Cisco eyeing 4G deals with new financing models

Thomas K Thomas New Delhi | Updated on November 18, 2011 Published on November 18, 2011

Ropes in Cisco Capital for funding

US equipment major Cisco is in talks with 4G operators in India for managing their IP networks and is exploring new business models, including the Build Operator Transfer scheme. The company has also roped in its financing arm Cisco Capital for offering funding facility to service providers.

Speaking to Business Line, Mr Sanjay Rohatgi, Senior Vice-President, India & SAARC – Service Provider, Cisco Systems (India) Pvt Ltd, said, “Cisco is looking to offer its Indian service provider customers, managed operations for IP networks and is willing to explore the BOT model with selective customers based on their business requirements.”

“With the spending shift from capital expenditure to operation expenditure in the service provider segment, through Cisco Capital (Cisco's leasing and financing arm), we are gearing up to customise business models based on requirements of individual customers by offering operating lease, finance lease as well as a ‘pay as you grow' model for the customers across the region,” he added.

By doing so, the company is hoping that it offers a unique proposition to its prospective clients in the wake of competition from the Chinese vendors.

With most of the big telecom operators planning to launch 4G broadband services, the IP market will be hot over the next two years.

LTE technology

4G networks, based on Long Term Evolution (LTE) technology, are expected to be built out by 2015. Cisco is hoping to get at least half of this market.

Mr Rohatgi said that apart from the wireless networks, the company sees huge opportunity in IP-based next generation networks.

“Switching has been our core strength. We are excited about the National Optic Fibre Network being rolled out by the Government. We are providing our inputs on how best to build this network and on getting the right business model,” he said

Another area where Cisco is upbeat is in the area of collaboration and cloud. “Our differentiation is that we want to be the cloud enabler unlike our competitor who wants to offer cloud services on their own. So they compete with service providers while we enable operators and not directly offer a service to end users,” said Mr Rohatgi.

As a result of all these new opportunities the technology major, which has been growing its revenues by 30 per cent according to industry sources, is now looking to double its growth in the service provider vertical over three years.

Published on November 18, 2011
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