Dax aims high after alliance with Maipu

Trying to wrest market share from leader Cisco has never been easy. Indian companies are now looking at building alliances with global players to counter the American gaint. In an approach that’s similar to D-Link’s strategy, Chennai-based Dax Networks has entered into a joint venture with Chinese networking major, Maipu Communications. Srikanth R P analyses the impact of the deal

Sujit Singh claims that market acceptance of the alliance can be seen from the fact that Dax has sold close to Rs 11 crore worth of routers in just two months and has gained a market share of 2 percent in the router market

The Indian router market is estimated to be worth close to Rs 550 crore—a market dominated by Cisco. Though many vendors in the past have tried hard to win market share from Cisco, the lack of suitable products have dented the ability of players to provide worthy competition to Cisco. But with the alliance with Maipu Communications Dax seems to have found the missing link it needed to combat Cisco’s firepower. For the record, Maipu is the second ranked router manufacturer in the Asia-Pacific region.

Says Sujit Singh, country manager, Dax Networks, “Our strategy has been to push aggregation and access routers, which account for over 62-70 percent of the market for routers in terms of number of units. Market acceptance has been high, specifically in the telecommunications, ISP and e-governance space. This acceptance can also be seen from the fact that we have sold close to Rs 11 crore worth of routers in just two months and gained a market share of 2 percent in the router market.” Singh is bullish on the router space and has earmarked a target of 20,000 units and a revenue target of Rs 80 crore to be achieved in the next three years. Dax is also investing around Rs 2 crore for customising Maipu’s products to the Indian environment.

Dax’s strategy of focusing on access and aggregation routers has meant that the company can even pitch for projects that deploy Cisco routers at the central site. This strategy has seen Dax bag significant wins like Southern Railways (Chennai), e-Seva (Andhra Pradesh), Airports Authority of India (all-India), BSNL (Hyderabad and Pune), Central Soil Research Institute (Dehra Dun), Orient Ceramics and Industries (Delhi) and Ministry of Defence (Northern Command). Additionally, Maipu has been traditionally focused on the access router and aggregation router market, which have Cisco products as the central router. Singh claims that as Dax-Maipu router’s command line and Web-based configuration is similar to Cisco, the end-user does not need retraining to configure the router. This interoperability factor with Cisco’s routers provides Dax a ready market to tap. Singh also believes that the IOS (Internetworking Operating system), which is embedded in routers at no extra cost would prove to be a competitive edge over rivals.

Says he, “The IOS is so flexible that it allows the user to configure and monitor routers from any standard Web browser. Users can manage routers remotely and ensure the routers inter-operate with any industry-standard routing protocols, including a few proprietary protocols offered by the competition.” For making a dent in the market, Dax is positioning the routers at 30 percent lesser cost than Cisco’s routers. Plus, Dax is also throwing in a three-year warranty at no additional cost.

Conclusion

While the Dax-Maipu tie-up has seen the alliance gain market share of 2 percent, there’s still a long way to go before Dax can hope to be competition to market leader Cisco. But for the moment, alliances with foreign brands are surely clicking for Indian networking companies.

srikanth@expresscomputeronline.com