What can be viable options for ICT industry to grow?

Right now in our country the ability of our planners to take decision for risky pursuits is getting
a little difficult because of civil and political system.But the fact is the time is running out fast as the
Industry is getting more important and critical ,both compared to oil and gas industry size,as well
as the mounting size of imports.The foreign exchange outgo is increasing and in next few years imports may as well touch 400 Billion $ in next fewer years! This is not a happy scenario both because of hardening $ as well as our limited exports for past several quarters.

There are the short term as well as more long term options which can be exercised as far as the ICT
Industry is concerned.We must liberalize and open the sub sectors for all types of investments-Global
as well as the Domestic entrepreneurs.We have to break up the industry hardware into three distinct
categories: Devices, Equipment and Complete Network and Systems.Both the Digital India and Make
in. India programs should be liberally expanded in the scope,so that faster import of FDI can happen.
FDI and its attended manufacturing rollout here will ensure on ground activity and capital formation.
As a target all states and the Deity must give eClearances for setting up both 100pct and less than 100 pct FDI participation.FDI must be tagged for 100 pct,if there is case of multi use of ICT in Telecom,Railways,Defense and Higher Research and Aerospace.A one page application for FIPB
should be done for immediate approval.There is no need for even waiting beyond user ministry vetting time.

Necessarily all these projects can be under various state Govt STP or SEZ schemes including the
Semiconductor projects.Certain state Governments have set up these projects on the basis of their own initiatives.More and more such projects should be encouraged so the investment from private
sector can pour in.If the systems can be imported into countries which will improve quality of public
infrastructure then these can be approved without delay.Such imports will help improve domestic
revenues and indirectly be helpful in paying off to Global vendors!

Human Resource Development is another area of concern in ICT industry in India.The industry can
tie up with Global professional Organisations and domestic vendors for ongoing supplying to the new
Organisations.This can be part of the initial application where the requirement of such skills can be identified and if any Visa needed to import the project manpower temporarily.Ease of doing the business should be both really easy as well as Simple.

We will discuss in next blog some more specifics as far as Defense Manufacturing is concerned.

In new Govt initiatives like Digital India and Make in India T&M is critical!

Role of T& M as the Capex involved in manufacturing test is very well understood by engg and finance teams overseen by operational management.As the factory organisation is getting more
complex than ever before, the activities which are around the core manufacturing become important.
Today for example the customized design prototypes and the Marketing Architecture influence almost 60-70 pct of manufacturing competitiveness of the organisation.

Since the two initiatives made by present dispensation impact the local services and local assembly and test infrastructure,the T&M used and T&M services leverage the hardware to come up with end solutions.Many of the states are undertaking Digital Solutions of eGovernance now mostly transferred to the Mobile.The Governance deals with the effective delivery of public services in a timely and accurate manner.This actually involves data capture and presentation and processing digitally to a GUI for public consumption.This means right T&M architecture of hardware and services.Lot of Public Delivery Services and Monitoring networks have to use T&M.

Actually all these digital network solutions use the intersection of IT , T&M and Communication devices and the network platforms.It is critical to incorporate the T&M professionals ahead of the conceptualisation and end user proposal.Which means integrated and strategic thinking on the part of Solution Architect and System Implementers.

We intend to invite comments on what kind of networks are being conceptualists today.If there is heads up on that information,this blog itself can give contours of the possible solutions.Likewise new age products planned under local manufacturing programs can be better managed with right Capex and opex involved.

Rapid Prototyping and superior T&M skills needed for Hardware Startups!

As India fever gets really going for high evaluation startups,we start wondering that if we are going to see the valuation bubble burst like Dotcom in late 90s.Is there a real development of technology,injection of real equity and is real value creation happening here.? Or there is lot of hype,hot money and Ho hoopla about online marketplace? These are some genuine questions and people with traditional mindset ,who look for RoI and established corporate principles critically look these startups gobbling unlimited money like anything!

Well there is another way we can look at these startups.Most and almost all are software types.Aggregators,Cloud exploiters and virtual world people are entering all sectors-from garments to real estate- and creating daily the companies we call "Unicorns" overnight.No of employees are not important the intellectual capital is.Everybody thinks they need to just go on expanding customer base by investor funds and platform efficiency.The interesting thing is the startups based on the hardware development are missing.Hardly 25-30 companies are involved in hardware compared to overall figure of 4000 or so.

Reason is very easy to spot.Hardware is hard.The ecosystem to support sourcing,components testing and inwards inspection,Rapid prototyping and testing/quality assurance is next to nothing here.Both Chinese tech cities and Taiwan traditionally cater to all analog/digital components and thousands of job shoppers doing subcontracting for any company.No doubt all mass markets of mobile etc are being nurtured by these centers.Contrast this with situation at home where neither testing infrastructure nor the quick protyping can be conveniently done.

For us the better bet will be to get hardware stuff done in China or some other less expensive place and seek customers in India.Design and conceptualisation can happen in India and we can get investors anywhere,for markets near here.Silicon valley Bangalore remains the best bet to us.Startup capital of India will be good for finding T&M infrastructure too,as the demand for rapid prototyping grows overtime.

