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Peripherals Special: UPS
Branded players shine in Indian UPS market
Branded UPS players are gaining market share by playing the
value pricing and localisation card, says Abhinav Singh
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Enterprises need to look beyond the UPS and should
concentrate on properly designing the physical infrastructure of their data
centre, says Anand Iyer |
With the PC market breaching the three million mark in 2003, UPS vendors have
benefited. Vendors observe that the connect ratio of UPS with PCs has gone up
to 60 percent in the last three to four months. In other words, for every 1,000
PCs sold nearly 600 UPS were also sold in India. The ITeS sector and data centres
in large enterprises are expected to fuel the growth of this market in 2004.
Many enterprises in India are looking at ‘downtime cost’ implications
now, more than never before. Home buyers have realised that as a stabiliser
is necessary for their refrigerators and television sets so is the UPS, which
provides back-up as well as protection. B and C class cities are proving to
be an untapped market for UPS systems and vendors are exploring these new markets.
The market
According to IDC estimates, the Indian UPS market was worth around Rs 700 to
800 crore in 2003. Of this, the SOHO and the SME segment accounted for nearly
70 percent (between Rs 450 to Rs 550 crore) with large enterprises being responsible
for the rest. IDC predicts that unit growth in terms of low-end UPS systems
targeted at the SOHO and SME market will be around 40 percent.
The share of national players in the UPS market has increased due to strategic
initiatives taken by them to counter local players. American Power Conversion,
Emerson Network Power, WeP Peripherals and TVS-E are the leading UPS vendors
in India. (Source: IDC India) TVS-E, WeP Peripherals and APC have maintained
a leading position in the low-end UPS segment whereas it is APC and Emerson
Network Power who are the leading players in the high-end UPS market. GE Digital
Energy is gradually becoming a national player. Many branded players have started
to offer competitively-priced UPS models with added features to increase their
market share. Sanjit Sinha, head of hardware research, IDC India says, “Due
to the lowering of prices by some national UPS vendors, we may see many local
UPS players losing out to competition and becoming extinct in the long run.
The low price points offered by branded players will on the one hand eat into
the share of local vendors but on the other help in expanding the UPS market.
One can understand the true potential of the UPS market once we look at PC shipments,
specifically consumer PC shipments.”
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Project management groups increasingly include ‘uptime
propositions’ in their overall infrastructure solutions. Power audits
will get more formalised and mandatory in critical applications, says Hitesh
Prajapati |
ITeS and data centres
India has a good potential for growth in high-end UPS models. This is due to
the fact that Indian enterprises tend to have large single locations for business.
Large enterprise customers such as ITeS players want high levels of uptime.
The IT infrastructure in these cases is well integrated with UPS and precision
air conditioning systems. ITeS players are also ramping up and continuously
increasing their head count. Similarly, corporate data centres that are used
to house servers from different countries can’t afford even a single minute
of downtime. ITeS and corporate data centres are going in for high-end UPS models.
Sectors like manufacturing, telecom and the energy sector are also expected
to go in for high-end UPS purchases in a big way.
BFSI segment will go for a mix of both
Banking and finance is expected to go in for a mix of high- and low-end UPS
systems. Indian banks have a large number of branches and ATMs spread across
the country. Banks tend to have a large central data centre that requires a
high-end UPS model of around 40 KVA capacity. An ATM, on the other hand, can
get by with a 2 to 3 KVA UPS system. Since low and medium range UPS systems
are used in bulk by the banking, financial services and insurance (BFSI) segment,
this will drive both the high- and the low-end UPS market in India.
Untapped markets—B and C class cities
Vendors are bullish about the SOHO and the SME markets in B and C class cities.
In recent times, the telecom infrastructure in Indian B and C class cities has
come on par with those in the metros. Gone are the days when small Indian cities
had legacy telecom networks that were not compatible with the latest technology.
The changes have really helped IT penetrate deeply into these cities and into
adjoining rural areas. With Internet cybercafes mushrooming like the STD and
the ISD telephone booths across the country, UPS usage is definitely on the
rise. Moreover, it has been seen that many ITeS and BPO players have also been
eyeing these B and C class cities, which will drive the growth of the UPS market
in India. The fact that many of the initial ITeS centres in B & C class
cities will be small, there is a possibility of them using low and medium range
UPS systems. It is also a known fact that power cuts and fluctuations are worse
in small cities.
