Netmagic bets big on innovations; says India witnessing unprecedented data center wave

One of the most well known names in the Indian data center market, Netmagic Solutions, is in the eye of a perfect storm. The Indian data center market is witnessing an unprecedented boom. A number of factors are fueling this boom. Firstly, India now has a government that is extremely keen to transform the nation digitally. With a project overlay of Rs 1 lakh crore, and an ambitious target of providing broadband connectivity to 2.5 lakh villages and making many schools Wi-Fi-enabled by 2019, the focus on digital can lead to a huge demand for data centers. Netmagic, which was one of the first focused players in India to see the huge potential of India as a rising market for data centers, is now enjoying the fruits of its hard work put in during the initial years.

Focus on R&D yielding results
Realizing that the market for providing data center services has a high chance of getting commoditized, the firm has been ahead of the curve in developing unique products for the Indian market.

“Our focus has always been to differentiate, and we do this by continuously investing in R&D for developing unique offerings that are customized to the Indian market,” states Sharad Sanghi, Managing Director and CEO, Netmagic Solutions.

For example, way back in 2011, Netmagic launched its public cloud offering called ‘SimpliCloud’, which has been accepted extremely well in the marketplace. Developed at its R&D Labs in Pune, SimpliCloud already has many large, medium and small enterprises across India, hosting a variety of CRM, ERP, mail and messaging, e-commerce and custom applications. Today, more than 10,000 virtual machines have been hosted on Netmagic’s public cloud.

With India witnessing a boom in cloud adoption, Netmagic is riding the wave. “Cloud has become one of the fastest growing business for us. Most of our customers have atleast one component of their IT infrastructure on the cloud,” states Sharad.

In 2012, the company launched Disaster Recovery as a service in India, and in the process became the first managed IT services provider to do so. In 2014, the firm launched India’s First Software Defined Storage Service. This service proved to be a game changer in India, as it was backed with guaranteed Quality of Service (QoS) on a pay-per-use model. Netmagic assures QoS by guaranteeing Input/Output Operations Per Second (IOPS) at the application level with total tenant isolation. IOPS is a common performance measurement used to benchmark storage and application performance and is an important factor when it comes to running critical applications. This service has been a huge success among organizations that are looking at flexible options for their IOPS-intensive ERP applications. Netmagic is also seeing huge demand from e-commerce players in India who perform real-time inventory lookups.

Understanding that many customers in India were still reluctant to adopt a cloud-based offering due to security concerns, Netmagic has also proactively pursued certifications such as the Cloud Security Alliance’s Security, Trust & Assurance Registry (CSA STAR) certification. Netmagic, is the first  cloud service provider in India to receive the CSA STAR certification, an industry benchmark for the specific security requirements of multi-tenant service providers.

Riding the eCommerce wave
The intense focus has paid rich dividends. Currently, Netmagic has more than 1200 customers, and is enjoying triple-digit growth on a year-on-year basis. “Today, we are at a point where we are most bullish on the market opportunity than we were in all our years of existence. There are a number of factors that convince us of the bullishness. Firstly, adoption of cloud is at an all-time high.

From an eCommerce sector perspective, there is huge potential and upside, as eCommerce is still a small part of the overall retail landscape. Netmagic already has a significant percentage of the market share in the eCommerce sector, and we expect this to go up even more. Thirdly, the Indian government’s focus on going digital will also lead to huge opportunities. Lastly, more banking players are likely to enter the fray with new banking licenses being rewarded. All these initiatives will lead the data center market to a new high,” states Sharad.

Among eCommerce players, Netmagic has a virtual monopoly with a client list which includes names such as Flipkart, Snapdeal, Myntra, Jabong, Shopclues, Yepme, Cleartrip, Yatra, Ibibo and Makemytrip.

Sanchit Vir Gogia_Greyhound ResearchComments Sanchit Vir Gogia, CEO, Greyhound Research, “Greyhound Research believes that with a focused approach to tap and provide services for eCommerce clients like Flipkart and Hungama, Netmagic will witness strong growth as more Internet-centric businesses grow. According to our research, the Indian Data center market can expect at least Rs 10,000 crore investments in the next three years. We believe Netmagic’s decision to expand their business by setting up its largest data centre in Mumbai with an investment of Rs 700 crore is a progressive step towards capturing the market and will help them to gain an edge over their competitors.”

To keep pace with the demand, Netmagic, now an NTT Communications company, is investing in expanding its existing data centers and building new ones where there is huge demand. In 2014, for example, the firm launched a 110,000 sq. ft. data center in Bangalore.

Netmagic’s bullishness is matched by analyst predictions. Gartner, for instance, has predicted that India will be the second largest market for data center infrastructure within the Asia/Pacific region, and it will also be the second fastest growing market in Asia/Pacific in 2015. Backed by a powerful parent and armed with a huge number of IPs, Netmagic is rightly positioned to garner a significant percentage of the data center market in India.