Hopefully the modest hardware startups will also trigger need of niche T&M companies and their services!

Restructuring of Global T&M industry triggers new markets!

The Global T&M industry is going thru many unprecedented changes,particularly since the beginning of this decade.The factors causing the changes are both technical,product attribute changes and the commercial economics one too.The technological changes are happening both due to space miniaturization of components as well as the new modulation and multiplexing schemes. A good base
is framed what kind of T&M technologies are likely to dominate by mapping the Moores Law alongside these.

Instrumentation value adding started happening when automation to standalone instruments was done thru HP-IB and later other IEEE standards.Inthe late 90s the compliance and performance instrumentation and systems were evolved.Now of course in the current decade the Internet of things and newer generation 4G onwards will dictate the choice of new designs.

Accordingly the T&M software and services companies will have to closely work with hardware OEM companies and discover customized solution for these technologies.Because of so much froth
in the industry and merger and de mergers no body is certain who will survive or who will get to retain the umbrella brands.The game will be driven by the cash and market share accretive ess of these financial deals and there are limited target and acquirers in the mature T&M industry.

These developments happening since beginning of 2010 are giving continuous challenges as well as many latent opportunities to expand the size of the market overall.It really boils down to individual companies capability to restructure their product generation teams and arrange financial model to increase the T&M top line.

Let us keep a tight watch. Many interesting things will happen in this year itself.

Clearance of Defense Manufacturing will boost T&M in FY16 onwards

Finally under new Governments completion of one year is starting to show some actions on the ground.We are seeing that there is around activity on license to manufacture and assemble all kind
of equipment from aircraft to helicopters and also lot of strategic Electronics.Only today they have
cleared as many as 16 projects worth 613 cr of investment.All these startup activity will naturally
have the Capex and so T&M equipment investment of high tech variety.

Stat wise the Government seems to have cleared 73 industrial licenses compared to just 50 between 2011 to 2014 May.More importantly the technology content is lot higher and local manufacturing is emphasized.The period of licensing is bigger too and so liberal view is taken.

Foreign investment is allowed to be upto 49percent and exceptional cases to 100pct.Mostly up to 49
percent is very attractive in these tech cases.

I think the T& M companies have an opportunity to sit and discuss with the manufacturers the new range of manual and automatic equipment immediately.

Digital India and Make in India intersect at Tested in India for boost to T&M

We have earlier talked about manufacturing and design clusters in the Electronics and Semiconductors domain.The Government is taking big strides in going ahead with attendant investment in this effort.The idea is to derive deserving revenues for the industry by appropriate
Infrastructure and other ecosystem here.

Good amount of proposals have turned up for both normal investment and approvals have been given
For about 9000 crore.20 to 25 percent incentive is available on the capex programs in SEZ and non SEZ activity.Of course one has to seize of the derivative opportunity in manufacturing locally if we want to draw linkages between mobile population,attendant service revenues and what is locally produced between devices and networks.

The key to all sort of manufacturing will be our ability to produce Quality Equipment progressively
In India and bring down the cost compared with imported full fledged equipment and devices here.
A good amount of value engineering and economics has to be factored in so as to increase value intact.All aspects of design,engineering and sales/marketing have to be compared ahead of pure kit assembly and testing.So all aspects of land,building and power have to come in before a product is shipped out the door.

Testing the preassembly and assembled systems is the core manufacturing activity in manufacturing.
T&M equipment for manual and automated testers will be required in these clusters where Government is envisaging RS 65000cr of investment proposals.Lot of money will be spent on Capex.

It is our industry's job to keep tab on these closely and come up with Solicted and Unsolicited proposals to units located there for T&M.All the best.

Make in India and "Tested in India" create opportunities for FY16

A continuous thrust to produce the high technology IT and Telecom Network Elements and devices here in India is creating T&M opportunities in FY 16 and beyond.Whether it is local home grown mobile devices manufacturer or the Apple outsourcer Fox Conn all are curious about India.The chief reason being they want to operate as closely as possible to the 970 million mobile customer base as possible.There are at least 160 Smartphones connections and in equal numbers are the net connection users.Both the factors are helping the general aggregator industry-including e Commerce grow well here.Obviously we can see sliding price points and so the competitive local manufacturing as the time passes.

One of the possible outfall of competition locally is the proliferation of Eastern Manufacturers from China, Taiwan, and Korea in the consumer markets.This requires that the local authorities ensure the consumers better quality safety and competitive prices.A big quality test center becomes the pre requisite to ensure hardware,software and malware are tested and certified before shipping to the customers.The labs are to be supported by the user department and often funded by the telecom/IT entity overseeing them.

Malware/Spyware related testing is important for network elements and devices originating from China .Western manufacturers are slightly safe from that criticism because of long presence in telecom sector and their installed base.New upstart companies from China and also from Taiwan will face the initial hiccups and therefore a quality assurance setup supported by the parent telecom ministry will be helpful.Let us also ensure necessary test gear to check quality,safety and other standards are managed through these test centers.We derive good opportunities here to sell the T&M services and other hardware related to testing.Watch this space for more.