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The tremendous growth in wireless subscriber base together with increased usage of data services have forced the decision makers at telcos realize the importance of investing in state-of-the-art T&M equipment. On the other hand, the launch of 3G services, meant to support high-speed data traffic, offers new challenges. TRAI's recent paper found most of the telecom service providers wanting in the QoS parameters. It may be recalled that TRAI had set a timeframe of 36 months for mobile operators and 48 months for fixed line operators to improve their quality of service. The time period is now over and the regulator is all set to review QoS parameters again.
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The Reality
Despite these expectations, the telecom network test and measurement (T&M) equipment market in India has failed to register a healthy growth. The rate of growth has not lived up to the expectations of many vendors. T&M tools are either considered very expensive or too complex to be handled. Besides, many potential users of T&M in both the telecom and enterprise segment have been deferring deployment of T&M tools or are not quality conscious enough to take them seriously.
However, notwithstanding all this, T&M vendors argue that despite the hiccups, the best days for the Indian market are yet to come, as huge potential remains to be tapped. For them, the tremendous growth in the Indian telecom sector driven by the surge in mobile user base, the launch of broadband services and the investments being made by enterprises in mission critical applications and new networks holds the key to the growth of T&M market in India. "Wireless segment is growing very rapidly. Wireless subscriber base this year has overtaken the wireline subscriber base. In keeping with this trend, the T&M products for wireless network deployment application had a very strong business growth overall," says Shankar Roy Chowdhury, general manager (Marketing), Agilent Technologies India.
Jairam Pillai, managing director, National Instruments India says that the communications industry has been a driving force in the worldwide T&M market, and the Asia Pacific region in particular is seeing a more rapid CAGR than other regions. "This trend is likely to continue for the next 5-6 years, and India's rapid development in this space can be counted on to sustain this trend," he adds.
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"Wireless segment is growing very rapidly. Wireless subscriber base this year has overtaken the wireline subscriber base. In keeping with this trend, the T&M products for wireless network deployment application had a very strong business growth overall"
Shankar Roy Chowdhury,
general manager (Marketing),
Agilent Technologies India
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The Indian market has also seen the entry of new players like Anritsu. According to Kenji Tanaka, VP and GM, Measurement Business Center of Anritsu Company's Wireless Measurement Division, "We are looking forward to a good business opportunity in India and the setting up of our office at Bangalore is a step in that direction." Tanaka says "Anritsu is also looking forward to the launch of broadband and 3G services in India and would like to offer our expertise in this space. This, together with plans of global telecom equipment vendors to set up manufacturing units will give us increased opportunity to offer world class T&M services to these companies." It may be recalled that Anritsu recently acquired NetTest, a network testing company, to expand its portfolio of offerings.
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"The industry has been a driving force in the worldwide T&M market, and the Asia Pacific region in particular is seeing a more rapid CAGR than other regions. This trend is likely to continue for the next 5-6 years, and India's rapid development in this space can be counted on to sustain this trend"
Jairam Pillai, managing director, National Instruments India
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Boost from Manufacturing
The setting up of manufacturing units in India by global vendors like Nokia, LG, Flextronics, Elcoteq and others is also likely to fuel the growth of T&M market in India. "The big demand would come when equipment that demand testing are locally manufactured. Overall manufacturing would be the biggest growth driver. Growing R&D activities in India would also drive growth," says Roy Chowdhury.
Observing that the communications industry is poised to drive the T&M equipment market from the perspectives of revenue, technology, and innovation, Pillai says that India is well positioned to benefit from this trend because of the progressive shift in manufacturing and now R&D facilities of global giants to India. "In addition, another heartening aspect is that there are a good number of design start ups that will contribute to this growth. Provided their requirements are met and their concerns are addressed, we can expect sustained growth," he adds.
Tanaka says "The plans of global telecom equipment vendors to set up manufacturing units will give us increased opportunity to offer world class T&M services to these companies."
