India's incredible growth story is manifested in the country's sustained performance to become the fourth-largest economy in the world by purchasing power parity (PPP), after the United States, China, and Japan. A strong domestic demand and inflow of investments have been the driving factors behind this phenomenal economic growth. Also, while growth in most of the Asian economies such as China, Thailand, and Malaysia, has been driven by the manufacturing sector, growth in India has been driven by the services sector.

Telecom Services

The Indian mobile market is still largely a voice market. Data revenue accounted for about 15 percent of the total mobile revenue in March 2011, as against close to 30 percent in China and the United Kingdom. However, data is undeniably going to be the key driver of the Indian mobile market in the years to come. The year 2010 was a landmark year in the history of the Indian telecom sector with the auction and allocation of 3G and Broadband Wireless Access (BWA) spectrum blocks. With the advent of better networks, India now stands at the cusp of the information revolution.

Converged Voice and Data. As the telecommunications sector is growing rapidly, broadband communication is also surging across India. The country's burgeoning economy and the Indian government's broadband initiatives have supported the continuous expansion of the broadband sector. The total number of broadband subscribers - including DSL, cable, fiber optic, and broadband wireless platforms - will reach 15.4 million at the end of 2012.

Under their enterprise business offerings, telecom operators provide end-to-end telecom solutions and national and international long distance services to corporate customers through their nationwide fiber-optic backbone, last-mile connectivity in fixed-line and mobile circles, VSATs, ISP, and international bandwidth access through gateways and landing stations.

The launch of broadband services at affordable prices has resulted in the bulk of Indian SMBs moving to broadband connectivity. DSL, cable, and wireless broadband adoption are also growing rapidly. Fueled by the increasing voice and data adoption among SMBs, there is immense opportunity for telecom operators to market integrated voice and data mobility solutions.

Mobile Value-Added Services. Mobile value-added services (MVAS) are becoming an integral and indispensible part of the telecom industry value chain. The MVAS market is expected to increase from `12,200 crore in 2010 to `48,200 crore by 2015, driven by the uptake of 3G services in urban as well as rural areas. Some of the services expected to
make an impact on the Indian telecom market are m-Banking, m-Education, m-Governance, m-Health, m-Agriculture, location-based services, and machine-to-machine applications.

The Indian banking sector has grown significantly over the years with strong fundamentals; however, as per Reserve Bank of India estimates, about 40 percent of the Indian population still lacks access to formal financial institutions and, therefore, is largely unbanked. In the rural regions, the proportion of unbanked population is higher at 60 percent. Banking touch points are expected to reach just 0.07 per 1000 people by December 2011, still leaving a large proportion of the population with no access to banking facilities.

M-Banking services, in addition to being accessible to the unbanked, also involve low transaction costs. In India, banking transaction cost through the mobile channel is only `2 per transaction in contrast to `50 through the branch and `15 through the ATM channel. The RBI has urged banks to promote m-banking to reduce costs and pass the benefit to customers by lowering lending rates and increasing deposit rates.

Operators like Vodafone, Idea Cellular, and Reliance Communications have joined hands with some leading banks to offer mobile banking services. ICICI Bank and Vodafone have inked a pact to drive financial inclusion in India by offering mobile banking to the un-banked and under-banked population in the country. Under the tie-up, ICICI and Vodafone will together offer financial products such as savings accounts, pre-paid instruments, and credit products through a mobile-phone-based platform. ICICI will leverage the distribution strength of Vodafone, which manages over 1.5 million retail points for acquiring customers and servicing them.

Reliance Communications has launched mobile banking services for its GSM subscribers in collaboration with the State Bank of India (SBI). Axis Bank and Idea have signed an MoU to collaborate in the domain of financial inclusion whereby Idea will act as a business correspondent of Axis Bank and distribute a complete range of financial products and services offered by the bank. Idea has developed a technology platform that enables the provision of the entire gamut of banking products and services to the end-customer through mobile phones with cash-in/cash-out at Idea retailers.

Location-Based Services. The Indian market for location-based services (LBS) reached `2400 crore (USD 500 million) in 2011. Location-based data helps in customizing a mobile service/application to specifically address the users' needs. Therefore, mobile location-based services are very important for empowerment through mobile phones. Driven by various empowering mobile applications that are being launched, this market is expected to grow exponentially in the near future.

The LBS market is anticipated to be fueled by growing adoption of smartphones and 3G data services. To reach its full potential, service providers need to offer competitive data plans and work on technology partnerships to generate the data required for LBS to be possible.