Widening the UPSdistribution net
Almost all the vendors are widening their distribution network through their
channel partners. For instance, APC is involving channels heavily and has a
field sales programme and a reliability provider programme (RPP) running across
the country. Under the former, APC gauges the channel’s needs and trains
the channel to sell its products successfully across 400 to 500 towns. APC tries
to identify large customers through the RPP and talks to them directly to sell
its products. Similarly, recent entrant GE Digital Energy is also aiming to
expand its presence deeper into B and C class cities through channels. Yogesh
Bhardwaj, country sales manager, GE Power Controls India says, “We already
have a substantial presence in the Indian metros but we aim to grow within the
B and the C class cities in India for which we plan to expand our distribution
network with the help of channels.”
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According to S Nagarjuna, localisation of UPS systems
is the only way to reach the common man in India |
The road ahead
It is hoped that UPS penetration within the SOHO and SME segment will accelerate
exponentially. R Sudham, product manager-power products, TVS-E says, “We
are bullish about the Indian SME market as awareness amongst them about UPS
systems is increasing. There will be a drastic change in the product buying
behaviour of the SME segment with a drop in the prices of branded UPS systems
in India in the near future.”
UPS adoption in rural areas, in e-governance projects and in the education sector
is on the rise. Huge deployments in the government sector are expected to materialise.
Large players are changing their strategies to target local UPS manufacturers.
While small and unorganised UPS players may survive for at least a few more
years the scales are tilting towards the branded national players who offer
better features and competitive pricing.
Beyond the UPS
Players like APC are trying to create a new market aimed at looking beyond the
UPS to change the complete physical infrastructure of a data centre. Anand Iyer,
country general manager, APC India explains, “ Enterprises need to look
beyond the UPS and should concentrate on properly designing the physical infrastructure
of their data centre.”
Indian enterprises are definitely looking at ‘downtime cost’ implications
and selecting the right solution. Hitesh Prajapati, head channel business, Emerson
Network Power says, “Prioritising ‘UPS’ purchase plans along
with critical network equipment has already started happening. It is not decided
only as a derived demand product to be ordered last. Project management groups
increasingly include ‘uptime propositions’ in their overall infrastructure
solutions. The infrastructure perspective will definitely come in more seriously
and power audits will get more formalised and mandatory in critical applications.”
It is boom time for UPS vendors who are going all out with their marketing drives
and strategies to woo customers. Branded players are set to emerge the winners,
having customised their products according to Indian conditions and also widening
their channel and distribution reach. And of course, they are all set to play
the price game by lowering the prices of their products.
| GE-Digital Energy is a fairly new entrant in
the Indian market. It set up office at Bangalore in September 2002. According
to IDC, GE Digital Energy is gradually emerging as one of the national players
in the Indian UPS market.
Plans and strategies for
2004
GE Digital Energy’s
prime aim is to expand its distribution networks through channels, especially
in B and C class cities. Bhardwaj of GE Digital Energy says, “We
already have a presence in the metros. Our products are well suited for
small Indian towns too. We sell our products in over 100 countries across
the world, which includes developing countries like Zimbabwe, Namibia
and Bangladesh, where the power situation is even worse than India.”
The company is manufacturing a few models of less than 5 KVA at their
factory near Bangalore. The major focus would also include having an efficient
support structure in place even in small towns and cities.
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| Most UPS vendors in India are playing the product
customisation card to make deeper inroads into the market. Power fluctuations
in some small Indian cities can vary between 150 to 290 volts. Therefore,
it is important for UPS vendors to localise their models as per Indian conditions.
Vendors are getting regular feedback from different regional markets across
the country and then tailoring their products as per requirements. S Nagarjuna,
general manager marketing WeP Peripherals says, “We have been investing
a lot of money in terms of understanding customer expectations and in coming
out with solutions based on their feedback. We have some specialised UPS
models aimed at the rural market and especially for diary applications.
Localisation of UPS systems is the only way to reach the common man in India.”