Technology Trends
Software-based solutions gain Prominence: T&M equipment manufacturers are placing greater emphasis on software to make measurements easier to use, faster, and more accurate. Since these software-based testing equipment use PC-based platforms, the same hardware can be used to test any of the standards like GSM, GPRS or CDMA by simply changing the software. In other words, PC is most likely to become the standard T&M instrument hardware in the near future with the integration of software testing tools into it.
These solutions are easy to configure (according to user requirements), use and also come at a lower cost. More than that, for example, National Instruments promoted the concept of 'virtual instrumentation', which allow users to design and configure their own instruments according to their requirements using software tools.
Portable T&M instruments: T&M companies are making handheld T&M devices with more functions and power. For examples, service providers can expect a growing number of portable analyzers that can meet the needs of burgeoning field applications. What is good about these instruments is that even though they are portable they are powerful and feature-packed. Also, many T&M equipment manufacturers are trying to harness the power and portability of handheld computers. For example, Noah Industries (Melbourne, FL) offers a fiber-optic power meter that ties into PDAs and provides graphs of the fiber's performance.
Realtime RF analyzers: Tektronix has come up with a new series of real-time spectrum analyzers that provides the ability to trigger, capture and analyze time-varying RF signals. RF signal characteristics are becoming more complex as RF communications increasingly replace wired technologies in applications ranging from inventory identification to video games. Today's RF signals carry complex modulation and change from one instant to the next, hopping frequencies, spiking briefly, and then disappearing. As a result, these RF signals are difficult to measure and present unpredictable behavior, making engineers' ability to observe RF devices with existing spectrum analyzers extremely challenging. This evolution in RF technology has spawned an unprecedented demand for a new approach to spectrum analysis. Realtime spectrum analysis has emerged as the vehicle to address this RF technology evolution.
Digital technology is becoming all-pervasive. Whether it is communication systems, control systems, radar systems or any other, almost all the analog blocks are being replaced by digital. This is bringing profound changes in the area of test tools that are required. Signal Analyzers are required to have digital demodulation capability while the signal sources are required to create signals with digital modulation formats. Mixed Signal Oscilloscopes and Logic Analyzers have become tools of choice for debugging digital designs.
Whether digital or analog, the designs are moving to increasingly higher frequencies. In the digital domain, in order to accommodate higher data rates, the signal buses are changing to "serial" from the traditional "parallel" ones. This brings new and unforeseen challenges for design engineers and manufacturers. Signal integrity has become a critical factor for the success of digital designs and we see traditional microwave tools like Vector Network Analyzers as being used to decide the robustness of design of the physical layer.
Induction of new technologies such as VoIP, MPLS, WLAN, UWB etc. demand suitable new design and validation tools.
The Market
The largest chunk of revenues for the communication T&M industry comes from the wireless segment. As wireless service providers led the investment in infrastructure, either through new network deployments or upgrades, their T&M requirements were also more. Within wireless, the growth areas were GSM/GPRS as well as CDMA 2000. Deployment of EDGE by several service providers in a number of circles also led to T&M spend. In the wireline space, growth came through the deployment of MPLS technology as well as some initiatives toward next generation SDH.
Some service providers made sizeable investments in test tools last year as they deployed new networks/technologies, while many others did not invest as much in T&M. In some projects where new technologies got deployed, the spend was quite high whereas some other service providers have outsourced network maintenance activities and are not investing on test tools separately. Handset repairs also attracted further investments from NEMs. Similarly, the R&D activity in wireless also witnessed growth.
Overall, the Indian communication T&M market is understood to have grown at a rate of 11%. Although this may not sound very high, it was almost double the rate at which the industry grew in the FY 2003–04. That year, the industry had grown at a rate of 5.6% to clock revenues of Rs 293.5 crore.
In the fiscal 2004–05, the communication T&M industry's revenues in India stood at around Rs 325 crore,
There are a variety of aspects that promise growth, right from testing link QoS related parameters to testing of devices like cable modems, set top boxes, and other terminating equipment. Roy Chowdhury says that with the growth in broadband network, large number of handheld tools will be required for the access network testing. There will be requirement for ADSL testers, fiber break locators, OTDRs etc. "Another interesting trend is the increasing tendency of broadband access going wireless. Wireless broadband technologies like WiMax, 3G, etc are all going to open up opportunities for T&M vendors," addes Pillai.
