Cisco to ship 20% top execs to India

In a move to make India one of its global strategic centres, US-based computer network equipment major Cisco Systems today said it would shift 20 per cent of its top executives to India. It also proposes to make India "Cisco Globalisation Centre East."

Addressing a press conference with Telecom Minister Dayanidhi Maran, John Chambers, Cisco's chairman and CEO, said, "India is a very important market for Cisco's global growth strategy. Half of the future headcount growth will come from India and the country will contribute about 5 per cent to our revenues in the next 3-4 years. The country has a highly skilled workforce, innovative customers, supportive government, and world-class partners."

INVESTMENT BREAK-UP

$50 mn for new R&D campus in Bangalore

$750 mn for R&D, training and development in the next 3 years

$50 mn out of the $150 million fund to provide leasing and other financial solutions

$100 mn for venture capital investments

$25-30 mn in companies involved in broadband content and digital media

$100 mn for growing technical services, spare parts depots and channel development

$10 mn for the development of a BSNL lab in Chennai

Wim Elfrink, the company's third-most senior official, will be its new chief globalisation officer and relocate to Bangalore next year. Elfrink, however, will retain his position of senior vice-president of customer advocacy and report to John Chambers.

The company also intends to triple its headcount in India over the next three to five years. It has 2,000-6,000 employees in the country at present. About 95 per cent of the headcount addition will be accounted for by Indians.

Cisco will also start a trial factory in Chennai for making Internet protocol-based phones, as part of its $1.1-billion investment plan for the country. The manufacturing will be done by Cisco's global partner Foxcon, and is expected to happen by April next year.

California-based Cisco had announced in October 2005 an investment of $1.1 billion in India over the next three years.
 

What are IP phones?

IP Phones look and function much like typical corporate phone system handsets, but in some cases they also take on PC-like functionality. These phones also support features such as call forwarding, redialing, speed dialing, transferring calls, placing conference calls, and accessing voice mail. IP phones transmit voice using data packets (similar to the way the Internet routes data) instead of circuit-switched (the way the vanilla phone operates) connections.

Hence, technically, all calls are free and all the user pays for is the IP phone software. However, this was not allowed by the Indian government till January-end 2006. The reversal of the government policy (in late January this year) to restrain IP PBX over Close User Groups (CUG) is likely to act as a catalyst for the growth of the Indian IP PBX market and create new opportunities. IDC states the Indian IP telephony is expected to register an average of 60% (CAGR) over the next 3-5 years.