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30 Minute Interview
Managed Services gain traction in India
Vikram Sharma, Vice President-Service Provider, Cisco
India & SAARC talked to Varun Aggarwal about Cisco's Managed Services
offerings in India
Vikram Sharma |
Can you give an overview of Cisco's managed services offerings?
Cisco works closely with its Service Provider customers to
help monetize their investments in technology and enable them to create end-to-end
managed services offerings for enterprises and SMBs in India. It helps Service
Providers (SPs) through the entire life cycle of Managed Services i.e. envision
a service, build the service and market it. Our team helps providers explore
new services and expand existing ones. We help them in the areas of market intelligence,
marketing service descriptions, and comprehensive market guides.
Based on our understanding of SMB and enterprise requirements, we also help
operators develop accurate financial models, and map the right network infrastructure
to the right Cisco solutions. Cisco teams also work closely with SPs to accelerate
the design, development, and testing of new managed services by organizing technical
training events and programs.
Further we also support SPs in scaling network services and operations, if they
need to deploy solutions to support new services.
Can you name some of the SPs with whom you are working
in the sphere of managed services?
Cisco has been working with all the major operators in India in the area of
managed services, with some key ones being BSNL, Tata, Airtel, BT and Sify.
It provides Service Providers with end-to-end support for managed services in
planning, deployment as well as marketing of solutions.
We offer a well established 'Powered program', that awards the 'Cisco Powered'
designation to a select group of service providers worldwide that offer customers
reliable, proven, and cost-efficient technologies and solutions.
Enterprise managed services are still at a nascent stage in India. What kind
of potential do you see for these offerings in the Indian market?
The Indian market presents a huge opportunity for managed services. According
to a recent study by Forrester, the total addressable managed services opportunity
in India would be $8.27 billion by 2013, growing at a CAGR of 19%.
The emergence of new data technologies, the convergence of voice, video, and
data, and the explosion of e-business across industries, have resulted in corporate
networks dramatically changing and becoming increasingly complex. Businesses
have followed a 'Do-It-Yourself' model in consuming technology with high upfront
spending on CAPEX, high OPEX and taking on a significant risk of technology
obsolescence. However, companies are starting to realize the importance of having
tasks such as provisioning, implementation, configuration, support and ongoing
operations managed by a third party that specializes in these functions and
they have begun outsourcing these services, while concentrating on their core
competence. This trend has led to a revolution in the managed services offerings,
with Managed Network Services (MNS) forming the foundation.
By consuming technology via a managed service, businesses can avoid upfront
capital investment, transfer any technology obsolescence risk to the MSP and
minimize recurring operational cost of maintaining a highly skilled operations
team.
Cisco enables service providers to help solve these business challenges with
a comprehensive managed services portfolio, tailored for large enterprises to
small and medium-sized business.
What are the challenges for enterprise managed services
in the Indian market?
So far, Indian enterprises have been dependent on their own internal teams for
managing their IT infrastructure. The concept of outsourcing these services
is new to them. They need to have a long-term association with Service Providers
for managed services, which they are cautious about.
From a SP's perspective, since it has been used to selling bandwidth, it is
important for its sales force to be adequately trained so that they can offer
different SLAs (Service Level Agreements) to enterprises as per their requirements.
Cisco is working closely with both enterprises as well as Service Providers
to drive awareness about different aspects of managed services and address their
challenges.
Is the adoption of managed services greater within the
SMB segment? Which are the areas that are finding greater traction with the
SMB community?
The adoption of managed services within the SMB segment has increased over the
past few months. SMBs are increasingly looking at a single service provider
to offer key services, bundled together and customized as per their needs.
The interest in bundling services is strongly driven by the expectation of the
SMB to receive better integrated services.
Bundles based on Cisco's equipment are Integrated Service Bundles. For e.g.,
for the ISR, analysis demonstrated 70% OPEX savings (per branch, per year) with
integrated solution vs. 5-6 appliances. Within the SMB segment, bundled services
including internet, IP VPN and security are among the most widely adopted technologies
in the managed services domain. The major benefits of IP VPNs are cost savings,
flexibility and security.
Are enterprises comfortable trusting an external operator
that does business with their competitors?
Managed services are viewed as a continuum and range from basic levels of management
of access services, to complete hands-off outsourcing of network requirements.
As Service Providers, these operators have been traditionally serving multiple
enterprises by providing connectivity between their headquarters and remote
branch locations. There exists clear SLAs of security and privacy which Service
Providers sign, to deliver secure services over an MPLS network.
varun.aggarwal@expressindia.com
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