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Follow UsIn mythologies, both Indian and Western, we have had umpteen examples of remote control like in the Mahabharata, where Jayadrathas (the King of Sindhu who insulted Draupadi) life depended on solar positions that could be controlled remotely. In the modern times we often hear of remote controlled PMs or CMs. And in business parlance, we now have remotely managed IT infrastructure of enterprises, which is gradually becoming a trend.
The emergence of remote infrastructure management (RIM) has been helped by the fact that it cuts down not only service time, but infrastructure costs as well.
The RIM Potential
As an independent sector, offshore remote infrastructure management (RIM) has the potential to unleash the next large wave of outsourcing opportunity, similar to that provided by application development and maintenance (ADM) and BPO industries in the late 90s. According to a recent Nasscom-McKinseys report, titled The Rising Remote Infrastructure Management Opp-ortunity, the addressable RIM market stands at $96-104 bn, out of which $13-15 bn is likely to be contributed by India by 2013. Though, Indias share stands at a mere $3-4 bn currently. This growth in RIM will also result in the creation of around 350,000 additional jobs in the industry.
Regardless of the impressive statistics, would RIM too remain another offshore darling? Not really, if we listen to all the important stakeholders. The domestic RIM market too is growing significantly and is likely to attain a sizable scale in the near future. India was amongst the first offshore locations to leverage the RIM opportunity, and today it is well positioned to capture a big chunk of the IT infrastructure management market. But now many of these players have started looking homewards to check on the opportunities lurking on their native shores.
RIMs Domestic Avatar
The RIM industry is growing at 75% y-o-y globally. Although, the domestic market for RIM is slower than that, the demand is fast catching up to meet the global pace. The overall size of the domestic market for facility management should be around Rs 2,500 crore among which RIM contributes 15-20% at present, roughly Rs 400 crore.
In the last two years the domestic market for RIM has started looking up. Domestic customers are gradually accepting the process as they are getting comfortable with its security aspects, which is a primary concern when anyone takes control over the systems remotely, as well as delivery capability of the service providers through remote model, explained Kiran Desai, general manager and business head, Managed IT Services, Wipro Infotech, India and Middle East.
Previously, the remote model was meant for network management while other aspects like end user support, data center support, application support, etc, were not so active. However, as per the current trend, out of the total infrastructure management business, around 15-20% comes through the remote model and the rest happens through onsite due to customer reservations.
According to industry experts, this ratio of 20:80 is expected to rise to 40:60 in the next five years. Given that the domestic market is very active as Indian IT firms look for the IMS opportunity. Clients evaluate delivery capabilities based on the vendors network operating center setup. Infrastructure management is a critical issue and the entire network must therefore be ready for appropriate reactions. There should be operational and technological readiness to help businesses respond quickly to opportunities and react appropriately to unplanned events. The clients are looking for world-class service, support, and domain experts who work closely with internal teams to build comprehensive strategies.
The basic needs in an enterprisecost reduction, flexibility, focus on core business, globalization, and predictabilityare common across the globe. However, the scale, role, and priority may vary. Quality infrastructure standardization, proc-ess standardization, and skill-hubbing of technology are essentially the key criteria for remote management. If these factors are well controlled and processed then client management becomes easy.
With Indian tele-density on the rise, need for remote infrastructure management in telecom is huge. RIM is also in gaining traction in verticals like BFSI, manufacturing, pharma, and retail.
As per Desai, BPO is another key growth driver for RIM, and so is the manufacturing sector As business is becoming more IT dependent, this sector looks promising. Splitting the market share for RIM services, 70% will go to telecom and BFSI, 10% manufacturing, and the rest 20% to other verticals.
What India Wants
The traditional services offered by any service provider based on the remote model are server management, data center management, day-to-day PC maintenance, application management, storage, network, security, etc. However, in the typical Indian customer context, the fear for security threats poses a serious hindrance, as clients prefer someone to be present physically to resolve a problem. To assure our customers of secured remote model delivery systems we went through various security and quality assurance certificates last year. These kinds of third party audited certifications are very essential to win customer confidence, said Desai.
Indian customers have now become very demanding as far as quality of service delivery is concerned. Cost is no more the only concern. They generally look for 24x7 support, operational, and management services related to the applications, servers, systems, availability, and specialized services through remote models like data warehousing, business intelligence, etc, says desai As business dependency on IT is going up significantly, the customers have started to realize the importance of an effective remote service model. On the industry level, being the pioneers of this space, we are playing a leadership role by leading Nasscoms newly instituted RIM Forum which seeks to further strengthen Indias capability and positioning in this space, says Swapan Johri, senior VP, IT Operations, Emerging Services, HCLT ISD.
The basic needs in an enterprisecost reduction, flexibility, focus on core business, globalization, and predictabilityare common across the globe. However, the scale, role, and priority may vary. Quality infrastructure standardization, proc-ess standardization, and skill-hubbing of technology are essentially the key criteria for remote management. If these factors are well controlled and processed then client management becomes easy.
With Indian tele-density on the rise, need for remote infrastructure management in telecom is huge. RIM is also in gaining traction in verticals like BFSI, manufacturing, pharma, and retail.
As per Desai, BPO is another key growth driver for RIM, and so is the manufacturing sector As business is becoming more IT dependent, this sector looks promising. Splitting the market share for RIM services, 70% will go to telecom and BFSI, 10% manufacturing, and the rest 20% to other verticals.
There are two forms of remote management. The first is through the customer running his own operation in a customer owned NOC, for example, BPO customer. The other is through a service provider owned NOC. While for a large enterprise remote management requires dedicated or niche skill sets, for a SME client a more multi-skilled remote management resource is required. Telecom managed services are different from enterprise managed services, and are a big market in the Indian context. For enterprise managed services the requirement is different, said KS Ganesan, CTO, Microland.
There is also the matter of data privacy when an enterprise infrastructure is managed remotely. Depending on the industry type, different models of remote management are accepted. Currently the most popular are management of helpdesk (standard desktop support depending on the industry), managed network services, and managed security services. The fourth model of remote service, which has started to create a lot of buzz in the domestic market, is remote management of mail and database administration.
Next-Gen Challengers
As mentioned earlier, the yet to be explored potential of RIM is lucrative enough to attract not only the traditional biggies, but smaller providers as well. Indian vendors have increasing scale and maturity, deep customer relationships, and access to sound technical infrastructure. Rapid evolution in technologies, changes in demand patterns, developments in the vendor and offshore supply environment are the three independent forces that continue to accelerate RIM adoption. RIM is a service requiring sophisticated tools and high customer confidence and relationships. The Indian IT industry is moving toward becoming a fully integrated service provider by increasing RIM services.
V Murali of Chennai-based Precision Infomatic, expects the RIM market to grow at a tremendous pace and the potential to be about $12-14 bn by 2011. And the Indian companies are getting ready to handle the infrastructure services opportunities comfortably. The Indian model on RIM is evolving as compared to the matured US model on infrastructure services. Therefore, this new venture would be an extension of our success in the software field, says Murali. At present the company is working in the Middle East and US markets. And with the support from its parent company, Info Drive, Precision would provide services on desktop, server, and network management for domestic as well as its global customers.
Delhi-based Team Computers is in the business of uptime assurance to clien. By having RIM as a service, Team will be able to provide high value at lesser price to its customers. We are setting up the NOC for our customers, and our engineers in the NOC are monitoring customers IT assets proactively. In services Team is providing remote desktop/laptop monitoring, server monitoring, network monitoring, patch management, security management, and proactive and reactive support, says Ranjan Chopra, MD, Team Computers.
Piyali Guha
piyalig@cybermedia.co.in