The Hindu Business Line : Dax inks pact with Chinese major, bullish on routers

DAX Networks, a networking solutions provider, has entered into a joint venture with Chinese networking major, Maipu Communication, to expand its market share in the country's growing router market currently dominated by multinationals.

Maipu is an Intel-initiated company and has emerged as a second major network and communications products company in Asia.

Mr Sujit Singh, Country Manager of Dax Networks, who was in Hyderabad recently to meet up with industry players, told Business Line that Dax offers a comprehensive basket of networking products and is bullish on the market.

The Indian router market, estimated at about Rs 459 crore, is dominated by Cisco and Nortel.

There is hardly a domestic player in the router space with the capability to customise to the diverse requirements.

"With Maipu we will be able to make inroads into this space and complement the growing market for routers," he said.

Last year the company forayed into the router market with the launch of an entry-level product.

"Within a year of its launch, Dax became the third largest player in the space and acquired over two per cent market share. After this test marketing phase, the company expects to garner revenues of Rs 80 crore from the router market over the next three years," he added.

According to him, Dax is working in partnership with about dozen vendors including CMC, Wipro and PCS.

"The Indian market for routers is growing at a steady pace and we expect large deployments in e-governance applications, telecom, banking and financial services and corporate segments."

He added: "For instance, the company has placed routers in major projects for BSNL and in the e-Seva project of the AP Government addressed by CMS and UTL. We are also working with ITC for e-choupals."

Encouraged by the market potential for customised products, Dax Networks has carved out a plan to consolidate its position in the router market.

The company addresses about 14 categories of networking applications with a basket of about 280 products.

While the marketing is direct, the deployment is through vendors.

This is complemented by a network of 25 distributors, more than 2,000 resellers and 440 solutions providers.

The company recorded revenues of Rs 60 crore in 2002-2003 and expects to scale up by about 25 per cent this fiscal.

"Along with BSNL, where over 50 sites have been linked with Dax routers, the company is working with a major rural networking and connectivity project initiated by Prof Jhunjhunwala of IIT-Madras in three States.

"So far, seven of 100 sites have been linked up where the project is powered by the Linux-based software. This means modifying the rules of the game where a lot of customisation and changes in the hardware had to be brought about."

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