The modem industry witnessed a decline in FY 2009-10, though the industry leaders including Atrie Technology, Bharti Teletech and D-Link witnessed a healthy growth. The overall market size declined by 4.5%. VOICE&DATA estimates that the overall market stood at Rs 340 crore. Last year the industry stood at Rs 356 crore.
Atrie Technology was the market leader with 52.9% market share. The company's revenue from the segment was Rs 180 crore with a growth of 4%. Both Bharti Teletech and Mumbai based D-Link saw a double digit growth. Bharti was the second largest player in the segment with a market share of 23.5%. Growing at a rate of 37.9%, the company's overall revenue stood at Rs 80 crore. Similarly, D-Link grew by 53.8%. The company's revenue stood to Rs 40 crore.
For Atrie Technology, there was growth in the service provider area including BSNL and MTNL, and in other service providers' areas too for WiMax CPE and WiMax backhaul. GSM backhaul and 2G continued to do good business. BFSI; transport including railways, roadways and airline ticketing and freight management system, e -governance and STATEWAN were the other major contributors for Atrie.
Atrie Technology's main orders for FY 2009-10 came from BSNL Phase 5 GSM for south and west India for the back haul of fiber and copper transmission and WiMax CPE. On the other hand, D-Link in the year 2009 introduced low cost ADSL modems like DSL-2640U, Wireless ADSL2+ having four ports Ethernet with routing capabilities. The product was aimed at SMBs for Internet browsing, P2P applications and online gaming.
On the business front, D-Link continued doing business with BSNL franchisees. Few other private service providers have also contributed to the D-Link kitty. The Mumbai based company witnessed over 30% growth in the over all broadband category including ADSL modems and associated network equipments like DLSAM's.
Trends in Modem
Modem technology was positioned to compete with other broadband technologies. Modems continue to be in good demand for high speed data connectivity and new emerging applications. The ADSL2+ technology modem continues to gain popularity in the SOHO market due to its effectiveness to offer a high speed broadband connectivity to SMBs and SOHO consumers.
The newer ADSL models with enhanced chipset like ADSL2/2+ standards provide Internet transmission of up to 24Mbps downstream, 1Mbps upstream.
WiMax CPE�ODU , IDU and USB based on 802.16 E in 2.5 GHz and 2.3 GHz WiMax backhaul on STM1, and Multiple E1 GSM�2G and 3 G backhaul, U-FOM, and FOM�fiber optic modem were the other technology additions. One of the major growth drivers of modem segment in India was the decrease in cost per subscriber due to the reduced cost per customer premise equipment (CPE). Lower operating expense for service providers, cost reduction in the associated equipments and social attitudes and habits embracing broadband facilities also played a role in the growth of modems.
The newer ADSL models-with enhanced chipsets like the latest ADSL2/2+ standards which provide Internet transmission of up to 24Mbps downstream and 1Mbps upstream-are few of the recent technology additions in this segment.
In addition to this, the security and quality of service have been enhanced in the ADSL modems to prevent unauthorized access to the home and office network from wireless devices or from the Internet. The built-in firewall security technologies such as Statefull Packet Inspection (SPI) and hacker logging inspect the contents of the incoming packets before they are allowed in, while hacker logging also helps to protect the network against denial of service (DoS) attacks.
Quality of service (QoS) features allow the modem to support priority queues, enabling a group of home or office users to experience the benefit of a smooth network connection without the concern of traffic congestion. QoS support allows users to enjoy high speed ADSL transmission for applications such as gaming and streaming multimedia over the Internet.
The modem industry has outperformed against all odds. Manufacturers continue to develop efficient devices with the latest technologies to support applications with Firewall protection, user access control, WPA/WPA2 wireless security, and priority queues.
Also, there has been an introduction of N standard wireless technology in ADSL modems. D-Link is launching DSL-2750E as its latest addition to the ADSL family. The company would be introducing a wireless N ADSL2+ four ports Wi-Fi router which is a high performance remote router.
Further, after the commercial launch of 3G and WiMax services, there would be more applications on the platform. Existing DSL will be the driver for growth in low cost, low ARPU segments compared to the international markets. The numbers will increase exponentially in the next few years. Also, new operators entering this area will give more competition. Thus, there will a compelling increase in customers and more PC penetration in the tier-2 zones and rural India.