Indian IT Industry: Vision 2020

Naresh Wadhwa, president and country manager, Cisco India and Saarc

Globally, the network is becoming all-pervasive as an increasing awareness of the transformational role that network connectivity can play has set the tone for the growth of the networking market in India.

As rural India achieves last mile connectivity it presents a huge opportunity for the IT sector. IT services banking, financial services and insurance (BFSI) and telecom will continue to be the key market adopters, while the government is likely to emerge as a big spender owing to the various e-governance and SWAN initiatives.

Technology investments to bridge the digital divide and drive inclusive growth in rural and semi-urban India are likely to gain momentum. Wireless for last-mile connectivity in rural India and unwiring our cities will be the focus in emerging markets like ours.

The advent of 3G in India has given the much needed impetus to the mobile value added services. Increased bandwidth will help improve the quality of video services which will in turn spur the growth for collaborative technologies such as TelePresence.

Healthcare and education sectors will continue to drive the growth of IT in India, with medical facilities being delivered over the Internet and distance learning being imparted over the Internet to students in remote areas.

ICT development in the energy sector also looks promising. Smart Grid solutions for transmission and distribution automation, security, business and home energy management, coupled with smart meter communications will help save huge amounts of energy and facilitate accurate distribution as per demand.

In essence therefore, continued investments by both the private and the public sectors will hold the key to the growth of the IT sector in India over the next decade.

Ajai Chowdhry, chairman, HCL Infosystems

Information and communication technology is the key to boost the countrys global competitiveness, says a World Economic Forum study.

Indias success in the IT-BPO domain over the past decade has been exemplary. Total export revenues earned by this sector grew from $1.8 bn in 1997-98 to $46.3 bn in 2008-09 at a CAGR of 35%. The industry has been an engine of growth for the Indian economy, quadrupling its share of GDP and exports to 4% and 16%, respectively.

While directly contributing to the GDP numbers and exports, this growth has had a multiplying effect too. Direct employment in the IT services and BPO segment touched nearly 2.2 mn by 2008-09, translating into creation of about 8 mn indirect jobs in diverse fields.

Still the country has not been able to tap the full potential of the ICT sector as penetration remains extremely low by international standards.

The challenge of ICT use is most visible in the large gap between ICT services, accounting for 90% of ICT GDP and ICT manufacturing. Consequently, Indias high level of network readiness has not translated into higher levels of usage; the national policy environment is yet to be moulded to facilitate development of new technologies.

Back home, the digital divide is increasing the gap between the haves and the have-nots. The poor are remaining poor due to no or little access to education, healthcare, banking, governance, besides additional livelihood opportunities.

There is however, a silver lining. The Gartner report for 2010 says India-centric IT services companies will represent 20% of the leading cloud aggregators in the market (through cloud service offerings) by 2012.

The mantra, therefore, must comprise: a comprehensive ICT policy integrating IT, Internet and telecom, fiscal incentives along with redressal of issues related to protectionism in the US and the UK, reforms in HRD and a well-defined PPP framework across education, healthcare, financial services and public services. This will enable the industry to develop content, applications and process frameworks. In other words, Access for All is the second ICT revolution in the country.

Ganesh Lakshminarayanan, president, Dell India

The Indian technology industry has had a phenomenal run over the last 10 years, contributing massively to Indias growth. The big question is: what next. Both at a global and at India level, the technology industry is at an inflection point that will redefine the types of products and services customers demand. The changing macroeconomic, demographic, social, business and technological trends offer an opportunity to make the next decade about a more inclusive growth with a more pervasive technology use. In the next decade, we must see technology solutions that allow new service models to overcome traditional models of healthcare, education and public services in India.

Increased connectivity is shifting the way we work, the way education is imparted, how hospitals deliver healthcare, how people use social networking, how and where people consume entertainment. Non-traditional delivery platforms like cloud computing, SaaS and mobile payments are gaining ground. Regulatory requirements regarding businesses, especially in matters of corporate governance, risk management, security, and global accounting standards are likely to intensify.

We believe that if we can unleash the power of technology to do more, whether through improved technology infrastructure like broadband, more local hardware manufacture, through improving access or through offering solutions, making companies and people to understand how technology benefits them, it could play a dynamic role in how India moves ahead to grow in the next decade. We need to drive internal consumption, make technology affordable and ensure digital inclusion to make the next decade a success not just for the technology industry, but where all segments of India become successful using technology.

