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'SMEs will take to cloud before big companies'

March 09, 2011 12:10 IST

The India arm of the €50.9-billion, France-based, Orange Business Services (OBS), offering integrated communication services, is looking at quadrupling its sales in India over the next five years.

Bala Mahadevan, CEO, OBS India, outlines plans for growth, current strategy and insights into the burgeoning cloud market.

What is the scale of your operations in India?

We have three types of business in India - global multi national companies (MNCs) who have signed up with Orange, what we do in India itself for global MNCs in the networking space and, third, the SI (systems integration) business.

There we provide collaboration solutions, such as CRM, and work with companies such as Avaya to provide voice solutions.

In all, we have about 2,500 employees in India, and are looking to quadruple business within the next five years. The workforce strength will grow correspondingly.

What are your plans?

We are looking also at multiple sectors. There is an opportunity to go broad-based across verticals. This would mean working closely with partners.

Once cloud takes off, we would be a major player. We are exploring further and larger partnerships with major telecom players like Tulip and Bharti, because we do not lay fibre in the country.

Is there a change from services to a consumption model in the information technology industry?

While the consumption model is not entirely new, there are three things driving the change and impetus to consumption.

The expectation of CEOs from the IT department, whether in-house or outsourced, is no longer to steady sales and cut costs.

The idea today is that there are dynamic changes in the business and IT is supposed to aid this change.

From a dichotomy between global and local, the emerging trend is 'glocal'. There is also the extension of supply and demand chains to an extended ecosystem.

The force driving all of these changes is the new workforce, which I think will alter things dramatically.

How does cloud change things?

The demand pattern will change. Cloud will increase demand for traffic, it will help bring network and IT together more than any other thing, given the fact that it will change the very manner in which IT is delivered.

There will be demands for select sets of customised applications. The IT dept will become the user as well. It will become the provisioning agent.

Cloud has not yet caught on in India. The drive towards private cloud will be more than the public cloud because of security concerns.

Also, despite the entire buzz, it will be impossible to put everything on the cloud. While a boom will happen, the boom will be veered largely toward small and medium enterprises (SMEs).

Why is that?

SMEs typically do not run in 100 countries, with large IT landscapes, being regulated by different laws.

So, adoption of a cloud for the whole business for an SME is easier and more practical than for larger enterprises.

Also, where cloud is concerned, what is interesting is that companies across the network, software, and hardware, OEM and security companies have cloud strategies. Companies like Orange, which are network providers, would be cloud aggregators.

What is the potential of the cloud market?

Numbers vary with research. One report states that the market will reach $1 billion from the present $100 million, which means a 10-fold increase over five years, as opposed to a global market which will reach $100 billion.

Software as a service in cloud computing will go up to $650 million by 2015. The first to go on the cloud, however, in India will be data storage, followed by back-up and infrastructure as a service, because regulatory mechanisms show that data needs to be stored for longer periods.

Data virtualisation will also take place. The ultimate goal will be everything as a service - XAAS, where X stands for everything.

What is Orange's target?

We are focused on enterprises, both domestic and MNCs. Our play is that of cloud aggregators. We have our own data centres as well as those of partners.

We have new offerings that would help enterprises determine how ready they are for cloud, which is in essence a cloud-study service.

We also can help bridge the gap between the public and the private cloud, which would be operated in a hybrid manner, using Orange's private cloud.

We have a private applications store, which would give users a customised catalogue of These applications, however, have to have the ability to work on any platform. We would services.

be able to provide end-to-end management provisioning in the long run.


Swati Garg in Kolkata