Telecom operators including Idea Cellular, RCom, Tata Teleservices, Videocon, and Vodafone have invited quotes for LBS. RCom and Tata Teleservices have opted for a single LBS system, which will take care of both their GSM and CDMA infrastructure so that they can optimize cost whereas others will deploy GSM LBS system. Some of the major players offering LBS technology in India are Polaris Wireless, Ericsson Technology, CommScope, and Creativity Software. Technology wise, Creativity Software uses predictive matching, Polaris Wireless uses RF pattern matching, Ericsson opts for fingerprinting, whereas CommScope uses multiple technologies.

The rapid evolution of mobile phones, both on hardware and software levels, coupled with a surge in application storefront releases, deployment of higher-capacity network infrastructure, and recent developments in positioning technologies could drive revenues from mobile LBS to more than `60,960 crore (USD 12.7 billion) by 2014, according to Juniper Research.

Enterprise Services Market

The compelling economics and flexibility of Ethernet and IP VPN technologies are driving a substantial service uptake by enterprise customers. These technologies can support a mix of applications at a relatively low cost, including video conferencing, business continuity, high-speed file transfer, VoIP, Internet access, and virtual private networks. The overall global Ethernet service revenues are expected to double and reach USD 33 billion by 2013.

Communications service providers (CSPs) are competing fiercely and continually scrambling to differentiate their services to keep up with competition and customer expectations. Perhaps the best way to differentiate is to play a greater role in helping enterprise customers sustain their own competitive edge. Conversely, while dynamic customization is attractive in theory, providing it can be an operational nightmare. Ethernet and IP VPN technologies are much more conceptual in nature, which makes them more flexible and fluid, but it also makes them more abstract, which can exacerbate commonly existing continuity problems.

VoIP Services. The real growth drivers of the voice over IP (VoIP) services market are SIP trunking, hosted VoIP, and unified communications services. The global VoIP services market is forecasted to reach USD 76 billion by 2015. The overall VoIP services market grew by 17 percent in 2011.

Revenue from SIP trunking services is expected to grow at a phenomenal 52 percent compound annual growth rate (CAGR) from 2011 to 2015. The number of seats for hosted business VoIP and unified communications services is anticipated to double between 2011 and 2015.

Virtual Private Network Services. Businesses demand greater bandwidth and enhanced performance to meet their ever-increasing communications needs. Organizations continuously strive to efficiently and cost-effectively communicate with geographically dispersed employees, remote workers, business partners, and suppliers.

IP VPNs have been playing a significant role in enterprises by providing the ability to deploy a cost-effective networking solution. It offers flexible architectural options that harness the strength and reach of IP networks and provides simplified, secure, and scalable connectivity. Additionally, businesses are leveraging their existing IP network infrastructure, thereby maximizing the return on investment and minimizing the total cost of ownership.

Network Integration Services. To address the ever-growing demand of enterprises, network integration solutions offer last-mile connectivity. The network integration services in India grew at the rate of 13 percent in 2011. The corporates are upbeat, propelled by the inflow of foreign investment. The increasing infrastructure investment and government initiatives have generated opportunities for SMB growth.

Data Center Services. The overall Indian datacenter services market is expected to grow at 23 percent to reach `11,800 crore in 2012. The third-party datacenter services are forecasted to grow at 34 percent to touch `2800 crore during the same period. Eighty percent of datacenter services business is still engaged by captive datacenters but the growth story for third-party data center services shows greater promise going forward. The BFSI sector leads the way with maximum penetration of data centers.

Business Continuity Services. These services encompassing disaster planning, risk management, recovery preparedness, and communications readiness are gaining acceptance across industries. Business continuity services provide enterprises with business-impact analysis, risk assessments, enterprise hosting and application services, a full continuum of storage solutions, high-availability network solutions, and network and IT security solutions.

Customization Is the Key

Enterprise services require increasingly complex designs, involving many moving parts and parameters for multiple locations and services. Adding to the complexity, these designs must continually change to accommodate more and more frequent shifts in customer business objectives.

Enterprises have been demanding higher levels of service customization, and at a lower operational cost.

Consistency starts by consolidating systems into one standardized platform with centralized or federated data. This platform coordinates a large number of functions previously considered disparate in nature, from component creation to offering assembly to service qualification to order processing. A consolidated environment allows a more accurate understanding of product creation and offering assembly for more effective qualification.

The enterprise services market represents a high-revenue, high-growth opportunity for communications service providers. Differentiation depends on the ability to provide dynamically customized services that allow customers to maintain a competitive edge in fast changing business environments.

Dynamically customizing services using traditional technologies and methods proves to be quite expensive. Consolidated platform providing accurate, consistent data, and enabling consistent processes is an economical solution. Enterprise services cut operational costs, increase automation, improve operational visibility, and, most importantly, differentiate themselves in the enterprise market.