Largely responsible for bringing greater focus to Tata Communications, N. Srinath, CEO and managing director, talks about the company’s future plans and key challenges. Excerpts..
Where would you place Tata Communications in the overall competition scenario?
Tata Communications is a global leader in the service provider segment. We are the largest wholesale international voice carrier with over 25 billion minutes of traffic annually on our network. We are also one of the world’s largest owners of submarine cable networks and capacity. Tata Communications is a leading, global Tier-1 IP network with a strong presence in all regions. In India, we are the leader in enterprise data, long distance and internet services. On the back of its global infrastructure and leadership in India, Tata Communications is poised to deliver a new world of communications to advance the reach and leadership of its customers.
What level of investments are you looking at over the next few years? Which segments are likely to receive more investments?
Tata Communications plans to invest about $2 billion over the next three years. A major focus is on strengthening our submarine cable network, particularly in connecting India, Asia, the Middle East and Africa to the rest of the world. Building out a Wi-Max network in all major towns and cities of India to enable the growth of broadband services is also a priority. In addition to creating infrastructure, we are also investing in developing new value-added services for our enterprise customers in the areas of collaboration, hosting and security.
Who are your biggest competitors in the long distance and Wi-Max segments?
Our competitors in this space are the major global telecom companies. In the Indian broadband space, several major telcos have announced plans to build Wi-Max networks.
What are your broadband plans? Are you planning any further acquisitions abroad?
We believe that the broadband market in India has great potential in the years to come. We have already launched our retail Wi-Max offering in Bangalore and propose to extend the services to several other major cities this year. We are also looking at offering broadband services in South Africa through Neotel. At this stage, we do not have any plans to offer retail broadband services in any other market.
What is Tata Communications’ biggest strength and which are the areas that need to be strengthened?
Tata Communications’ biggest strength is its Tata Global Network (TGN), a global infrastructure of undersea cables, terrestrial backbone networks and IP, MPLS and Ethernet PoPs. TGN enables us to serve global carriers, service providers, enterprises and other business customers with a variety of network and managed services. We need to strengthen our portfolio of managed services and build the capability to market and service these innovative offerings worldwide.
Of all the markets that you are presently operating in, which region contributes the most to your revenues?
India is obviously our single largest market since we began our business with 100 per cent revenues from here. While the Indian market continues to grow rapidly, we are also benefiting from strong revenue growth from our global markets, in particular, the US and the UK. In future, we anticipate Asia and other emerging regions to also contribute to this growth.
What are the major challenges you foresee?
We are in a highly competitive industry and the intensity of competition continues to increase. Focus on world-class customer experience is key to our success and we cannot take our eyes off that goal. The availability of an adequate number of talented managers with experience in the telecom industry is also an emerging challenge, particularly in markets like India. We are working on various programmes to build and supplement the skills and capabilities of our managers.
What growth trends do you foresee and which segments are likely to do better?
Large enterprises are increasingly seeking converged and managed services. There is a trend towards the bundling of IT, networking and hosting services. Tata Communications is well placed to take advantage of this trend by offering managed services in conjunction with our sister company, Tata Consultancy Services.
The significant growth of video sharing and other networking activities on the web is translating into a major demand for submarine cable bandwidth, IP networks and content delivery network services.
With lesser growth rates in some of the developed markets, most large enterprises are looking at emerging markets like Asia, Africa and the Middle East for their next wave of growth. With our infrastructure strengths and better operating knowledge in these markets, we expect to play a major role in enabling our customers to reach these markets.
