Telecom Industry Trends For 2014

Debasis Chatterji, CEO, Netxcell Limited shares his views on what the telecom industry can expect in 2014. Giving a brief overview of the year gone by, he says, “2013 was not so great due to several micro and macro-economic issues facing the country. Hyderabad has seen some turmoil due to Telangana issue. Telecom is going through a rough patch. The industry’s revenue model has not been in a great state as the price points have decreased and margins have been lower, which is not good for the industry. There have been various other issues on VAS restrictions with TRAI introducing 3rd party consent gateway etc which have further impacted revenues. Moreover rising inflation and high investment costs have added to the woes of the industry.”

“Telecom Industry has great hopes on 2014 that a stable government will take a relook at the National Telecom policy post the elections. Maybe after 2014 general elections, some telecom policy decision will evolve. And the market will be stabilised. However, we are optimistic about 2014. There is a trend to enhance the basic telephony rate and that will add to profitability. There will be investment to enhance the infrastructure. The industry is awaiting a firm decision regarding the telecom policy. We expect increase in pricing for telecom offerings in the coming year. Some kind of market consolidation is also likely to take place,” says Chatterji.

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“Overall in my opinion 2014 will be a much better year. A stead government with good policy decisions will bring in a tremendous change for the industry. Inspite of turmoil, the industry is currently growing at 14% rate, which will increase once there is clarity on the regulations front,” he adds.

Talking about the telecom trends in 2014, he says, “4G is set to revolutionise the Indian telecom scenario. The inclusion of fiber optic connectivity will tremendously increase the reach and bandwidth. 3G will also gain substantial momentum while 2G will continue to be the most preferred. The quality of services is set to improve with companies taking a step forward to invest in infrastructure. Cloud will be a game-changer for telecom as well, with more and more companies looking forward to saving costs, cloud deployments will be a preferred mode to acquire cost advantage. Analytics and data will drive the industry forward in the coming year. In my opinion telecom in India will witness major changes in the coming years.”

Ramesh Loganathan, Vice President and Managing Director, Progress Software sharing his views on the same topic says, “IT industry did very well this year. As recently announced by the IT department, we saw around 26% growth. A very visible growth in terms of new buildings being occupied and also the number of jobs created. We did see a lower than possible growth of new companies coming in and establishing offices; but no material impact given that most companies that have to establish offshore operations in India have already established and this is a very small part of the industry and industry’s growth. The Industry has actively worked on improving efficiencies over past few years- specifically in terms of reduced bench, increased utilisation of resources and IP leveraged services. All of which are required to ensure we remain sufficiently profitable given increasing costs and unchanging billable rates. The dollar-rupees exchange has given some additional time cushion to these medium- term efficiency improvement measures. Additionally, industry has made very good progress towards long-term growth sustainability that is possible only thru products and IP.”

“The services industry is looking at higher value services and IP leveraged services. Besides this, the startup culture is rapidly gaining traction with better ideas, teams and execution generating startups with a lot of promise. As seen at the recently concluded ITsAP annual products and startup awards event, and the TiE TES summit. And the increasing number of incubators in the city including those at premier institutions like IIIT-H, IIT, BITS and ISB are proving to be very serious enablers. We are getting into 2014 on a very strong note with lots of promise in clear sight,” he adds.

Talking about his outlook for 2014, he shares, “Some of the guarded optimism from last couple of years may ease a bit as there are no red flags in any major part of the world which is a strong start to the New Year. With worldwide economy showing a more positive outlook, this bodes well for the IT industry in India. In Hyderabad, specifically the flurry of activity in the tech startups space is adding a very nice silver lining to the industry. With some serious traction and results beginning to show up, I expect 2014 to be a seminal year in how startups evolve in Hyderabad.”

Loganathan’s top picks for the technology trends in 2014 are:

• Continued improvement of efficiencies in services delivery through better resource utilisations, leveraged projects and more IP/frameworks play.

• Mainstream traction for the new convergence of analytics, social and mobile on the cloud

• Continuing growth of technology startups; leading to better and bigger successes in the markets and amongst investors.