Feature Story

July 18, 2003

India's telecommunications infrastructure is undergoing rapid development, and with parallel changes in its regulatory environment, the market is opening up to allow new forms of converged communications applications, most notably IP telephony. A country with a population of more than a billion, but which only has about four telephone lines per 100 people according to the International Telecommunications Union, India stands poised to fully benefit from the latest in voice technology. Cisco India has been at the center of this evolving market, advising both government and business leaders on the potential benefits of IP telephony and of converged voice and data networks.

As head of Cisco marketing in India and the SAARC (South Asian Association for Regional Cooperation) region, which also includes Bangladesh, Bhutan, Maldives, Nepal, and Sri Lanka, Ranajoy Punja helps in this push toward the widespread use of IP telephony. News@Cisco recently sat down with Punja to find out why India and South Asia are at the cusp of unlocking the power of IP telephony and what this means for Cisco in the region.

Why is South Asia going to be such a hotspot for IP telephony?

Ranajoy Punja: Companies in India and elsewhere in South Asia have truly begun to embrace the concept of an intelligent networked organization. What started with the need to connect a few computers through a network device to share resources like printers and files, has evolved rapidly to become a multi-services enterprise-wide LAN (local area network). Over time, and with an improved overall telecommunications infrastructure, WANs (wide area networks) became the backbone for internal organizational communication and today they are an integral part of corporate-wide networks. With the rapid increase in Internet adoption across the region, we now see companies actively looking for VPN (virtual private network) solutions.

But while enterprises have invested significantly in building data highways, they have continued thus far to invest in separate traditional voice infrastructure. As investments in data communication equipment accelerate, driven by networked applications that facilitate banking, enterprise-wide integration, and workforce automation, CIOs are recognizing the need to rationalize investments and get more for less. The next step in this evolution is to merge the two highways and put voice and data on a common IP network. The logic is inescapable. Why have two networks when you can have one? IP telephony addresses this need head-on.

How are India and other South Asian countries using IP telephony in a way that makes you so confident of the success of this technology in the region?

Ranajoy Punja: New applications enabled through the convergence of voice and data on a single IP infrastructure are fuelling the development of entire industries here. India in particular has been extremely successful in building a very powerful industry centered around contact centers, IT-enabled services (ITES), and business process outsourcing (BPO). More and more companies are moving their contact center operations to this country because of our significant expertise in developing and running them in a cost effective and successful manner. The growth of IP telephony means that contact center agents will be able to use more sophisticated multi-media applications that leverage both voice and data services, such as computer-telephony integration, where the agent and the customer can work together online to sort out problems more efficiently, in real time.

Contact centers, ITES and BPO all play an important part in the growth of the Indian economy. While many other countries continue to invest in traditional circuit switched telephony technology in their call centers, leading players in India have understood the benefits of IP-based contact centers and have adopted an IP approach to help them deploy differentiated services on a global scale. We have the people and the expertise here in India to offer customers worldwide, an enriched contact center experience. IP telephony is letting companies maximize that potential.

Can you give me an example of how a contact center company is benefiting from IP telephony?

Ranajoy Punja: Cisco has many contact center customers all across India. One that comes to mind is vCustomer. With $12 million invested into its India operations, vCustomer handles over two million calls every month from around the world. In its contact center in New Delhi, vCustomer has some 2,000 seats and is supporting all those agents with just one rack of Cisco equipment. That is the power of IP telephony.

Phoenix Global, Transworks, Manjushree, Nirvana are among some of the other IP-based contact centers that are serving end-customers around the world.

What sort of benefit does IP telephony offer companies that are not contact centers?

Ranajoy Punja: If an enterprise has multiple locations in India, or other offices overseas, IP telephony is virtually a done deal with them. An IP telephony system can offer a payback time of about a year to two, and that is taking into account the substantial drop in long distance prices India has witnessed in the past few years. Enterprises are realizing this and are flocking to try out IP telephony. We're shipping several thousand phones a quarter, and we recently celebrated the deployment of our 20,000th phone in South Asia. And even with these numbers, the South Asia still remains virgin territory for IP telephony, which means the potential for growth here is enormous.

Cisco is uniquely positioned because we are one of the first and only vendors in India to get approval from the Telecommunications Engineering Center of the Department of Telecommunications for our IP telephony solutions. This puts us at the leading edge in India in rolling out such value-add IP telephony applications as multi-party conferencing, directory integration, XML integration and application prioritizing calls.

Where does IP Telephony go from here in South Asia?

Ranajoy Punja: Up, there is simply no other way to put it. Although some regulatory barriers still exist at the moment that prevent the immediate growth of IP telephony here, we are working with governments and hopefully these regulations will change soon. For example, at the moment an IP telephony system cannot make a regular PSTN call here. We are hoping this will change soon. Already the regulatory environment has become much more relaxed in the past few years and this has helped to jump start the IP telephony market.

We are also crossing the comfort threshold with Indian enterprises and IP telephony is no longer seen as some strange new invention. Customers across a wide spectrum of verticals have adopted this technology. This includes banks, financial institutions, government, enterprises, education, manufacturing and the services sector. IP telephony has already built up a solid track record and it is now getting a lot of attention from companies that usually may be cautious about new IT spending. More and more organizations are asking to test the technology and many more are realizing the immediate benefits of enhanced business communications. Cost and ease of management are the first two benefits, but companies now are also trying out productivity-enhancing XML applications. As these applications continue to gain acceptance across the SAARC Region, it will rapidly become clear that there simply is no logical alternative to IP telephony in this region.