Enterprises consider ERP as the most bandwidth hungry application

Enterprises today are using a number of bandwidth hungry applications. But ERP (Enterprise Resource Planning) solutions are seen consuming huge bandwidth. I caught up with D. Venkata Subramanian, vice president - IT & Projects, GFA (Global Franchise Architects (GFA) is a Switzerland based group which franchises seven food service brands across the world. Pizza Corner and Coffee World are their most popular brands in India), to talk about,

The applications that need higher bandwidth?
Presently, most of the organizations are spread across the country/globe. They need to get connected to their branch offices. Thus, broadband becomes a basic need for enterprises. Apart from that, broadband connection helps enterprises to make use of voice and video applications for communication.

Enterprise Resource Planning (ERP) solution is the most bandwidth intensive application and it's been deployed by a whole lot of enterprises, especially in India. Other services like global help desk support based on the web-enabled application require a good amount of bandwidth to communicate with their clients.

Technology do they prefer to access broadband and why?
We prefer DSL (Digital Subscriber Line). We have found this technology to be commanding and clear-cut. It's a flexible solution for today's enterprises and gives the highest speed.
The best thing about DSL is that it helps to reduce cost in an enterprise because there is no need to implement expensive infrastructure and for infrastructure upgrades.

There is no need for new phone lines or new equipments. As I mentioned earlier, most importantly, it delivers data in blazing speeds. We feel, DSL is the best way to transfer digital video and data to businesses.

Apart from that, DSL is easy to use. So, we need not give additional training to the users. It gives a better option instead of depending on the unstable dial up connections. DSL makes telework programs happen easily. DSL is already deployed and accepted by numerous enterprises and is thus emerging as a standard.

Disadvantages with DSL?
I don't want to say that DSL is a perfect solution in all manners. There are certainly some disadvantages. The one disadvantage that we have found is that DSL is distance sensitive. So services are decided based on the distance between the customer's and the service provider's offices.

It's the service provider's call to give connection to distant locations. Of course, most of the metropolitan areas are provided with DSL. But, when it comes to rural areas, distance from the service provider's office becomes an issue.

'Need of the moment' for enterprises and the future demands
Enterprises are demanding more and more bandwidth and they need to be connected all the time. So, the need of the moment is to get maximum uptime.The future demands compel the need for good and consistent speed, secured connection and affordable price.

Broadband helps enterprises to centralize storage

Enterprises, especially in India, are increasingly adopting broadband as an effective business tool. One such interesting application of braoadband is the 'centralized storage' model which helps businesses to cut down cost and increase productivity. I had a discussion with Praveen Ganapathy, director- business development, consumer & automotive corporate business development, Texas Instruments India about,

The factors that push the growth of broadband among enterprises

PG: I think the key drive of broadband among enterprises itself is the coming out of lots of high bandwidth applications. People use more bandwidth hungry applications like video conferencing, high definition, U-Tube etc

At the same time, in countries like India, enterprises are fast adopting a thin client work model where the storage and applications are on the server.High bandwidth connection helps to centralize your storage and bandwidth hu8ngry applications and thus reduce cost. It also gives people the flexibility of working from home. It also allows them to work on the move. This in turn helps improve productivity.I think, primarily, broadband helps reduction in infrastructure cost through the model of centralized application and storage.

India has more than 2 million broadband users. The Union Minister for Communications and IT, Dayanidhi Maran, has declared 2007 as year broadband and to hit a goal of 9 million users by this year-end. This is going to push broadband further in India. Apart from that, upcoming technologies like Wimax are helping to accelerate the growth of broadband.

The technology options for broadband and upcoming technologies

PG: The dominating technologies in the broadband arena are DSL (Digital Subscriber Line) and cable modems. While in US, cable modems remain the major technology; UK and India depend mainly on DSL. US is also deploying technologies like 'Fibre To The Home (FTTH)'which can give much higher level of bandwidth. Wimax is emerging as a viable option especially in India where the infrastructure for wired connection is still very poor.

So, technology adoption is purely regional. TI believes that that over time, DSL and cable modems are going to shift to FTTH. TI is also working on technologies like ADSL2, cable modems and Wimax.

Trends in the Indian broadband industry

PG: We are more bullish about wireless technologies in driving the broadband adoption especially in countries like India. Compelling services can actually drive broadband growth. Today customers are demanding more than data through broadband. Once the operators start delivering new services like Video, IPTV etc, broadband will become a basic necessity.

But, I still feel that two million connections is a very small number, in a country of this size. And the target of 9 million connections by the end of this year seems to be a tough task. We really need huge investment to boost the broadband industry in India. Broadband has wider scope in rural areas especially in the areas of healthcare and education. The government has plans to deploy broadband right from the Panchayath level. It's a very positive trend.

Since infrastructure is going to be a problem, wireless may be a better option for rural connectivity. So, lots of industry players are betting on one or the other sort of wireless technology for India. I would say, technically wireless is more feasible for India.

A comparison of the Indian market with other countries' markets

PG: I would say India is pretty slow in adopting broadband. In US they have almost 200 million broadband connections. In India we are still talking about hitting nine million. But, in one way, it's a positive trend. It's going to be more painful for developed countries to shift to emerging wireless technologies like Wimax, because they have already spend enough money on the installed infrastructure.