Manoj Chugh, president, EMC India and Saarc

With the end of 2010, Indian IT has closed a successful decade. It was an eventful decadefor the industry recovered from 2 economic recessions. India discovered and enabled new business models that necessitated new learning; India further established its position as a global powerhouse in the IT industry.

There has been a lot of speculation regarding the Indian ITs ability to rise up the value chain in delivering high-output R&D solutions. However, India has certain clear advantages which will lead to its growth in R&D: growing engineering talent base; impetus from companies and the education ministry to enhance the education curriculum and exposure to gen-next; a mature industry that is already contributing to high-end R&D projects in areas like semiconductors, medical devices, mobile telephony, consumer digital electronics, automotive and aeronautics.

While in the 2000-10 decade, we saw Indias metros grow bigger and better and urban conditions vastly improving, the next decade will be focused on the emerging India that is made of tier-2 and tier-3 towns and this is where new concepts and trends, for example, innovative web 2.0 technologies and applications that enhance social media experience or multimedia-enabled products like the latest movie songs on a pen drive will be seen. Such technologies are creating a new personalized experience for consumers and shaping Indias IT consumerism in a new manner which is one of the key reasons we anticipate consumer storage devices emerging in a big way.

I believe India has a great reason to feel excited about the coming decade, and information technology will be a leading contributor for it!

Dr Kiran Bedi, corrections pioneer and Magsaysay awardee

Its a great leap forward with the RTI but the problem is what do you do with the information you get. Thats a real challenge. First, you had no information. Now you have, if you struggle to get some information, you get it. Then what do you do with it? Who do you go to? I get only what I ask for, whereas I need not ask for certain things, it should be up there on your websites. Your tendering should be totally transparent. Your 2G scam cannot happen if all the tenders of a particular amount and above have to be all on the website and have to be on the best bidding, and quality conscious. So, I think that kind of transparency is needed, which means that you have to be very integrity driven.

Pramod Bhasin, president and CEO, Genpact

Indias core competence will become services. I dont think the future could be brighter. Our demographics are hugely in our favour and we must remember that by 2020, they will be even more in our favour than they have ever been before. We are in the middle of the change that India is going through, the change that the world is going through. It can be frightening, but it can be exciting too.

Manish Khera, CEO, FINO

The whole economy in India and globally also is moving towards a digitized world. We are no longer dependent on a brick and mortar facility to avail of services.

Shiv Nadar, founder and chairman, HCL Group

Cloud has been talked about for a long time. Its like how Internet existed some 20 years ago. A very worrying range of data intensity of the way people do things and innate intensity of the way people do things will start changing. If you are in a rush to give a shape to it, you will never get it right. Dont be in a rush. These are all dots. If you are in a rush, then you have to draw this figure, what will it look like 10 years later. You know, it may look like a 100 storey building, but later it could be very different.

Dr RK Pachauri, director general, TERI

I think it has become a necessity. There is a lot that people within the IT industry can do to clean up their own backyards. I think, if we come up with solutions, there will be a huge market globally. So you are not doing it for altruistic reasons. There is a wealth of opportunities over there. We have the benefit of much lower cost of scientific and technical manpower than the rest of the world. So we can certainly be a step ahead of the rest in the world.

R Chandrasekaran, president and managing director, global delivery, Cognizant

The next decade appears full of opportunities for IT outsourcing as the industry continues to mature to a point where the benefit from labour arbitrage is being strongly complemented by the improved efficiency, effectiveness and innovation that companies are delivering. Taken together, these two factors will continue to stimulate companies to reconsider what is core to their business and what should be outsourced.

Four irrefutable and interconnected forces are gaining strength worldwide, requiring organizations across industries to rethink how work should be conducted. Work, of all forms, is migrating to its right location worldwide, allowing companies to leverage expertise anywhere and everywhere it resides; digital natives, both as employees and customers, are creating new social and operating norms for companies worldwide; new virtualized platforms are enabling real-time collaboration within organizations and with outside partners leading to new ways of working, managing and innovating; cloud computing, social networking, broadband and mobility are enabling new business and technology models that improve operational flexibility and knowledge sharing.

