Dial IT For Growth

DQI Bureau
New Update

The impact of globalization led to the liberalization of the Indian economy

and, subsequently, to the near extinction of the license raj. The most visible

impact of this has been on the telecom sector-even a decade back the good old

P&T telephone was the object of all sorts of ridicule and lampooning as the

tele density hovered at less than 1%. Contrast this with 2005: forget landline

telephones, all kinds of sleek mobile handsets are available with a large

section of the people, as the tele density has shot up manifold to over 8%. And,

irrespective of the Indian Left resisting the FDI hike in telecom to 74% as an

anti-poor move, the fact is that this is one revolution that has not left the

lower middle class and even the rural junta untouched.


In fact, this increasing penetration of both mobile and landline phones in

remote rural interiors of the country, is calling for more and more IT usage.

And, with the 74% FDI now cleared by the government, most telecom service

providers would now have the financial muscle power to go for adoption of new

innovative applications. Typically, IT usage by telecos happens in three phases-while

for most Indian players the first phase has already happened, the second is well

on the way and the third has just taken off the ground.

With customer bases reaching a plateau, most service providers are looking at offering value-added services

To elucidate, the first phase involves the IT applications required to

support the entire telecom network infrastructure. It was in the late 90s that

telcos like Hutch and Bharti started setting up these infrastructures. Once WLL

was legalized, Reliance changed the entire ball game with a quick fire

installation, followed by the Tatas. As BSNL/MTNL were corporatized, they too

went for massive refurbishing of their telecom network. Though this phase can

never be completely over, at least the initial spurt has now slowed down.


The second phase at its peak now is the adoption of different OSS/BSS

applications by the telcos. Not only that, they are going in for a host of

applications like CRM with BI, data warehousing or even billing applications

that would integrate with the OSS/BSS. With customer base for each telco

assuming significant proportions, not only billing, even applications like churn

management and fraud management among others, are becoming popular.

The third area where IT usage is on the upswing is the maintenance of data

centers for almost every telco. With customer bases gradually reaching a

plateau, most service providers are looking at offering value-added services to

retain customers. To support multiple such functions, most service providers

like Reliance or Tatas have impressive data centers, which are basically run

through IT only.

One interesting event in 2004 was Bharti outsourcing nearly all its IT

requirements to IBM. It had already outsourced its network maintenance to

Ericsson-in effect then, Bharti is today just a sales and marketing company.

While other telcos are yet to follow this trend, watch out for further

developments on these lines.