While most Indian IT companies—including biggies—are content to provide services, here’s a company that’s sticking its neck out and developing products for the international market. Network Programs is set to put India on the global research and development map, says Shipra Arora

Network Programs is looking to the telecom-munications industry to drive growth, says Vipin Tyagi

While India is being branded as an IT services and BPO destination, there is one company which is trying to evolve beyond this paradigm. At a time when many companies are trying to take the easy route to gain a share of the American customer’s dollar, a networking solutions company, Network Programs (NP) India, has decided to do otherwise. The company’s focus is on building successful product case studies and putting India on the global research and development map. Vipin Tyagi, president and chief executive officer of NP India doesn’t discount the IT services and BPO wave, but insists it is time for India to move up the value chain.

NP India was set up in 1996 as a wholly-owned subsidiary of the parent company, Network Programs USA. A SEI-CMM Level 3 company, NP was founded by a group from Bell Labs and Bellcore in 1996. The resource base was augmented by the addition of a team from C-DoT and other R&D centres. This perhaps explains the strong R&D orientation of the company. Starting off with seven employees, the company went on to add 70 people within the first year of its operations. NP bagged its first project in 1997 from Japan. Apart from handling projects like designing hardware for set-top boxes, designing video servers, integration with ATM switches, etc, the company also did some development activity outsourced by the parent company. Gradually, development work in India began to gain pace. Today a huge proportion of the development activity for its current product line is based in India.

From subsidiary to HQ
The equations have changed significantly for the company, and the change has been conducive towards furthering its cause of unleashing India’s R&D capabilities. From a subsidiary set-up, the Indian operations have recently acquired the status of being NP’s headquarters. With this shift, India is going to emerge as the hub of activity and decision-making for the company. Tyagi feels that the Indian operations will stand to gain significantly from this in terms of investment, expansion, product development and R&D activities. The core software development will happen in India, and the India Development Centre is going to support almost 85 percent of the overall development activity for NP globally. It has also been decided that all product development for third parties will be carried out by the Indian centre. This will soon kick-start an expansion spree, which will include expansion of the Indian development centre and upscaling of the infrastructure in terms of offices. Presently, apart from the Indian HQ, NP also operates from offices in Australia, Japan and the US.

R&D and business focus
According to Tyagi, R&D forms a strong foundation for the growth of NP. This is indicated by the fact that over 30 percent of the company’s turnover is invested back into R&D. NP’s R&D focus is on both already-established and futuristic technologies like artificial intelligence. The business focus areas, which guide the R&D focus, include network systems and network business applications. With this business focus, the company has evolved products and services in the following areas: IP-based applications and solutions, telecom business and operation solutions, enterprise wide networking solutions, broadband service delivery, e-solutions, and contact centre platform solutions. These solutions are targeted at telecom service providers, Internet service providers (ISPs), network equipment and service providers, system integrators, switch providers, enterprises, and CRM and PBX vendors. Verticals like telecom, banking, finance and insurance are the areas of major focus.

Products and solutions
It is the R&D effort, which has enabled the company to develop a successful product model alongside its service offerings. “There are hardly any companies that are trying to develop Indian product capabilities. As a result, while the country has made rapid strides in IT services and BPO, which is good, it has failed to register mindshare as far as products are concerned. We are trying to change that paradigm by generating product success stories,” explains Tyagi. In terms of product development, NP carries out its operations in two areas: development of its own branded products, and product development for third parties. The company has till date launched a slew of products for both the domestic and international markets. This is effectively complemented by a strong services portfolio to deliver a seamless end-to-end solution: integrating and bundling services like consultancy, design and development of networks, implementation, training, Web enablement, etc. “Product-centric companies are there only for license fees. Having both product and services expertise gives us a tremendous edge in the market we operate in,” explains Tyagi.

While two of its key products—Net Pacer and Net Relations—are horizontal in nature, the rest of the solutions are vertically targeted for specific niche segments. Having identified VoIP and IP in general as the key areas for growth, Net Pacer is geared towards establishing the company’s presence in the burgeoning VoIP market. The product, which has been targeted at ISPs and business enterprises with fairly robust networks, helps in managing network congestion and ensuring that network performance matches each application. It uses differentiated services, which is an IETF-specified quality of service mechanism that handles traffic flows in one or more networks. Two of its important features include dynamic bandwidth control, and managing voice, video and data demands on corporate LAN and WAN links. According to Tyagi, the product basically helps in resolving the two most significant issues faced by VoIP users, which are prioritisation and a good bandwidth policy.

