Never a case of too much
Prices are on a downward spiral, and network traffic keeps
getting heavier. It is not an easy task to quench an enterprises thirst
for bandwidth. by Anil Patrick R
The crucial links that connect the blocks which build an enterprise or hook
it to the Internet are still leased lines for the greater part. VPNs are being
snapped up by Indian businesses for inter-office connectivity, and these are
the next most popular options.
|Never a case of too much
Falling bandwidth prices
and the resulting options have been offset by increased enterprise application
traffic. Hence, Indian enterprises are demanding additional bandwidth.
Leased lines lead when it
comes to Internet access. However, the race is on between leased lines
and VPNs when it comes to inter-office connectivity.
Apparently, there is never a case of too much since more than
two-thirds (68 percent) of respondents believe that they will require more bandwidth
during 2005-06. The percentage of organisations investing in bandwidth and connectivity
during this fiscal (71 percent) is less than that of the previous year (79 percent).
The IS 2005 figures show that 90 percent of Indian organisations have already
made bandwidth and connectivity investments in the past. Therefore, the focus
now is more on upgrading and maintaining existing bandwidth and connectivity.
Because most existing locations are already connected, investments in new links
are largely limited to new or hitherto unconnected locations.
The demand for more bandwidth can be attributed to increased business growth
across verticals. According to M C Raisinghani, Vice-president - Technology,
Birla Sun Life Insurance, Increase in bandwidth is primarily due to rising
business volumes, especially in the BFSI segment. In our case, the industry
is new and the volumes generated are resulting in a need for more bandwidth.
Next come the reduction in bandwidth tariffs. Enterprise wide applications churn
out ever-increasing amounts of data that has to be carried across overburdened
networks. Sunil Kapoor, CIO, Fortis Healthcare, believes that todays enterprise
users demand information and it has to be accessible across units. Sharing
the information repository across the organisation is critical. People also
need information internally to make informed decisions. Online connectivity
(Internet access) is also de facto now, he says.
Understandably, the telecom sector leads the race with all surveyed organisations
expecting to consume more bandwidth this fiscal. The BPO and services verticals
follow with 92 percent and 77 percent of organisa-tions foreseeing increased
bandwidth requirements in this fiscal.
Of these organisations, 20 percent expect a jump of 1.6 to 2 times in 2005-06.
Another 20 percent expect an increase in bandwidth usage by 1.1 to 1.5 times.
Means of Net connectivity
More than 70 percent of organisations have invested in leased lines. ISDN comes
next with 50 percent followed by DSL at 32 percent.
BPO is the biggest user of leased lines for Internet connectivity with 96 percent
using it. 83 percent of telecom organisations use leased lines followed by 77
percent in services. Pharmaceuticals/chemicals happens to be the biggest user
of ISDN with 61 percent having opted for it. DSL penetration is highest in the
services sector with 45 percent of organisations having invested in it. Auto
and auto components follows with 39 percent favouring DSL.
54 percent of organisations that have or plan to invest in bandwidth are going
to opt for leased lines. ISDN follows with 27 percent and DSL comes third with
22 percent. Telecom leads with the entire vertical having leased lines on their
minds. Second in line is BPO with 88 percent. Then comes auto and auto components
with 66 percent.
We can expect DSL adoption to pick up, especially among medium
enterprises and regional offices of large ones. This is due to the recent entry
of heavyweights such as BSNL and MTNL with cost-effective corporate ADSL offerings.
The inner circle
- 68 percent of organisations are foreseeing
additional bandwidth requirements in 2005-06.
- In this fiscal, 71 percent of businesses
will buy more bandwidth.
- Leased lines (38 percent) and VPNs (37
percent) are having a neck-to-neck race when it comes to inter-office
On the inter-office connectivity front, leased lines have
a marginal lead over other options. 38 percent of organisations use leased circuits;
VPNs follow closely with 37 percent, while VSATs tot up 34 percent.
VPNs have been employed innovatively by Indian organisations. MPLS VPN technology
is used for remote connectivity. For instance, Fortis Healthcare uses VPNs over
DSL lines to link locations.
On the LAN side, gigabit Ethernet (GbE) is picking up with
19 percent of organisations already having deployed this technology. Explains
D S Nagendra, Country Sales Manager, PremisNet, ADC Krone, Organisations
are looking at gigabit Ethernet to the desktop since switches are available.
BPO and corporates are most interested in gigabit Ethernet. IS 2005 confirms
this trend with BPO leading the gigabit Ethernet brigade with an adoption rate
thats almost double the average at 35 percent. Services and oil/power
follow with adoption rates of 26 and 23 percent respectively. When it comes
to WLANs, the adoption rate is still low with 17 percent of organisations using
them. The telecom sector leads in WLAN usage with 66 percent using this technology.
Network this year
Leased lines and VPNs are head-to-head with 29 percent of organisations planning
to invest in these technologies during this fiscal. VSATs follow with 22 percent.
Birla Sun Life uses leased lines for inter-office connectivity. It will add
11 locations this year, and it plans to connect these to the existing network
using new leased circuits.
VPNs are a hot favourite for the BPO segment this fiscal with 54 percent of
organisations planning to invest in them. Pharmaceuticals/ chemicals and telecom
follow with adoption rates of 33 percent.
Steady growth seems to be on the anvil for WLANs with 16 percent
of organisations planning to deploy them this fiscal. 33 percent of telecom
companies plan to include this technology in their IT budget for 2005-06.
- It is the right time to go for leased
lineswith the substantial drop in prices.
- VPNs are a good option for inter-office
connectivity and remote access.
- It is better to restrict the use of VSATs
to specialised applications or remote locations.
- Deploy ADSL for Net access in branch offices
or for backup links.
- Gigabit Ethernet investments make sense
if you are setting up a new LAN.
- Adopt the faster 802.11g instead of 802.11b
when going in for WLANs.
Anil Patrick R can be reached at email@example.com