But in India, the investment so far has been very low. So we can actually skip some intermediate steps in broadband technology adoption and directly implement wireless technologies.

The other major difference is in the demand of customers. In India, the demand is still for data. In developed countries, the demand is more for high definition video content and other such services. In India, of course, we have voice, IPTV etc coming in a larger way. Online gaming is other such potential application, which is likely to drive the need for broadband in India.

The issues to be addressed immediately and in a long run

PG: For the customers, the only thing that matters is the content being delivered through broadband. You are not going to pay for the water pipe, you pay only for the water. In fact, in future, the operators are going to give free broadband connection. BSNL has already declared that they will give 2Mbps connection free by 2009. Later on, services like voice, video on demand, online gaming etc are likely to be delivered free of cost and the operators will be able to address the ARPU (average revenue per user) concerns.

The only key issue, which delays the adoption of broadband in India, is the lack of a right business model. I believe the revenue is going to come from value added services. And we need to find answers for- 'who's going to provide content? How do we ensure content security? What is the revenue model?' etc. for example, we have already started seeing trails on IPTV.

But, there is no content aggregator in India for IPTV. In the West, there are for combining content from everywhere and put it together. So the ecosystem for value added service needs to be evolved in India. And we need to have clarity on regulatory issues. We also need to ensure the quality of services being delivered through broadband. The customers are already used to some experience. So the broadband players need to deliver something better than that to make them happy.

The other challenge, in India is the cost. People want high bandwidth connection in lower cost. We need to really reduce the cost.

New services that have got greater demand among broadband customers

PG: Apart from standard broadcast TV, VoIP, video on demand, there is an emerging need for home security applications. Now, broadband customers can actually place camera in their homes and get alerts on their mobile phone if something goes wrong. Video conferencing is another future application.

As I mentioned, centralizing storage and application is the emerging trend among enterprises. A lot of revenue can be made from reality shows, MMS etc. So telecom industry has got a big role to play in driving the broadband adoption.I believe, high bandwidth secured connection is really what broadband is all about. It can enable a lot of applications like entertainment, education and healthcare. So the content is the key and the customers need to like that content. So ultimately, customer is the kingmaker.

Broadband is directly related to the country's GDP growth

Increased broadband proliferation can create a real IT revolution in India. However the country needs to work harder to get the best out of broadband and related services. I had caught up with Vinnie Mehta, executive director, MAIT (Manufacturers' Association For Information Technology) a few days back to talk about;

The broadband scenario in India

VM: There is absolutely no denying that Broadband is a very critical efficiency resource for any organization. We can't think of not being connected anymore. I think the broadband penetration is still very poor in India. The television sector stands as a good example for the broadband sector.

In early 80's when we had the Asian games, the government allowed the cable industry, which was a non-regulatory industry, to grow. What that led to was an enormous amount of content. Today we have hundreds of channels available on our television. TV penetration, along with viewer ship increased dramatically and thus TV became a very important medium for mass communication.

Unfortunately when we look at creating an IT revolution in the country, we realize that we have probably missed out some of the elements. Broadband penetration in India is pretty low. Apart from that, for the entire cycle to happen, along with broadband, we need the right content, especially in local languages.

Contents will also imply applications and services ride on the broadband infrastructure. The lack of content in turn results in very slow proliferation of broadband infrastructure. As a result, we are not able to harness the economic growth in the country. So, I believe broadband has direct relation with the country's GDP growth. If there were a plethora of services available on broadband infrastructure, it would clearly lead to economic growth.

The market opportunities

VM: I feel, India really need to push hard on the broadband because it is one of the very critical infrastructures that we are severely lacking. If India wants to focus on being a knowledge driven country, broadband is very important. But it does not mean that there is no hope in the country for broadband growth.

The government has taken some initiatives. This year has been declared as the year of broadband. By 2010, the government wants to achieve 40 million Internet connections out of which 60 per cent is expected to be broadband connections.

And, if you look at the market opportunity, it's really huge. 20 million broadband connections also mean 20 million set top boxes. 40 million Internet connections will lead to 40 million front-end devices. If broadband proliferates and achieves the targets that have been set for it, it is going to be a bonanza for the hardware sector.

The limitations of copper for delivering broadband and the other technology options

VM: India depends largely on copper for broadband delivery. Copper has limitations in delivering high bandwidth connection. In India we still deliver only 256 kbps, though in countries like UK, they were able to deliver up to 10 Mbps through copper.

Of course the government is trying hard to increase it. However, copper is somewhat limiting the capacity for delivering broadband. It can deliver only so much. The other option is to lay fibers which will be an expensive process.

We can also embrace wireless technologies. Wimax is emerging as a viable option, but again availability of spectrum for Wimax remains an issue. We need to be clearer on this. For a country like India, which is so vast in its geography, wireless makes more sense.

The need of enterprises to invest in broadband

VM: Broadband acts as a mechanism of delivering so many services. For enterprises, there is always an economic value- add from these services. For example, the cost of VoIP would be one be one by tenth of that of the normal phone calls.

Video conferencing not only saves money but helps us save time and stress of traveling from one place to the other. Right use of the technology always saves money and time for enterprises. Broadband is the best of example of that. So, it definitely makes sense for enterprises to invest in broadband.