What are your expansion plans in India?
VSATs are one of the fastest growing broadband mediums in India. Connectivity has emerged as a key enabler for both business and Government to deliver services to this growing section of society. Broadband penetration in India hasn’t picked up in proportion to the growth of mobile subscribers and still vast areas remain un-served, presenting a huge opportunity for satellite operations .Hughes recently Hughes had inaugurated a Rs 25-crore Hyderabad hub to increase the SMB focus in the near future, we plan to expand in the following areas Distance Education, e-Governance and Common Service Centres, Defense Solutions, Rural internet and kiosks, Broadband Access through Satellite and Media segment.
How do you handle the pricing pressure which is faced by the VSAT industry?
Continuous Differentiation and Innovation are one the key growth drivers of Hughes. Factors that play a major role for Hughes in dealing with the price challenges include OEM-cum-Service Provider (one-stop shop) long-term engagement/stability, In-sourcing of Field support and engineering services, Alliances and business partnerships, Market leadership – First to enter, develop a new market segment (Examples are e-Learning, Digital Cinema, Retail, Financial Inclusion, e-Governance), Add more value to the customer for the same price and Good Cost Management.
How superior is your products and services as compared with competition?
Hughes is the inventor of VSAT and global market leader in the VSAT industry the products are highly differentiated and advanced technologically. Hughes spends a lot in R&D and engineering resources, that it can afford to as THE Industry leader.Services are differentiated through innovation different bandwidth models, enhanced support for customer applications, higher SLA for uptime, better performance of end user response times of the network.
What are your innovations and initiatives to tap India’s rural markets / projects of your customers?
We are very focused on Markets/Services that bridge the digital divide”, and help bring inclusive growth to the economy. VSATs are a natural fit for rural markets.We have innovated and pioneered various initiatives in the Rural markets, namely ITC e-Choupal, e-Governance services through Common Service Centres, making rural cellular services available from Cellular backhaul to Reliance/Vodafone/Idea, making rural retail viable through Haryali Kisan Bazaar, health monitoring/surveillance through Ministry of Health, etc.
We have established our own Rural/Kiosk initiative called Fusion” where we have setup over 400 of our own retail centres and over 7500 CSC Centres to provide citizen services like e-Governance, e-Learning, internet access, vocational training, railway ticketing, etc.We also provide subsidized broadband access services for un-served and under-served markets to help proliferate broadband access via satellite in these markets.
Will 3G / 4G affect your business in India?
3G/4G are likely to be mainly rolled out in the top 80-100 cities in the country. These are not typically VSAT markets and hence we don’t expect any significant impact to the VSAT sector. Globally too, 3G/4G services rolled out in North America and Europe have not impacted the VSAT sector.However, Hughes does provide other networking services other than Satellite. One such service is our Managed Broadband Service wherein we integrate the best of broadband technologies like DSL, EDGE/EVDO, WiMax across multiple access providers like Airtel, BSNL, Reliance, Tata and provide a single window solution to the Enterprise customer to harness the power of broadband to the Enterprise. With the advent of 3G/4G, we will be able to integrate this exciting urban technology and incorporate it in our Managed Broadband portfolio.
Also, Hughes provides terrestrial optimization solutions for Cellular backhaul optimization of Urban circuits. With the advent of 3G/4G, there will be a dramatic increase in bandwidth utilization on Urban backhaul links between BTS-BSC, BSC-MSC and MSC-MSC. Hence our Cellular backhaul optimization solutions in partnership with Memotec, can leverage this opportunity very positively.
What kind of support do you expect from government in India?
The Government can provide favourable policies for growth of our business. Some of the immediate policy/process changes would include availability of USO funds for VSAT-based rural services, reduction of revenue share/service taxes for services in rural areas, permitting smaller antenna size (0.74m) for Ku-band as per international norm, permitting open skies” for free access to satellite transponders, simplifying the complicated approval process for satellite-based Cellular backhaul links, creating a practical process/framework for Security-clearance”.
What are the unique demands of your customers?
Customers demand ever higher performance, SLA at lower costs and zero downtime”. Customers also expect VSATs to be installed within 3-4 days of providing an address. Customers expect a managed-service and single price per site per month for all services to be delivered to the site simplified billing and integrated service offering.
What are your new initiatives to meet the demands of finance and education verticals?
Finance Vertical is a very exciting for Hughes. Today we have close to 19,000 sites connected over 10,000 branches and over 8,000 off-site ATMs belonging to various nationalized and private sector banks.We are currently rolling out a further 8000 branches for various Regional Rural Banks that will provide financial inclusion services in the under-banked areas in the country.
A huge off-site ATM/Kiosk rollout is also underway, that will see a deployment of 25,000 ATMs in the next 3 years in the country. We are playing a key role in this deployment using our unique small-VSAT technology. We are also partnership various ASP providers in providing core banking solutions to smaller banks and co-operative banks, through managed service/outsourcing models.
Hughes has a much bigger play in the Education Vertical as we run our own Education business (as opposed to providing networking solutions in the Education space).We plan to expand our premium education services very significantly partnering with more management institutes, expanding to premium technical education, expanding to more overseas markets like Malaysia and Middle-East, customizing programs to Corporate customers. We also plan to work in vocational and non-premium areas partnering with various Govt. programs like NSDC and CSCs.
We also will expand our Cloud Computing service Interactive Onsite Learning”, which is an application available on a usage basis for enabling e-learning over a wide area network.
What are the new trends?
Customers want total outsourcing and managed services with the Network bundled into Cloud-based applications. There is an increased push towards rural networks and inclusive growth many projects across various sectors are coming up. 100% Uptime” is making the Backup link as important as the primary link. ISDN has become an obsolete technology making VSAT the natural fit for Backup applications. Government state departments are not ready to wait for SWAN rollout and stability and hence are coming up with their own RFPs for Infrastructure and Services. High-capability VSATs for niche segments like Military, Police for applications like C4ISR/Surveillance/National security, which have features like High-speed Mesh, Mobility support for on-the-move applications.