Home > companies > Raju Vegesna | We are sharpening our focus on ICT

Mumbai: Over the past five-six years, Nasdaq-listed Sify Technologies Ltd has been transforming itself from a consumer-focused Internet services provider (ISP) to an enterprise-focused firm. This, according to chairman, managing director and chief executive officer Raju Vegesna, required reorganizing the firm’s business in the first half of 2011. Headquartered in Chennai, Sify now has three business units—enterprise services, commercial and consumer services, and software services.

Opportune moment: Vegesna says most of the innovations come when the economy slows. By Hemant Mishra/Mint

How has the recasting of your business operations worked for you?

When Sify was founded in the late 1990s, we were a typical ISP player. When I took over in 2006, we shifted focus to the enterprise segment. We are now sharpening our focus on the ICT sector to take advantage of the convergence of telecom and IT services. This is our plan for the next five years.

The cloud (Internet-based services) plays an important role here. We have invested around 400-500 crore in the last three years to improve our network and data centres. We plan to invest an additional 400-500 crore in the next three years in the ICT sector, even as we continue our network expansion along with a plan to set up three more data centres (to take the total to six) in this calendar year in Noida, Mumbai and Chennai.

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Raju Vegesna talks about the future of cloud computing and why small and medium enterprises are important for Sify

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How does the Mumbai cable landing station fit into your overall plan?

You may compare a cable landing station to a shipyard. With the opening of this landing station, Gulf Bridge International becomes the first to land its sub-sea cable system in India. We can accommodate up to four cable systems.

With a capacity of up to 10 terabits per second on certain cable sections, this system is designed to accommodate the rapid growth in voice and rich media traffic (Internet, telephony and video) originating from and terminating in the Middle East, as well as the African and European markets.

Our prediction is, in the next five years, cloud services will take over more than 50% of the total IT spending globally. With our ICT vision, which includes this landing station, we hope to play a big role in the next four-five years which will take us to the next level. We are not just talking of cloud services for enterprises but also for small and medium enterprises (SMEs) in India.

What model have you adopted for SMEs?

When it comes to SMEs, it is based on the usage model, which is why cloud services will suit them since they find it difficult to invest in fixed assets.

Is the slowing economy a matter of concern to you?

Like others, we, too, are exploring ways to reduce costs. IT creates opportunities, but we need to change the game. We need to think about cloud services and usage models. Most of the innovations come when the economy slows.

But you are still making losses...

In our industry, we have to invest money. Our business is like a network, we have to expand the network, and expand the data centres. We have to keep investing in the infrastructure.

The fact is that we are operationally positive and we will keep investing. We have very good cash flow. We have promoters, including myself, who invest in the company. We will be continuously investing in the company. At this point, the story in India is investment in IT.

As an ISP, you host a lot of data. What are your views on the government’s move to clamp down on third-party service providers for offensive content?

From my perspective, these (moves) make a lot of sense. We are very disciplined and have license-based products. We are listed on Nasdaq. We respect and follow all international standards.


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