Rajesh Tuli
Managing Director & CEO,
Coral Telecom
Digital Communication Innovation Square (DCIS)
It is an initiative under the Champion Services Sector Scheme of the TCOE (Telecom Centre of Excellence) India aimed to foster innovation and domestic design capabilities in telecommunications industry. Scheme is designed to not only mitigate potential fiscal risks for small companies by extending “Grant in Aid” but scheme also helps address commercial risks by encouraging “consortium approach” to quickly build solutions that end customers require.
This is unique, since no other government scheme has extended “Grant in Aid” for R&D to private sector companies. It is well known that innovation starts in small companies thus TCOE India’s role in harnessing the potential of small companies is of great importance in nation building. Under this umbrella, Govt encourages and nurtures innovation in digital communication at the grass root level for MSMEs.
This blog highlights the invaluable contribution of Department of Telecommunications initiated DCIS scheme in ensuring the survival and success of these small companies, which may have otherwise faced the risk of shutting down R&D or even closing shop. Coral my company has been used as an example to highlight the issues.
Introduction
The telecommunications sector plays a vital role in shaping the digital landscape of any nation. Lack of control and ownership of telecom technology can be a potential national security risk as it powers digital highways that enable data transmission to render digital services for citizens as well as to maintain command and control of the Government. In the present era robust telecom network is the mainstay for all economic activity that collectively leads to employment creation and consequent GDP growth, hence control and ownership of this technology is vital for India to attain global supremacy.
With the rapid advancements in technology and the growing importance of digital communication, it has become imperative for countries to nurture their domestic design capabilities in the telecom sector that directly impacts National security and sovereignty.
Role of TCOE India
“Customers don’t buy sub-assemblies or modules” they need solutions to address their functional needs or requirements.
Early enough TCOE India recognised that MSMEs develop technologies or sub assemblies that customer does not buy directly hence before technologies can be monetized these companies either fall prey to large corporates who acquire them or they fall into oblivion for lack of commercial revenue streams. TCOE India scheme made this significant difference to the MSME design efforts where it took special interest in fostering “Consortium based approach” to build and integrate products & convert them into commercial solutions.
Thus DCIS, not only provides fiscal support but also helps create a conducive environment for domestic designers, engineers, and innovators to collaborate, exchange ideas, and develop cutting-edge solutions that meet the evolving aspirations of the buyers.
TCOE India actively nurtures interactions with academia and facilitates use of expensive test and laboratory infrastructure available with some strategic Government labs thus reducing costs for MSME.
Financial constraints often hinder the growth and sustainability of domestic design companies. DCIS addresses this challenge by offering financial support through “Grant in Aid” which was never before given to private institutions.
The financial backing provided by DCIS acts as a catalyst for innovation and ensures the survival of domestic design companies in a highly competitive market. “Grant in Aid” program addresses the risk associated with product designing and enables companies to invest in research and development, recruit talent, and compete with established global players in niche areas.
R&D is an expensive hobby
It is a difficult passion to pursue & sustain in India & more so in MSME segment. It’s for this reason not many MSMEs pursue this path and opt to remain traders or system integrators.
Rapid Technological Changes: The telecom industry is characterized by constant technological advancements and evolving standards. Keeping up with these changes requires significant investments in research and development, skilled manpower, and infrastructure. For a company like Coral Telecom, the pace of technological advancements posed challenges and made it difficult to keep pace with market demands.
Risk Appetite: Developing new products and solutions in the telecom sector often involves substantial risks. These risks include market uncertainties, potential regulatory changes, high competition, and the possibility of technology obsolescence. Coral Telecom, considering its risk appetite and market dynamics, had decided to allocate resources to other business areas rather than continue domestic design efforts.
Time-to-Market Considerations: In the fast-paced telecom industry, time-to-market is critical. Developing new products from scratch through domestic design can be a time-consuming process, especially when compared to leveraging existing technologies and solutions available from global vendors. In an era of fast changing technology where technology changed much before company could monetize and recover investments made in earlier version of technology, coral had no option but to opt out of the technology race.
Cost and Resource Allocation: Domestic design efforts often require significant investments in research, development, talent acquisition, and infrastructure setup. Careful evaluation of the cost associated with domestic design versus the potential returns favoured “System integration” and trading hence a few years ago Coral took conscious decision to switch gears. Decision to forego domestic design was not driven by lack of innovation or commitment but on account of its inability to monetize domestic developed technology before it became obsolete.
Coral’s experience
In 1991, Coral embarked on domestic designing of telecom products & successfully developed several products that gave it a market leadership position in PABX segment. It forged strategic partnerships with leading research institutions, start-ups, and technology providers. These alliances allowed the company to leverage the expertise and resources of external entities while enhancing its own capabilities. Coral successfully steered its products from carrier switching to Digital and then IP based platforms. This provided Coral an edge in the enterprise communication segment and by 2010 it had build revenue streams exceeding Rs 150 Crore per annum.
Company did very well with legacy telecom technologies till 2012 but in this fast changing technology where markets were opened up for global players, Coral experienced tough competition where price points were, for ever, coming down since global players enjoyed “economies of scale”. Coral as a company lost heart and was cutting down on its investments on R&D efforts.
Since 2010, pace of technology change was sharper as telecom moved from wired to wireless domains and then technology made swift moves from 2G to 3G & very soon moved to 5G. Telecom and IT technologies amalgamated and with advent of 5G, Internet of Things (IoT), Machine to Machine (M2M) and artificial intelligence (AI) technologies became flag bearers.
