— Gurudutt M, Director - Home & Business Networks Division,
APC Schneider Electric India
APC by Schneider Electric, a global leader in critical power and
cooling services, provides industry leading hardware, software,
and services designed to ensure availability and higher energy
efficiency across the residential, business network, data center,
and manufacturing environments. In this exclusive exchange,
Gurudutt M. gives keen insights into the Indian power conditioning
and backup industry, and explains how APC by Schneider has been
maintaining its leadership in the market. An interview by
Venugopal Pillai.
To start with, tell us about the Indian "Home UPS" market. What
is the estimated size and at what rate has it been growing in
recent years?
According to a Frost & Sullivan Report, the Indian UPS market
was worth $528.5 million in 2010-11 and estimated to reach
$828.2 million by 2017-18. The overall market is growing in
double digits on a y-on-y basis.
Coming to home UPS market, the current market size is
pegged at approx $10.5 million, which comprises of mostly sub-
600VA SKUs. This is considering only the pure UPS segment,
and does not comprise of the home inverter market, which is
also classified as Home UPS by various brands, due to taxation
and other issues. If we consider the home inverter market as
such, that's another $400-million market (including batteries).
Despite a large penetration of home computers and other
appliances, the penetration of UPS is limited to areas that
suffer power cuts or voltage fluctuations. What is your view?
That's not exactly the case. If that were the logic, we should not
be selling any Home UPSs in cities like Mumbai, where there
are seldom any power outages! Yes, we agree that the
penetration rates are higher in geographies with higher power
outages, but the channel and consumers in India have become
educated and more aware now in terms of the real application
of the UPS. They know that the primary job of an UPS is power
conditioning and secondary job is power backup. This is a
change that we have witnessed in the last five years and the
trend is getting stronger every year.
With India's economy set to grow at a brisk pace and with the
continued power deficit situation, the demand for alternate or
backup power solutions in the form of generator sets, power
inverters and UPS solution is expected to witness a healthy
growth in the coming years.
The low-KVA UPS market, as we perceive, has several
manufacturers in the unorganized sector. What is your
opinion?
Yes, the low end market is highly fragmented, primarily owing
to the low entry barriers. In our estimate, there are more than
500 brands of entry level UPS systems, currently operating in India, and in such a diverse and vast market we are very proud
to be the market leaders. According to Frost & Sullivan, the
competitiveness in the market is intensifying, with barriers to
the entry of new participants, especially in the up to 20kVA
power range, becoming lower. The biggest challenge faced by
UPS manufacturers will be cheap imports from China and
Taiwan as well as rising raw material prices.
However, over time, the partners have understood the flaws
and pain areas associated with the so-called Chinese and
Taiwanese imported boxes, in areas like service, product
quality etc, and they are not very keen to support these short
lived vendors and put their reputation at stake in the market.
If you see, lot of local players shut down their operations in
the 600 VA segment every year. It is an easy category to enter,
but a tough category to sustain in and live up to the customer's
expectation in terms of reliability, availability and service.
We are one of the very few players (and perhaps the only
one) to offer a 2-year onsite swap warranty on the UPS as well
as the battery, across India, with the fastest turnaround time in
the industry. It is factors like these that differentiate a market
leader like APC and others, when it comes to sustaining in the
long run and ensuring customer delight.
What is APC's strategy of tapping the growing potential of Tier-
I and Tier-II cities?
Currently, we are present in 450+ cities, via our consumer /
commercial product offerings. Our target is to reach out to 550
- 600 cities by the end of this year, and we have targeted geoexpansion
programs in place. The challenges with respect to
customer service and reach are addressed by our services
team and we are fully equipped to take the plunge into the next
100-150 cities within India to establish a strong footprint here,
with the support of our channel partners.
The penetration of the IT/ITeS sector in tier 2 and tier 3
cities and the digitization initiatives of the government in
various departments are leading to the growth of the UPS
market in these cities. We expect a lot of customers to focus on remote management in the coming times in the 8 to 40 KVA
space, and hence we are offering remote management
solutions as a part of our standard product offering, which is
again unique to the industry.
The Indian UPS market of late is witnessing the entry of several
multinational players. What is your view on the emerging
competitive environment?
Last 24 months have seen a couple of multinational brands
entering the market. Healthy competition is always welcome
and we view it as a step towards a more mature and consumer
driven market. We continue to maintain the equity in the market
place with both the channel partners and the end customers.
We also understand that India is a diverse country with
diverse customer needs and expectation, with
varying geographical terrains as well. Hence
it will be very interesting to see how these
new entrant MNC brands fare on the
servicing and after sales support fronts
within the next few years, which will actually
be the litmus test for survival.
Tell us about APC's "end-to-end non stop
networking" package for large corporations.
With every new connection, the role of data
in business is changing. Not long ago, a
company's data pool was primarily a
historical reference point. That point is now
a moving target; data capture and
distribution has become a real-time, global
flood. Customers demand instantaneous
response. For companies, the threat of competition requires
total, up-to-the-second awareness of customer needs.
Meanwhile, the volume of data has changed the role of
information systems from data collection and processing to
revenue capture. Where data was once used to drive revenues,
E-commerce has transformed the data into actual revenues. In
business, availability is everything because data is everything.
The need for Nonstop Networking in this data-intensive
world is derived from APC's vision and mission. Our vision is to
have APC products ensuring availability wherever data is
created, transmitted or stored. In support to our vision, our
mission is to create delighted customers by improving the
manageability, availability and performance of information and
communication systems through the rapid delivery of
innovative solutions to real customer problems. Understanding
the industry trends and staying ahead of the curve in terms of
solution development is critical to APC's success.
With the acquisitions of Uniflair, APW President, Digilink and
Luminous by Schneider Electric we now have even a more
comprehensive product portfolio to pitch for and install at the
customer place.
In the "large business", which segments do you consider as
your biggest demand drivers?
There is a steady demand from sectors such as the government
and infrastructure, information technology and IT enabled
services (IT/ITeS), banking, financial services and insurance
(BFSI), manufacturing, telecom, power and oil and gas.
While APC by Schneider Electric is a leader in providing data
center solutions and power back up for the IT sector, we have
also ventured in to non IT sectors providing reliable and secure
power solutions. The new concept launched by APC by
Schneider Electric called "Secure Power" is an effort by us to
provide reliable power application and power quality solutions
to mission critical non-IT applications. Secure Power Systems
offer a comprehensive roster of hardware and services
applicable to a wide range of industries, as well as direct
development of new technology and services to meet evolving
customer demands.
Over the years we observe a growing
consciousness of adopting "green" technologies
in the manufacture of UPS. Could you elaborate?
APC by Schneider Electric is globally committed
to the cause of helping every critical business
environment make the most of their energy,
given the soaring energy costs and the global
energy crisis. This is evident in the superior
'energy saving' technology of our solutions,
the global awards and recognition we've
received, in the testimony of our clients
and the many 'green datacenter'
initiatives we take.
We recently launched Back UPS Pro or
Green UPS. The Back-UPS Pro is the first UPS in
India with intelligent green features like, power saving
outlets that automatically turn down idle peripherals,
high-efficiency charging system and "AVR Bypass" to reduce
power consumption. It is APC by Schneider's endeavor to
encourage consumers to take the first step towards becoming
more responsible towards the environment.
The Back UPS Pro comes with some intelligent green
features like two surge outlets. It is the most energy efficient
backup unit designed to protect homes and businesses from
experiencing the inconvenience caused by power outages,
minimize energy consumption and help the consumer save as
much as Rs.2,000 a year on electricity bills. Back -UPS Pro, not
only saves data but also optimizes power consumption.