Together, these forces will make work increasingly dynamic, allowing organizations, especially in knowledge-intensive industries, to shift tasks to places where the talent and cost advantage can improve outcomes and business performance. In response, organizations will be required to gain a deeper understanding of differentiating knowledge embedded in key processes that drive business effectiveness, competitive differentiation and growth.

To achieve new ways of working, organizations will need more scalable and flexible IT systems and processes that allow knowledge to be captured and applied by virtual teams inside and outside the conventional organizational structure. This is where the Indian IT industry will discover unprecedented opportunities to scale up the value chain by building newer capabilities and broadening its services horizon.

Vivekanand Venugopal, vice president and general manager, Hitachi Data Systems India

I believe that cloud will be accepted as a valid infrastructure model. Although some hype will still be associated with cloud, there will be enough proof points to prove the concept. On-ramps to the cloud will facilitate the acceptance as well as management tools and orchestration layers that provide the end-to-end transparency to ensure service level objectives and chargeback.

In the next decade, the convergence in the data center will begin to take off thus, making it simpler and faster to deploy applications. The use of server, hypervisor, storage, and network virtualization will be the key to providing an open platform to ensure investment protection and customer choice.

Increased application transparency in a storage virtualization or cloud infrastructure will be required by applications. Without this transparency, application users will not be able to know whether their service level objectives are being met or not, how to determine chargeback, how to plan their utilization, or the health of their infrastructure.

Storage virtualization and dynamic provisioning acceptance will accelerate as they become the foundation for cloud and for dynamic, high availability data centers. Storage virtualization will provide the ability to non-disruptively migrate from 1 array to another and eliminate the costly down-time required to refresh storage systems. Dynamic provisioning enables storage to be provisioned in a matter of minutes, simplifying performance tuning with automatic wide striping, and enabling on demand capacity for an agile storage infrastructure.

Server virtualization has matured beyond the cost reduction phase of consolidating print, file, test, and development servers and is currently poised to support tier-1 application servers. Moving forward, for the support of tier-1 applications, server virtualization will need the integration of enterprise storage virtualization arrays that can offload some of the software I/O bottlenecks and be able to scale to meet the high availability.

Nandan Nilekani, chairman, UIDAI

Technology will really reach everybody. This combination of mobile number, Aadhar number, and bank account number will allow technology to be in the hands of everyone.

R Chandrashekhar, secretary, department of telecommunications

If by 2020, we would see a situation where all the government services are in fact available through the Internet, is available on the mobile telephone which would be the mass device, first action which the government has to take is to ensure a rapid rollout of broadband connectivity to all the villages in India, so that they can get the benefit of the services without having to leave their home or at the very least, they do not have to leave their village.

Neelam Dhawan, managing director, HP India

Predicting the future is a risk at the best of times. In a country as diverse and complex as India, the odds of understanding what ICT in India will evolve into is, at best, a calculated prediction. With the growing momentum around cloud services, we are at the cusp of the next evolution in IT services deliveryeverything-as-a-service. The next wave will be driven by a new model of computing. Instead of installing packaged software applications on their computers, people and businesses will use their web browsers to access a wide range of cloud services available on-demand over the Internet.

Individuals and businesses will have full control to customize their computing environments and to shape the experiences they want to have.

There will also be a shift in the mode and channels of sales in the next decade. Volume sales will be concentrated to large services providers who will leverage large data centers and cloud computing infrastructure to offer out services, software and infrastructure on a true utility based pricing model.

Most enterprises will create a hybrid service portfolio comprising of services from many sourcestraditional services, private cloud services, and public cloud services. While mission critical and business sensitive applications may continue to reside within the organization, automation and administration based services and applications will move to the service providers cloud infrastructure.

On the network side, there will be a transformation towards intelligent networks that can truly connect voice, video and data packets seamlessly across devices, network types and applications.

The end goal of the technology evolution should be social and financial inclusion. Access to connectivity, intuitive user interfaces on mobile devices and access to local content and applications via cloud services will ensure a more connected India where information flow is seamless and access to that information becomes perhaps a fundamental right. Perhaps the Right to IT may become the next fundamental right to all Indian citizens in the next decade.