Coral had lost steam since it could not match the resources required to keep pace with “technology change” from monetization of already developed technologies.
This is when TCOE India came in as a big saviour.
TCOE India supported Coral like other shortlisted companies in migration of enterprise communications from pure voice switching to Unified communication platforms that included voice, video & data. Similarly media was transforming to include optical fibre and wireless technologies. Telecom switching platforms were changing protocols from SDM & TDM to Omni present IP highways. What looked as a herculean task to catch up for Coral started looked within reach with the support of TCOE India. Catching up with technology looked commercially counter productive since 2010 and coral reduced its R&D team from 250 people to a tenth by 2020 when TCOE India acted as a catalyst and Coral R&D started work with a renewed vigour.
With renewed vigor, Coral Telecom launched a series of ground breaking new technology products that garnered industry recognition and market acclaim. These products ranged from advanced 5G network solutions, IoT-enabled devices, to AI-driven customer experience platforms. Through their innovative offerings, Coral Telecom not only regained its position as a technology leader but is also expanding its customer base and market share.
There are many companies like Coral Telecom that can drive innovation but required the much needed support handholding and guidance since alone these small companies cannot withstand the might of big multinationals. TCOE India bridged that gap
The culture of collaborative work between DCIS awardees, ensures that stakeholders from various domains, including academia, industry, and government, work together towards a common goal. This collective effort not only enhances knowledge sharing and fosters a culture of innovation but also help identify and address specific needs of the market. Revenue streams from such commercial solutions is expected to fund further R&D and build self-sustaining domestic design ecosystem.
Driving Business Success
The implementation of TCOE India DCIS scheme brought in significant positive changes in Coral’s business operations and overall success.
Coral Telecom embarked on a transformative journey that involved re-evaluating its business strategy, reinvigorating its research and development capabilities, and once again fostering a culture of innovation within the organization.
Thus DCIS not only helped Coral restart its R&D efforts but it also helped navigate risks more effectively by helping build collaboration with like-minded domestic players. The guidance and expertise offered by DCIS helps domestic design companies develop strategies to mitigate potential pitfalls and seize emerging opportunities by building relationships with large Government buyers.
Coral is on a recovery path but it is a long journey that TCOE India must support with the backing of the Government.
Conclusion
Coral’s implementation of TCOE DCIS has been a game-changer The seamless multichannel support, real-time engagement with buyers, and desired policy interventions with Govt, help make the course correction. By shifting gears, rekindling their innovation spirit, and successfully developing new technology products, the company looks forward to transform its fortunes and once again regain its old glory of being a champion in enterprise communication segment.
The Digital Communication Innovation Square (DCIS) has emerged as a crucial catalyst for the survival and success of domestic design companies in the telecom sector. Through its support programs, access to resources, skill development initiatives, financial assistance, and risk mitigation strategies, DCIS has transformed and the motivated these companies to continue their quest for innovative solutions
But there is a long way to go and DCIS supported by Government must continue to support and handhold such successful design companies since journey cycle is long and they are still far from achieving profit streams for self-sustaining R&D ecosystem. By nurturing innovation, driving collaboration, and enabling self-reliance, DCIS has so far ensured that domestic design companies thrive, contribute to economic growth, and continue to innovate in the competitive world of telecommunications but it has to be sustained for some time otherwise all the good work done so far, will run the risk of going down the drain.
Way Ahead crystal ball gazing for government support and further prescriptions if any
While it’s challenging to predict the future changes in fast changing technology especially in a rapidly evolving industry like telecommunications, a few areas that could shape the future and require focus & support of TCOE are as follows
- 5G and Beyond: The rollout and expansion of 5G networks will continue to transform connectivity and enable new applications. As 5G matures, areas that would require enhanced focus may be autonomous vehicles, smart cities, remote healthcare, and augmented reality. Building AI based orchestration layers over 5G would be critical as we move forward.
- Internet of Things (IoT): The IoT ecosystem will continue to grow, connecting an increasing number of devices and enabling seamless communication between them. This connectivity will drive innovations in sectors like smart homes, industrial automation, agriculture, and healthcare driving efficiencies and making life secure with regular alarms for any deviation from the standard.
- Edge Computing: With the proliferation of IoT devices and the need for real-time processing, edge computing is poised to become more prominent. By moving processing power closer to the data source, edge computing reduces latency and enables faster decision-making.
- Artificial Intelligence (AI): AI technologies, such as machine learning and natural language processing, are likely to play a significant role in enhancing telecommunications services. AI-powered virtual assistants, network optimization, and predictive analytics will improve customer experiences and work efficiency that will make our lives comfortable and take away the all the repetitive mundane and dirty tasks.
- Cybersecurity: As technology advances, the importance of cybersecurity will increase multi-fold and national security and sovereign supremacy will become contingent on success in this area. Data security as well as citizen privacy concerns will become paramount and this will become a major focus area for TCOE India.
Neuromorphic circuits that mimic the structure and functionality of the human brain’s neural networks will be the future thrust area that will mean extremely low power consumption, real-time processing, and efficient parallel processing. - Quantum Computing (Qupid): Quantum computing leverages the principles of quantum mechanics to perform computations that are beyond the capabilities of classical computers.
Government support to TCOE India will play a critical role and Govt will have to not only sustain support to successful awardees of the scheme but also encourage emerging bright spots in Indian design and technology development to take up aforementioned futuristic technologies. As the technologies become more complex, risk factor will increase thus demanding multi fold increase in support & handholding by organisations like TCOE India.