i Enterprises acquisition got us around 150 people." According to him the company is yet to decide on the NOC's location.

Prior to floating BT Telecom, the British group was offering its services to its customers through a tie up with the Bharti group.

The other notable overseas telecom company in the enterprise solutions space is AT&T Inc, USA through AT&T Global Network Services India, a 74:26 joint venture between AT&T and Mahindra Telecom Investment Private Ltd.