Indian telecom equipment revenues drop 2.5% to Rs117,039 crore in FY 2010-11

New Delhi: Revenues of the Indian telecom equipment industry plunged 2.52 per cent to touch Rs1,17,039 crore in 2010-11, from Rs1,20,069 crore in FY2009-10, according to an annual survey by telecom industry journal Voice&Data. 

The survey 'V&D 100' covered over 500 telecom companies in India spanning carrier equipment, enterprise communication equipment, and user device manufacturers.

According to the annual telecom industry survey, the 16th from the specialty publishers CyberMedia, close to half of the telecom equipment revenue came from carrier equipment manufacturers, which saw a dip of 12.12 per cent to touch Rs 58,294 crore during the year. In FY2009-10, the segment registered revenue of Rs 66,332 crore. 

The enterprise equipment vertical grew at 0.87 per cent to report revenues of Rs24,023 crore for the same period from Rs23,815 crore in FY2009-10. The user device segment that includes mobile handsets, fixed phones, datacards and tablets, contributed more than one-third to the total telecom equipment industry, at Rs34,722 crore recording a growth of 16.04 per cent.

The top 10

Mobile handset maker Nokia had the highest revenue during the year followed by telecom network equipment majors Cisco, Nokia Siemens Networks, Ericsson, and software firm Wipro. The other players in the top 10 were Samsung, Huawei, Tech Mahindra, TCS and ZTE. 

The Voice&Data study attributes the sharp fall in the carrier equipment segment to security policy formulated by the government at the beginning of the year, which prohibited many telecom operators from releasing network expansion orders.

The Top 10 club also saw the entry of Samsung at sixth position as its revenues grew 21% to Rs. 5,720 crore.

''Riding on the entry into the 3G era, 2010-11 promised to be a great year for the telecom industry but it recorded a negative growth of 2.5% to report revenues of Rs 1,17,039 crore. The telecom infrastructure industry failed to bag orders in view of the security concerns raised by the government,'' says Ibrahim Ahmed, group editor of Voice&Data who has steered these surveys for the past 16 years.

Within the carrier equipment business, most segments have shown a negative growth. Wireless infrastructure segment dropped 23.78 per cent to report revenues of Rs18,629 crore from Rs24,440 crore a year back. The top four players--Nokia Siemens Network, Ericsson, Huawei and ZTE--taking over 90  per cent of the orders.

The broadband infrastructure segment revenue fell to Rs 944 crore from Rs 2,190 crore in FY2009-10. The telecom software grew nearly 5% to record revenue of Rs 23,533 crore with Tech Mahindra, TCS, Wipro and Infosys taking the top 4 slots with a combines market share of 72.5 per cent. 

Network integration business registered revenue of Rs 7,479 crore from Rs9,200 crore in FY2009-10 showing a negative growth of 18.71 per cent. This is one of the few verticals where Indian players like Wipro Infotech, HCL Comnet, HCL Infosystems and Tulip together notch up over 50 per cent. The network storage business grew by 10 per cent to record revenue of Rs1,587 crore.

The survey also points out that to power over 3,50,000 telecom towers annually, the telecom industry consumes nearly three billion litres of diesel generating nearly 5.6 million tones of carbon emissions. CyberMedia has joined hands with Greenpeace to demand telecom operators to shift 50 per ent of energy requirements to renewable sources of energy by 2015.

Most operators are shying away from investing in creating pollution free networks as it involves significant investments.