Interviews

Netmagic Is One Of The Strategic Acquisitions For NTT

Netmagic
Sharad Sanghi
CEO & Managing Director, Netmagic, an NTT Communications Company

NTT Com India recently completed a decade of successful operations in India. With a robust India strategy ahead, the company will continue to invest in and expand high-quality Datacenter /Cloud services and international network services based on its service strategy “Global Cloud Vision”.

With an explosive growth in data traffic in India along with an expansive need for hosting and cloud, NTT Com India, along with its sister association Netmagic Solutions, is gearing up to tap the umpteen opportunities. In an exclusive interaction with ChannelTimes, Sharad Sanghi, CEO & Managing Director – Netmagic, an NTT Communications Company, shared the growth story of Netmagic, post the acquisition.

CT: Since the acquisition of Netmagic, how has been the relationship between both the companies have grown over a period of time?

Sanghi: Netmagic is a strategic acquisition for NTT, its not only give them access to fastest growing markets in the world, it enables managed services, quality and low cost development out of India for the cloud and other services and remote infrastructure management across the world. We are the key partners to provide the services, we are one of the three partners with in NTT family that does cloud development and does global network management.

Netmagic has been growing at 35% CAGR. It has been fantastic relationship with NTT Communications India because they realised that nimbleness and flexibility of Netmagic is intact. NTT provided us capital for our datacenter growth. It brought us global customers as well leveraged our skills in cloud development by outsourcing some of the global cloud development to India. Moreover, it leverages our skills in managed services by allowing us to manage datacenters and cloud centers across the word. We have also got advantage of some of their best practices. We also got advantage of offering their data centers across the world to our own customers. Now, it is acquiring a Network License later this year, we will be able to offer additional options to some of our customers. Lastly, the deal helped us to increase the percentage of our global revenues.

CT: Post acquisitions, how have you ramped up your datacenters footprints in India?

Sanghi: Currently, we have eight data centers in the country: four in Mumbai, two in Bengaluru and one each in Chennai and Noida. Of which we had, five mid sized datacenters when we were talking about the acquisitions in the year 2012. The sixth one was built before the acquisitions but got completed post the acquisitions. But the first two large datacenters we built post the acquisition: one was in Bangalore last year and the second one is coming up in Mumbai, which will be launching in Q3 this year.With 300,000 square feet of space and 3,000 racks, this would be one of the largest data centers in the country. This is the first data center that we own ourselves instead of having a long-term lease as is the industry norm.We would be investing $100 million in this data center.

CT: How are you leveraging other four subsidiaries of NTT group to strengthen Netmagic business in Datacenters and Cloud?

Sanghi: Out of five subsidiaries of the NTT group, we work closely with NTT Data, as we operate at the infrastructure layer, customers often want an application to be hosted either as service or they want expertise on the applications. They don’t want to work with multiple different fronts– for applications, infrastructure and other for networks– so we partner with NTT Data on several cases where they provide applications support and we provide them infrastructure supports. But we have given common interface to the customers. We intend to do same thing with NTT communication India as it is acquiring national long-distance (NLD) license, to offer a host of ICT solutions to customers through the data center. Besides this, we also work closely with NTT Communication India and Dimension Data as well it provides us hardware and SIs, we collaborate with them on cloud as well as on datacenter, Dimension Data does have a partnership with BSNL, and government customers, but we work together for private customers.
While NTT Comm india would provide network services as well later this year, we will be jointly working on lots of innovations. Although, we will be working as one company, there will be separate entities in India as per the license norms in India.

We are looking to grow our footprints in Software Defined Network(SDN) as we are collaborating with NTT for the global roll out of SDN, which will allow us to offer global seamless cloud service, India will become part of this service.

CT: Besides Datacenter Colocation, how has been the contribution of Cloud business growing for Netmagic?

Sanghi: Cloud is a fastest growing revenue stream for Netmagic, close to 14% of our revenue comes in less than four years. It is one of the fastest growing businesses. Our focus is on mission critical enterprises providing them not only just infrastructure but complete managed services. This is where we differentiate from over competitors, we are the first to learn software defined storage last year. We are very much at par with any of the cloud providers in the world. To grow cloud business, we have started startup cloud services to offer free cloud service for the six months, we intend to make it popular with the startups. Today 70-80% of the e-commerce uses our services be it cloud or co locating their servers in our datacenters.

As organisations like banking and finance, manufacturing, media and entertainment and ecommerce want to focus on core competency and outsource the infrastructure services to a third party. We see our cloud business will continue to grow. On the other hand, our Datacenter business is growing so fast that our existing Mumbai facility is out of space, we are now building a much larger footprint.

CT: As more and more Cloud companies like Microsoft , IBM and Amazon have announced to plan setting up of datacenters in India, how this would intensify the competition for Netmagic

Sanghi: With more cloud providers coming in. It will increase colocation business. There will be some collaborations as well, we are already partnered with Microsoft and Vmware. Having said, there will be some healthy competitions. It will create lots of awareness about the cloud. It will be positive and good for the industry as a whole. It would also eliminate cloud related myths like security and other myths that exist.More and more people will adopt cloud for mission critical applications. It will open up the market and we think market size is large enough for multiple players.

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