Cisco's revenues inch closer to $1b mark

As Cisco, the world’s largest computer networking equipment maker, approaches around $1 billion in revenues from India, the company is hoping that increased government spending on technology will keep the momentum going.

Cisco has already won three contracts awarded by State Electricity Boards (SEBs) for computerization, each being worth around Rs 200-500 crore. These projects are part of the government’s bigger agenda for computerisation of the power sector by investing nearly Rs 10,000 crore.

"Government and PSUs were the top revenue earners for us, replacing IT services customers who were the biggest until slowdown happened," said Naresh B Wadhwa, managing director of Cisco India. Cisco also won the networking portion of Rs 1,200 crore ESIC contract along with Wipro.

Cisco does not give out its revenues from the Indian market, but according to Voice and Data, the company’s India revenues were around Rs 4,500 crore last year. "There are many markets that are still in the making, such as traffic management, water management and security. Transport is also a big opportunity," said Mr Wadhwa.

An expert tracking Cisco’s Indian wins said many tenders specify Cisco switches, which works to the company’s advantage. "Some of the tenders specify Cisco switches instead of a more generic specification," he said.

Some of Cisco’s competitors for high-end services are Nortel and Avaya and in networking, switches players such as DAX and Chinese vendor, ZTE. "Nortel’s filing of Chapter 11 has not impacted its business in India much and large firms such as Reliance continue to use its products," the expert added.

Cisco is also participating in state-wide area network (SWAN) contracts for wiring state and district headquarters in Gujarat, Punjab, Haryana, Tamil Nadu, Jharkhand, Sikkim, and bidding for contracts for setting up state data centres (SDCs).

Around 18 states are coming out with tenders for setting up SDCs. Mr Wadhwa expects that following SWAN contracts, there will be contracts to network with state departments like revenue, police and health. "Once you have the infrastructure, you add more applications and keep building on top of it," he said.