Trends and Drivers
The spending on T&M as part of the network costs is dismally low in India. While globally, the cost of T&M equipment is 5-8% of the total network cost, in India, the figure is as low as 0.1%. Indications are that the T&M spend will go up in the coming years. More so because the new service providers are still in the rollout phase. Companies are still seeing T&M investment as expenditure. However, in future, they will see it as an investment as they will be required to differentiate on quality, better customer service, reliable networks and increased productivity. Earlier, sanctions were a major hindrance in the growth and propagation of T&M. It must be remembered here that the major suppliers of T&M equipment are global vendors, primarily those from the US. And the easing of the US sanctions since October 2001 has enabled them to sell a much broader range of products.
Service providers bought spectrum analyzers, network analyzers, protocol analyzers, optical time domain reflectometers (OTDR), optical spectrum analyzers (OSA) and plesiochronous digital hierarchy and synchronous digital hierarchy (PDH/SDH) analyzers and handheld testers. BSNL and MTNL were the big customers and they will continue to remain as they expand their network further. Private GSM and CDMA operators too are a huge market for these products as most of them are talking about improving quality of their network. Further, the thrust today is on teledensity. As a result, the emphasis will now be on quality of services. So the potential market for T&M equipment is likely to scale up. The signs are potent now. Before deregulation, T&M vendors were totally dependent on the government type of projects.
Primarily, the L1 business dominated the T&M equipment. It meant bulk purchase of hardware where vendors had no choice but to quote the lowest. Things have changed now after the entry of the private sector and corporatization of BSNL. There has been rationalization in procurement. Another noticeable trend is in solutions. Large vendors are pushing solutions rather than boxes.
Challenges
The multiplicity of new devices connecting to the wireline and wireless networks as well as the functionality that they possess is truly astounding. The greatest challenge faced by the T&M industry is to be able to keep pace and to effectively give customers ways to test these new devices and technologies.
To manage the cost of telecom networks, many service providers are becoming extremely sensitive to each and every cost input due to which sometimes quality of tools is getting compromised. This needs to be addressed immediately so that the network can continue to deliver quality service. As customers become more familiar with technology, they would become more demanding and the only way out for service providers is to improve QoS. Shrinking life cycle of devices, components and hardware platforms challenge the test instrument vendors to provide longer support as preferred by customers.
The Way Forward
The way forward is definitely to bring about user defined functionality test and measurement equipment, and this is one of the unique features of the virtual instrumentation approach. It is imperative that the test instrument vendors keep pace with all these changes. In fact they have to always move ahead in close collaboration with the global OEMs/ NEMs so that they have the right tools available for validating the design of the next generation products.
From a hardware perspective, there should be a strong focus on driving the overall cost down by leveraging commercial technology in computing and semiconductor technology. From the software front, the way forward is to develop software that can abstract the system complexity of modern applications by providing a powerful yet productive means to test even the most complex and changing technology.
Testing systems based on the virtual instrumentation approach is clearly the path that the industry is taking. This type of a solution is acknowledged as the only way to effectively meet the emerging demands of modern test and measurement applications. Evidence of this is seen from the attitudes of leading manufacturers as well as consumers.
New value-added services from communications service providers and increased awareness among consumers about QoS and also about alternate choices will drive the investments in T&M. Software is playing a growing role in test applications. Sometimes PCs or laptops running applications software provide relevant data. For analysis and other details, the dependence is largely on software. In the area of large communications networks, performance management can't be done manually. Such needs are essentially fulfilled by software solutions.
Looking ahead, the spurt in subscriber growth also initiated the long awaited push to local manufacturing of handsets. Global NEMs and contract manufacturers have started operations or have announced investments in the direction. Also, once service providers have overcome the more immediate challenges of managing growth, they will pay more attention to reducing the total cost of ownership (TCO) for network equipment and that of service operation. This will lead to a higher spend on T&M, as they help reduce the TCO over the course of a network lifecycle.
Sudesh Prasad and Ravi Shekhar Pandey
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