Amit Sharma, COO, IBM India

We have been witness to an evolution in the telecom sector including increase in telecom penetration and a growing focus by the government on establishing telecom infrastructure. All this takes care of investments in ICT like the Unique Identification (UID) project, governments increasing use of ICT to drive its own agenda because ICT makes it more efficient. Some of the hot verticals include healthcare, media & entertainment, retail, education and energy; these are the segments where there is a growing appetite for ICT spending. The Indian ICT industry will grow on 2 countson the back of a resurgent and growing economy and therefore it is predictable that ICT industry too will grow; and penetration, even though ICT penetration in India still lags behind but there is a potential to grow.

Lakshmi Narayanan, vice chairman, Cognizant

The future is not about skills anymore, the future is all about ideas. Technology is something that we have demonstrated we are at the top of. Its the market, the innovation that we have to demonstrate in the future years. The future is about co-creating and collaborating with your end consumers in order to make sure that the consumers experience is the best that they can get.

Ramamurthy Sivakumar, MD, sales & marketing group, Intel South Asia

One thing guaranteed is that we can be proved wrong. My view is that the Indian ICT is roughly 2 decades old. The first decadethe 90s saw an exports oriented ICT industry, overseas clients, on-shore, off-shore, hybrid were some of the words in vogue then. We are now reaching a point characterized by local consumption; by definition that will drive what sort of resources get built, which sectors of industry get addressed. In the next decade I foresee that the Indian ICT industry will enter the golden age of innovation, given the maturation of the 2 decades of incubation, a pace of talent and growth is being built. Overall participation of investor community in the IT industry is in place and they understand how to fund companies. The year that went by was a good validation year for the industry and it convinced the investor community that you can make VC style returns in India as well.

Rajiv Bhalla, country head, sales & marketing, NEC India

The Indian economy has fared well in 2010. Today users are demanding for technologies like high-speed Internet, digital entertainment devices and Voice-over IP (VoIP) in their day-to-day life thus making it imperative for the hospitality industry to provide a true home-away-from-home experience to match their clients expectations.

According to players in the industry and media reports, the education & training market in India presents a huge opportunity. Apart from these sectors, biometrics market in India is also consistently growing from $116 mn in 2009 to $978 mn in 2017 (projected). With the adoption of security solutions across public and commercial sectors, public safety market in India is set to become mainstream.

Ashok Soota, chairman, MindTree

There has been no disruptive change in the IT industry for the last 20 years. The last disruption was in effect of the creation of the Indian offshore when we went and disrupted the global players and that process is continued. Somewhere down the line, there has to be another new disruption. The world will become more and more interconnected. For those who respond best and fastest to the change, are the ones who will survive and flourish and grow. We need it. Something different because we had too much of, let us say linear growth success but now it will be good to see little more churn.

D Shivakumar, VP and MD, Nokia India

If you ask consumers which brands do you trust or which brands will you buy in the next decade, all of them say, brands which do good for the ecology. Being green, makes good business sense. Consumers expect that. I would rather say that, manufacturing drives services rather than the other way round. India has its own trajectory in terms of growth. I think, we should stop comparing ourselves with X, Y, Z and of course, I think as we get competitors, exports will pick up.

Narendra Bansal, chairman & MD, Intex Technologies

The pace at which IT industry has reinvented itself is perhaps unmatched by any other industry. In India we have seen the software industry rapidly moving up the value chain from body shopping to development of customized solutions, products, applications and infrastructure maintenance. On the hardware side, however not much progress has been made.

I see a major change happening in this scenario in the next decade. We will have local manufacture of chips and this coupled with increasing competency in embedded software skills, India should get ranked amongst world leaders in this field. I also see local manufacturing of hardware products taking off. Government is already examining the recommendations of a Task Force on ICTE hardware manufacturing, submitted jointly by DIT and Industry. Chinese costs are rising; global players are increasingly focusing on the growing demand in India fueled by the governments emphasis on e-governance, by the large number of call centers/BPOs/KPOs setting up operations in tier-2 and tier-3 towns and IT education courses in colleges. Manufacturing of mobile phones and desktops in India to even cater to export markets has been established and component/sub-assembly vendors have set up base.

