With consultancy firm Deloitte expecting 700 per cent growth in IoT units in India, the Radisys deal can aid developments in this dynamic sector
Reliance Industries (RIL) has acquired US telecom software firm Radisys and this acquisition highlights the need and scope of revenue of carriers in nextgen services such as Internet of Things (IoT).
A move towards the IoT sector
The recent 90 per cent drop in data tariffs and about 60 per cent drop in voice tariffs has resulted in gross revenue fall of 8 per cent on-year to Rs 2.6 lakh crore in 2017. Thus, the telcos are drifting from core telecom services to emerging technologies and inspecting areas such as IoT and Machine-to-Machine (M2M).
According to Rohan Dhamija, head, India and the Middle East for consultancy firm Analysys Mason, the telcos are required to expand their offers of services beyond connectivity that form 20-25 per cent of the IoT value chain in terms of revenue. This implies potential participation in the IoT opportunities.
He also suggested that the need for investment and revenue scopes will increase as telcos move from connectivity to end-to-end solution provider.
Anticipated growth of IoT industry
Consultancy firm Deloitte has predicted the IoT units in India to accelerate by 31 times and grow from the current base of 0.06 billion to 1.9 billion in 2020. This may represent a growth of 700 per cent in terms of revenue, reaching $9 billion by 2020 from $1.3 billion in 2016. The government of India, too, is aiming to create a $15 billion IoT industry in India by 2020.
Counterpoint’s senior analyst Hanish Bhatia has advised that the IoT industry for telcos may grow in fields such as vehicle tracking, smart appliances, smart metering and surveillance and target retail, manufacturing, healthcare and automotive.
Competition on the rise
On the other hand, Bharti Airtel and Vodafone are also providing IoT services. Airtel has initiated several IoT projects at its Manesar network centre and has a prospective partnership with US telecom major Verizon. It is also establishing a new centre in Bengaluru to further IoT technologies.
Vodafone, which may partner with Idea Cellular, has reported IoT to be one of its fastest growing segments. Apart from launching a narrowband IoT network, it is looking forward to bringing global IoT use cases to India.
Acquisition for acceleration
The Radisys team will be headed by Aayush Bhatnagar, Vice President, RIL, who is presently responsible for the software development around areas including 5G networks and IoT platforms.
This acquisition can pave way for Jio to adopt open source technologies and develop 5G core and radio products. This can redefine applications in IoT sector and help RIL eventually support sectors such as healthcare, education, agriculture and smart cities.