“Scalability will be a major issue for Indian telecom providers”

Bill Cowper, industry director, Communications, Asia Pacific, Sun Microsystems, has worked in the telecommunications industry for 35 years, including 26 years with Telstra, Australia’s leading carrier. On a recent visit to India he spoke to STANLEY GLANCY about Sun’s offerings for the Indian telecom sector

Please provide us your views on the telecom scenario in India.

Telcos are the same the world over. They subscribe to the same technology and face similar business challenges. The key difference would be the environments in which they exist. But if the governments of developing countries want to drive social and economic change, then a robust communication infrastructure is a must. China, for instance, realised this early on, and today has more mobile phones than the entire world had four to five years ago. China went from nine million mobiles to more than 300 million in less than four years. I can see India taking a similar route. In 2001, when India had just 3.5 million mobile subscribers, I had predicted that the country would have 70 million mobile phones in the next five years. I had underestimated this. Today, the industry predicts that India will cross the 100 million mark in the next two years.

India has several advantages over more developed countries. Companies here do not have to worry about legacy systems. They have the advantage of starting off with the best technologies available in the market. The situation is similar to jumping from the Ice Age to the Space Age in a single leap. The fact that 35-40 percent of wireless customers of service providers such as Reliance and Tata never owned a landline connection is a case in point.

Infrastructure costs have also come down rapidly in the recent past. Sun’s Java Desktop System (JDS), for instance, costs only 20 percent of the Microsoft Windows/Office XP upgrade. Also, the cost of deploying a wireless infrastructure is 40 percent lower than that of wired infrastructure. I see a future where India will have more mobiles than wireline services.

Can Indian telecom service providers learn anything from China?

Considering the rapid rate of growth, scalability will be a major issue for Indian service providers. The telcos here need to learn how to scale up from China. As you scale up cost will come down. In China the average revenue per user (ARPU) has stabilised.

What trends do you see in this space?

The growth of voice is dropping. Customers have now begun to demand content. The killer application would be enabling the customer to personalise his environment based on his requirements. Telcos are looking at reducing debt, controlling costs, and finding newer sources of revenue. Service providers not only need to improve existing services, but also offer content and other new services in order to attract and retain customers and increase topline revenues by increasing ARPU. Companies are already gearing up to offer content. Data and voice integration is all about content. So are convergent networks and broadband.

Could you tell us something about your offerings for the Indian telecom service provider?

The telecom sector accounts for 35 percent of Sun’s total revenues worldwide. Even in India this sector accounts for close to 30 percent of our revenues. In order to reduce the cost and complexity of acquiring, deploying, and operating software technology, we have introduced our Java Enterprise Systems (JES) offering in India. JES combines 38 software products from Sun in a single offering. But the best part is our unique licencing model wherein a customer can licence the software from us for just $100 per employee. This makes it a very affordable solution for the telcos in India.

JES enables better control over licencing, planning and deployment. Maintenance, support, training and quarterly updates are included in the package. Telcos can in turn use this solution to develop, deploy and operate business applications such as messaging or a directory platform for their customers. Our strategy helps telcos take the incremental approach to enhance existing infrastructure. This ensures that an organisation can utilise its existing infrastructure. Other than this we have launched multi-threading chips. We are looking at doubling the processor performance but at the same price.