Given the adequate support by our government, I see India emerging as global #1 in both software and hardware in the next decade.

Rajendra Pawar, chairman and co-founder, NIIT Group

This decade will see a very large number of children coming out of school. Therefore, we have to get ready. Call it as a threat, call it as an opportunity, call it whatever. I see that the next decade is a decade where technology, application, education will get a full expression.

There is a range of offerings, for different kind of runners and the government is actually asking the non-government sector to come forward because the government, alone cannot, just cannot cope with the amount of demand thats going to be generated.

Girish Paranjpe, joint CEO, Wipro

A lot of IT spend that currently happens mostly in the developed countries will move to the emerging markets especially to Asia and a lot of our attention will therefore move to Asia, whether you look at cloud computing, whether you look at social network or you look at analytics. And all of this will create a brand new opportunity, not only in the consumer sector but a lot of that consumer IT will move into business space.

Ravi Venkatesan, chairman, Microsoft India

Over the past decade, India represents 2 kinds of opportunities for companiesa burgeoning market for products and services and a value-efficient offshoring destination, with abundant availability of quality talent. While the $60-bn industry has proved its mettle in both these areas, there is however, scope for improvement in the core areas. The selling opportunities need to penetrate the more remote areas of the country so that the people there have better access to technology, and consequently opportunities for a better life.

On the offshoring side, we need to move up the value chain, which is already happening. Rather than just offsetting cost, enterprises are increasingly offshoring more specialized aspects of their business, like parts engineering, product development, knowledge services and so on. Therefore we need to raise the level of talent by not just sourcing good talent equipped with the right skillsets and knowledge but also investing in our existing human capital.

This is the time for India to be seen as a country fostering innovation by ensuring a keen focus on R&D and nurturing talent and that the Made in India tag becomes the flagship of the nations IT industry. For this, the industry and academia need to work together, to ensure that the college talent is equipped with ideas and knowledge to take on the mantle of cutting-edge innovators.

To make sure that the next generation of talent and vision is ready, the IT industry needs to invest in education by playing a critical role in escalating the impact of existing government education programs through virtual classrooms. A shortage of teachers and infrastructure for classrooms has been one of the biggest challenges in bridging the quality gap between rural and urban schools. By leveraging ICT, the industry can help students gain direct access to the best teachers. It would also serve as an important tool to build the capacity of the teachers themselves by allowing them to go beyond the traditional teaching methodologies.

Rajesh Janey, president, NetApp India and Saarc

As we look back, at the decade past, technology has revolutionized the way we do everything. An era that started with the dotcom bust, gave a whole new meaning to words like cloud, virtualization, and where most recently global recession shackled high echelons of corporate power.

Businesses of all kinds are rethinking their IT infrastructures and evaluating alternatives to cope with the new realities of business growth and pace. There is a sense of urgency to act now and move from a siloed infrastructure to a shared IT infrastructure that is more efficient and flexible in addressing todays rapidly evolving business requirements.

Clearly the coming year and even decade, will be one of consolidation and we will see the fructification of key trends that began last year. And all of todays virtualization, cloud-based IT services, cost containment, and green IT initiatives will require storage that is more adaptable than ever before.

Enterprises will move towards virtualizing desktops and deliver mobile applications to empower their workforce with the capabilities and functionality that they demand. Most companies will have migrated or be in the process of migrating the bulk of their existing applications, including business critical ones, to virtual machines and this will stretch beyond 2011. No doubt, cloud computing will gain more momentum, and some of the caution the businesses have demonstrated in this area so far will be lifted.

I think the focus will move towards hybrid cloud as the decibels on public and private cloud get higher.

I expect unified storage will be the preferred storage portfolio in the data center that will store, protect, replicate and archive cloud data throughout its lifecycle. In turn we can expect a reduction in infrastructure costs for FCoE, NAS, and iSCSI as Unified Ethernet networks will continue to converge todays Ethernet and Fiber channel networks. In fact, as data growth moves from terabyte to petabyte levels, efficiency and automation will become more and more critical.

here will certainly be more use of flash memory to accelerate enterprise applications and there will be various deployment modelsarrays or host-side, cache or primaryas customers and vendors look for more ways to use it. More and more customers will adopt de-duplication (and compression)key to enabling efficient storage. Object storage will be a hot discussion in 2011 with expanding enterprise deployments starting by 2012.