Even a MNC UPS player like APC has realised the importance of localising
its products in India and is locally designing and manufacturing some of
its UPS models to suit Indian needs and conditions. |
| APC is one of the leading UPS vendors in the
Indian market and provides end-to-end AC- and DC-based back-up power products
and services. Its products include surge suppressers, uninterruptible power
supplies (UPS), power conditioning equipment, power management software,
and DC power systems as well as precision cooling equipment, and professional
and consulting services for non-stop networking. It has a range of power
protection solutions that scale up from desktops to data centre operations
and entire facilities.
Plans and strategies
for 2004
APC is looking beyond the
UPS, towards transforming the complete physical infrastructure of a data
centre. It has introduced new power and cooling architecture—InfraStruxure,
which is made up of modular, highly manageable, pre-engineered components,
for on-demand network-critical physical infrastructure (NCPI) of a data
centre. APC has set up a proof of concept Centre in Bangalore to showcase
its new architecture to enterprise customers. It has similar centres in
Mumbai and Delhi as well. Besides this, APC is aiming to involve channels
heavily for the wider distribution of its products across 400-500 towns
in the country. APC is also running its field sales and reliability programme
to train channels and create greater awareness. As part of its ongoing
initiative of identifying large customers through channels the company
hopes to interact directly with many more large enterprise customers in
the future. APC will continue to locally design and manufacture products
to suit Indian needs and conditions.
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| Emerson Network Power is one of the leading
players in the Indian UPS market. According to the IDC estimates, it has
been very successful in the high-end UPS segment. It also provides end-to-end
solutions for protecting mission-critical equipment.
Plans and Strategies
for 2004
Emerson Network Power has
specially focused solution teams addressing specific verticals in the
market like IT, telecom, industry and healthcare to tap the enterprise
market. Emerson Network Power has been continuously investing in a committed
channel. It is planning to make deeper inroads through its distribution
partner Ingram Micro, which operates in most Indian cities. It is been
observed by Emerson Network Power that with expensive digital entertainment
products such as plasma TVs becoming more popular in India, the Indian
UPS market is seeing a new class of consumer wanting the best of protection
technology at home. Emerson is planning many new product launches in 2004
to address this growing market.
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| WeP Peripherals Limited (WeP) is also one of
the leading players in the Indian UPS market and concentrates only on the
SOHO and the SME segment. WeP Peripherals commenced operations in 1986 as
a peripherals division of Wipro Infotech. It manufactures UPS systems at
its manufacturing plant in Hyderabad. The company launched its first UPS
product in November 2000.
Plans and Strategies
for 2004
WeP Peripherals will be
coming out with different product versions from time to time to target
the growing SOHO and SME market. WeP Peripherals is also aiming to reach
more and more cities in India. WeP Peripherals has over 300 dealers, who
in turn manage thousands of resellers to sell the company’s UPS systems.
WeP Peripherals’s manufacturing plant in Hyderabad is in the process
of producing 1,00,000 UPS units in a year. WeP Peripherals has started
exporting its UPS models to the Middle East, SAARC and African countries.
It is aiming to export its UPS models to some European countries as well
in 2004. The company is also targeting rural Indian markets, especially
for dairy applications. It is also planning to focus on the North-East
and the Uttar Pradesh markets with its localised UPS models.
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| TVS Electronics, founded in 1986, started as
an IT peripherals manufacturer. It is also one of the leading manufacturer
of UPS systems targeted at the SOHO and the SME market in India. The company
has a distribution tie-up with GE Digital Energy and distributes its high-end
UPS models in India. It is also into contract manufacturing of UPS systems
for GE Digital, which are then sold in the global market by GE Digital Energy.
Plans and strategies
for 2004
TVS-E is very bullish about
the SOHO and the SME segments within the UPS market in India and most
of its plans are restricted to these segments. TVS-E sees the price factor
as a very important aspect, which will drive the growth of the Indian
UPS market, and in turn will strengthen the presence of branded players.
Sudham of TVS-E says, “SMEs have become cost and quality conscious.”
TVS-E has a presence in around 200 towns across the country and banks
upon its UPS models, specifically designed for the Indian market, to emerge
successful in the market.
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abhinav@expresscomputeronline.com
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