Tata Communications, the telecom unit of Tata Sons which looks into enterprise, cloud and security solutions, has earmarked a capital expenditure (capex) of $20-25 million (Rs 130-160 crore) for its overall cloud business for the coming calendar year.
“Overall, cloud market is anywhere between $200-250 billion,” said Srinivasan CR, senior vice-president, global product management and data centre services, Tata Communications. “If you look at India, the market (cloud) would be anywhere from $1.5-2 billion, which includes infrastructure, software and platform services.” He pegged the growth of this business in India around a compound annual growth rate (CAGR) of 30-32%, on a par with other emerging markets growing at a CAGR of 30-35%.
“All these markets are growing because cloud is in the heart of digital transformation. 80% of the companies in the world are going through some kind of transformation, somewhere the journey of digital cloud is growing,” added Srinivasan. The investment will be used for geographical expansions, newer technologies and providing a range of services from where customers can pick and choose what they want.
Tata Communications, which is the cloud provider for the Indian government’s e-marketplace, is also working on several smart city projects, since these places will generate a lot of data.
“In India, there is a lot of momentum around cloud and cloud requirements because of all the smart city projects and government initiatives, so we want to be part of that,” said the senior VP. His team is working with the ministry of electronics and information technology (MeitY) to get its cloud accredited for Indian requirements.
“We also have plans to set up a government community cloud, because as we win more and more government projects, we want to put them in a government community cloud, which means that only government customers will be there,” said Srinivasan.
Tata Communications will have to compete with global players like Microsoft, Amazon Web Services and the just launched Google’s cloud platform for clients in the home turf besides warding off other domestic players to get more projects.
The company that has its cloud business across 13 global locations is in talks to buy the enterprise business of Tata Teleservices after the latter announced its decision to merge its mobility business with Airtel. According to an earlier ET report, Tata Communications has appointed Axis Capital as its investment banker for valuations, as it looks to consolidate its market position in the enterprise segment, strengthen its core network resilience, reach and cross-sell services.
The company employs about 100-150 engineers to create technologies around cloud and another 200-250 look at the operations side of the cloud business.
Source: Economic Times