Uday Sodhi

After the establishment of its Internet telephony business, ISP Net4India has outlined its plans to foray into the managed service provider (MSP) business. This move is in line with the company’s agenda of establishing itself as an end-to-end services company. Apart from tapping the emerging managed services market the company also plans to expand its software development business, which is presently a miniscule part of its business operations. The MSP business, which will also mark the company’s entry into the international market, will be commercially rolled out by early 2003.

As part of its overall business strategy the focus for the company will be on its Internet telephony services business targeting both the corporate and retail markets. In fact, Net4India is targeting revenues worth Rs 25-30 crore from its retail Internet telephony business in the next 18 months. The company will be investing around Rs 5-7 crore into marketing the concept of VoIP booths, branded as ‘Phonewala-tele-centres’.

According to Uday Sodhi, the COO of Net4India, all efforts are in the direction of strengthening the portfolio of Internet services to project the company as a one-stop shop for any Internet-based service to its customers. Net4India will be leveraging on its data centre business to build up its managed services offering. “In the data centre business a whole lot of managed services are going to pick up. Internationally ISPs not only host services but also manage applications. This trend will catch up in the Indian market as well with companies increasingly going to outsource more and more to ISPs,” explained Sodhi. As part of its managed services portfolio the company will be offering services like intrusion detection, network monitoring, security, application management, etc.

The company has already initiated talks and is conducting beta tests with some of its existing customers for its MSP services. It will be further tapping the overseas market for offshore network management and outsourcing services. Net4India has already set foot in the UK market with the setting up of its sales and marketing office in that country.

However, in the next one year the company states that a large part of its growth will come from its VoIP and data centre business. The data centre business currently accounts for almost 45 percent of Net4India’s total business with a growth of around 30-35 percent. As far as Internet telephony is concerned the company has plans for covering around 400-500 telephone ISD booths by March 2002 for its Phonewala-tele-centres. With this the company will be able to penetrate 6-7 large cities, including the four metros. These Internet telephony booths will offer international calls over an IP network at almost one-fifth the cost of a traditional network. This will enable the company to effectively tap the Indian ISD market, which is estimated to be worth $1.5 billion, and growing at a CAGR of around 25 percent over the next five years.

Simultaneously, the company is also pursuing a strategy of moving into the high-end space by gradually de-focusing itself from lower-end offerings. As part of this strategy, Net4India is lowering its focus on dial-up access. The dial-up Internet access business for the company has reduced from 25 percent to 5 percent (in terms of revenues) in the last two years. Net4India will be increasing its focus on the corporate segment with its leased line business.