Finally there are 2 mega trends underwaythe increasing realization that technology can deliver social good. Governments increasing focus on e-governance and the rollout of the UID project, technology will increasingly be able to deliver its value to the grass root; and an increasing consciousness on reduction of carbon emissions, eco-friendly and renewable energy. The need for green data centers will gain widespread focus.

Bhaskar Pramanik, managing director, Oracle India

Over the decade, Indian businesses have made a significant progress in technology adoption. However, in this progression, companies have ended up assembling a portfolio of industry specific business applications sourced from multiple vendors, mostly built on proprietary toolsets, which were integrated to work together.

Progressive enterprises in the future will not only demand complete integrated IT solutions that are engineered at the factory (not on their premises) but will also want these solutions to be based on open standards so that they get complete flexibility to plug any legacy applications. There will be greater focus on deploying technology that will enhance business operational excellence. The CIO will demand to work with fewer, but complete, integrated IT solutions providers, who can help free-up their time of managing multiple vendors and integrating disparate technologies.

With most enterprises having standardized back-end processes to reduce costs; they will now focus on implementing best of breed applications to deliver differentiated capabilities for their value-addition activities. These applications will need to be integrated with their legacy ERP systems through connectors. Building software infrastructure around standards based middleware and SOA will be critical for most enterprises.

More and more enterprises will be adopting cloud computing technologies to deliver differentiated services to their internal and external customers helping them reduce costs and their dependence on a high capex model to an opex model. It will enable them to use resources more effectively, provide for elasticity in demand and help reduce overall costs. Most enterprises will use a combination of private, public and hybrid delivery models to better serve their customer needs.

By 2020, Generation Ythe first generation to grow up with the Internetwill make up a large chunk of the workforce in India. New business applications will need to be designed for this Generation Y. Business application in the future will have to be designed for the knowledge worker and will have to take into account their ability to use integrated productivity applications, Internet phone services, and mobile devices.

There is increased awareness about building an energy-efficient IT infrastructure. Going forward, in our journey towards 2020, IT will be a driving force behind more energy efficient practices. Needless to say, while IT products and services need to become more environment friendly, but that cannot and should not be the only focus area. IT can play the role of a catalytic change agent for firms to make their entire value chains green.

Vijay Thadani, co-founder & CEO, NIIT

If India has to surpass the 10% growth mark then it has to realize the role of IT industry in making the infrastructure grow. One of the things required for sustained growth is human infrastructure; we have always maintained that we lack infrastructure sadly by this we mean the physical infrastructure and not the knowledge infrastructure. The Right to Education bill (when it gets passed in the Parliament) will put around 300 mn children in school, and if all go to school we will run short of teachers. The role of ICT in bridging the teacher-student ratio is critical. In terms of high education too, we have a 12.4% growth enrolment ratio and if we want it to be increased to 30%, then we will need 70-80 thousand colleges and would need to set up innovation centers. ICT will help us in delivering excellence, expansion (of faculty), and to make India a knowledge network.

On the skill development front, we want 500 mn skilled Indians, how will this happen if we do not have the institutes. ICT can supplement the lack of trainers, by making sure that there are simulated labs in the common infrastructure and also provide translation infrastructure.

The 3 priorities for education areon the inclusive education front, ICT can enable reach the unreachable at a fraction of resources; help in expansion as even now we need more universities and skill development institutions; and delivering excellence by going from product based economy to knowledge based economy.

Shouvick Mukherjee, VP & CEO, Yahoo! India R&D

The Indian ICT industry has evolved in the last two decades. In the next decade 2020 India will become a global IT product hub, lot more product companies from India are focusing on innovation. The main drivers of growth will be product innovation and cutting edge sciences and research.

The whole change in technology would be fueled around Internet and cloud computing as they will lower the barrier for companies to enter. The Indian market will become a key market as the IT demand for product requirement for Indian market will rise. The services model will be turned aroundfrom creating value for services it will now shift to creating value for products. Given our learning in the last 20 years, the focus will be on global innovation.

Compiled by
Stuti Das
(With inputs from Drishti D Manoah)
stutid@cybermedia.co.in