In a recent issue, Fortune magazine dedicated a special section to Indian IT czars in Silicon Valley (most of whom belong to the software world). Fortune spoke in glowing terms about these icons beginning to dominate this Western IT Mecca with their bold, brilliant and buoyant ventures.

We couldn’t help but feel proud of the massive strides India has made—not just in terms of individual successes, but as a nation—in the software and IT markets across the globe.

The Indian software industry has had humble beginnings—our software engineers were earlier treated as code developers and Indian software companies, sweatshops supplying cheap intellectual capital. Over the years the industry has shaken off this stigma—emerging instead as a powerhouse of "highly skilled" manpower with a feel of every single cutting edge technology and platform. Indian software companies are for instance supplying everything from animation software to WAP solutions, from browsers used on new generation wireless phones to e-commerce web sites.

There’s bigger growth post-Y2K

The software industry in India grossed US $5.7 billion of annual revenue in the 1999-00 fiscal with almost $4 billion coming out of software exports. Once again, the over 55% growth was reason enough to shut up critics, who had proclaimed that after Y2K, the Indian software export segment would slow down. On the contrary, the JFM quarter of year 2000 contributed almost 32% of the software revenue in fiscal 1999-00!

The fiscal year 1999-00 also witnessed the maximum demand for software professionals from India from other countries. The estimate of demand was anywhere from 200,000 professionals to half a million. I am sure that India will take on this challenge and meet such demands.

One of the most noticeable highlights of 1999-00 was that 185 of Fortune 500 companies outsourced their software requirements to India. During the year, companies in India continued to get SEI/CMM Level 5 Quality certifications in abundance and by August 2000, out of a total of 32 companies worldwide with SEI/CMM Level 5 certification, 16 were located in India—that’s 50%!

In the last 18 months, five Indian infotech companies have listed their ADRs in the US. Infosys, Satyam Infoway, Rediff.com, Silverline and VSNL have led the way, with 20 more in the pipeline, waiting to list at Nasdaq or NYSE over the next 15 months. This has made US investors further recognize the strengths of the Indian software and services industry, and in turn making it easier for many Indian software companies to export to the US. In 1999-00, almost 60% of India’s software was to the US.

India also continued to increase its software exports to Europe. During 1999-00, out of a total of $4 billion exports, close to $1 billion was exported to Europe.

The big news of 1999-00 was the growth of market cap of this industry. The market cap of the software industry went up from $4 billion in January 1999 to almost $104 billion in February 2000 and stabilized at about $65 billion by 31 August 2000, a distinction which made the industry a "best of wealth industry".

The domestic market continued to gain and went up from $1.2 billion to almost $1.75 billion. The segments of the government, banking and SOHO were the real highlights. Piracy figures came down from 63% to 59%. E-governance, however, was mostly just talked about—but is yet to take off in a big way.

However, in all this euphoria, the situation of telecom infrastructure and bandwidth remained in a state of flux, and the cost of international leased lines remained high.

Bandwidth: the last frontier

To become a software superpower, India needs to provide, apart from other things, adequate, affordable and reliable bandwidth.

In simple words, India requires quick implementation of a robust telecom infrastructure. At the same time, we also want sane policies so that we do not stifle technology. Take voice over IP: India is probably the only country actively attempting to ban this technology, whereas voice over packets is the direction world telecom is heading toward. The big Western telecom tech giants have already begun moving from circuit-switched to packet-switched long-distance voice networks.

Voice over IP must be allowed in India. Perhaps in a phased manner, and while taking into account the concerns of the existing players.

But first let’s address the issue of bandwidth itself.

With a $4.1 trillion market potential, e-commerce has become the engine of growth in the new century. India has done well in software—but this is only the tip of the iceberg. The future is in leveraging the IT skills in the country for e-commerce, IT-enabled services, IT services, et al. The skills have to deployed in a certain environment and with a minimum level of guaranteed infrastructure, particularly with interactive applications.

So far so good. But all this requires and depends on a very strong telecom infrastructure. Specifically, the availability of adequate and affordable bandwidth.

In this present Internet-based economy, per capita bandwidth utilization is an important indicator of the economy.

Page(s)   1  2