“ISP Industry- Opportunities and Challenges”- Venkatesh Bhat, CFO- Atria Convergence Technologies

aIMG_1068

In a synergistic session with the students of TAPMI, Mr. Venkatesh Bhat briefed on ‘ISP industry, its opportunities and challenges’.

Mr. Bhat started off in a unique way by querying the students about their expectations of the session. He stated that any industry consists of various dynamics but his emphasis would be more towards the business rather than the technological part of ISP.

He joined ACT in 2008 when the company’s turnover was 30 crore.  He remarked that the company has transformed from a “cable” company to “data and cable” company and at present has a turnover of 1300 crores. He stated that today’s “ISP industry is a sweet-spot market” where management and customers alike are looking to get the best out of it.

He stated that expansion of mobile network coverage, increasing mobile internet adoption, urbanization and growing middle class, and increasing utility of internet has contributed to global ISP industry affecting 2.8 billion people. He asserted that lack of awareness, lack of relevant content and services, low incomes and affordability, user capability, and infrastructure have all acted as global barriers to ISP industry. The various internet connections such as analog dial-up, digital ISDN dial-up, DSL, Web-TV, and digital power line have helped counter these barriers. He explicitly mentioned how global usage has gone from 1% in 1995 to 35% now.

With the help of a TRAI report, he highlighted the change in Indian ISP industry from a mere 8 million subscribers in 2009 to 34 million in 2016 and an estimation of 40 million in 2017. Mr. Bhat continued to speak about the wired and wireless broadband network. He showcased a chart showing the subscribers for wired broadband network which showed ACT at 0.9 million, while those of BSNL, Airtel, and MTNL at 9.69 million, 1.79 million, and 1.1 million respectively. ACT, in partnership with India Value Fund Advisors, provides services in all the four southern states and has recently marked its presence in Delhi. He proudly stated that ACT, India’s largest and fastest growing FTTX broadband is able to provide the promised network speed to the users. This goes in tandem with the company’s vision- “To be the most admired in-home entertainment, education and interactive services company that creates radical social transformation and delights and empowers customers”. He emphasized that making customers happy and empowering them is the reason behind ACT’s success. He asserted that ACT was the first company to launch 5 Mbps bandwidth which is now extended to 100 Mbps- all this only by word of mouth.

Mr. Bhat listed unprecedented opportunity and cable TV transformation as the reason for ACT choosing ISP industry. According to him, Atria’s uniqueness to capitalize the opportunity has a lot to do with the top management coming from FMCGs and eventually redefining and creating a new process, making them the 2nd biggest private player after Airtel. As per ACMA report, 6.3 Mbps is the average global speed which has increased by 12% in December quarter, 2015. India stands at 114th rank with average speed of 3.5 Mbps which signifies a growth of 24%. Mr. Bhat stated that the constraint in this industry is on the supply side and hence helpful for the businessmen to tap into the industry.

Further ahead, he explained how MSO (Multiple System Operators) have technical limitations of high speed through the fiber-copper combination. Another challenge, particularly in India is the local cable operators. He listed the historic opportunities for this industry namely convenience, rise of digitization, internet enabled enterprises and internet of things (IOT). He listed the opportunities of growth such as 25% rise in usage every year, favorable policy regimes, consolidation and inorganic growth, value added services, and Wi-Fi hot spots. He also listed the challenges such as right of way, network creation and management, traffic management- such as select Google club, service issues- environment or deliberate cuts, regulation controls, Capex challenges, organizational build-up, and technological obsolescence.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s