Net Relations is a computer telephony solution providing applications like e-call centre, call centre and interactive voice response.

The other products offered by the company are Net Whisper and Net Collaborator. While Net Collaborator provides a collaborative tool for outsourced project management, the Net Whisper family of products offers a variety of VoIP solutions: Net Whisper (Gatekeeper), Net Whisper (Terminal), Net Whisper-323 Stack, and Net Beeper. Net Whisper (Gatekeeper) is a H.323 gatekeeper application featuring policy-based control of H.323 vVoIP zone, which allows organisations to set up robust and secure VoIP networks suitable for high-quality corporate use. According to Tyagi, at the heart of these products lies the modular H.323-based Net Stack developed using object-oriented principles to provide VoIP solutions to customers interested in special VoIP-enabled applications like Web chat and VoIP call centre.

Net Beeper is a solution for enterprises wanting to facilitate one-to-many voice communication required for company-wide message broadcasting.

Eyeing the rising BPO wave in the country, NP has recently developed the BPO version of its middleware integration solution, NetFlo, which is a workflow and enterprise application integration platform for automating the business processes of organisations. Key components of NetFlo include a process definition tool, workflow enactment service and communication.

As part of its solutions portfolio, the company offers solutions like Net e-OSS and netDSL that are customer care solutions for telecom and DSL telecom service providers respectively. Another solution, Net SLA, helps in monitoring and maintaining delivered and perceived quality of service.

According to Tyagi, the company is looking to the telecommunications industry to drive its growth. “We believe that the telephone is and will continue to be the major means of communication in the country, leading to tremendous growth in the telecommunications industry.” The company’s strategy involves embedding VoIP capabilities into all its offerings. This apart, the company is going to embark on a project in artificial intelligence for real-life applications; it will be a completely in-house and customer-oriented research project.

Geographical markets
NP India delivers its products and services in the domestic as well as international market. Presently, almost 19 percent of its total business comes from the domestic market; the company targets a 20-25 percent growth in this area over the next one year. However, whether this will change the present equations between the two businesses is not clear because the international business is also projected to grow to a similar extent.

NP has also tried to be innovative in its approach to the international market. While most Indian companies are putting their eggs in the American basket, NP has very low visibility there. Its major focus is on the Japanese market, followed by the Middle East, and countries like Korea, Spain, Germany and Australia. Even the dynamics of the company’s strategy for the domestic and international market is different. Tyagi explains that while in the domestic market the focus is more on the products business, the services business takes the lead when it comes to the international market. “The reason being that in India the perceived value of a product is higher as it is relatively more tangible than services. Here, people are more wary of paying for services. Our strategy is designed on the basis of this perceived value.” At present, only Net Pacer and Net Relations are sold in the domestic market. These two, along with the other products, are available in the overseas market.

Channels
NP delivers all its products and solutions in the domestic as well as international market through its channel network. As far as the domestic market is concerned, the company has set up a three-tier channel network. The Tier One network comprises companies like Crompton Greaves, Patni Computers and Hughes Software Systems. Tier Two and Three partners comprise relatively smaller players.

NP also has a channel in place for overseas markets. In Japan, the network comprises a large reseller and a smaller reseller; other countries have small locally-based resellers. In order to further grow the Japanese market and effectively exploit the opportunities there, NP plans to sell directly by 2003-2004; it also plans to set up a support system in Japan.

Expansion is also planned on the domestic front; the company intends to bring more partners into the fold. These will essentially be system integrators and network integrators with expertise in specific segments. The company is also trying to create a new business opening through partnering with managed service providers. According to Tyagi, “The trend is increasingly moving towards outsourcing the management of IT infrastructure. Hence we will be targeting those service providers for our partners who are catering to this market.”

Doing things differently and doing things right is what has marked the spirit of Network Programs India. Driven by its zest for constant innovation, the company might well find a place among the cream of the Indian IT industry in the years to come.