Rangu Salgame, Tata Commmunications: Playing the innovation card
Rangu Salgame, CEO of Tata Communications' Growth Ventures Group, took charge of the company's Service Provider Group in October. For the first time he shares his views on wholesale with Agnes Stubbs.
Ranganath ‘Rangu’ Salgame has a cure for jet lag. After flying many hours from one continent to another, he returns to his home in Princeton, New Jersey in the US, and indulges in a certain drama series on Netflix. “If I can’t sleep, then I watch Netflix for hours,” Salgame says. He stopped watching TV in 2005, but the video-streaming service has revolutionised his viewing habits: “Netflix has brought me back to entertainment.”
At the moment Salgame is hooked on “House of Cards”, the political thriller which has helped make Netflix a video streaming powerhouse.
Through his role as CEO of Tata Communications’ Growth Ventures Group, Salgame has strong ambitions to support this content revolution – and not just as a viewer. “We saw that opportunity three years ago, and believe we have a role to play, and a market to create for ourselves,” he says.
When Salgame took charge of Tata’s Growth Ventures Group in the summer of 2012, he picked out four high growth businesses that the carrier should capitalise on: data centres, media and entertainment, cloud and cyber security. “All these four businesses were carved out as separate business divisions so that we could give them more leadership and capital,” he says.
In the three years since, Salgame claims all four entities have experienced considerable growth. But it is clearly the media and entertainment market which has captured his imagination the most: “We’ve moved from conventional, linear television to non-linear television,” Salgame says, pointing to Netflix and Amazon as examples of the latter. “That’s changing how entertainment is delivered. It’s a market where massive transformation is going on.”
Tata has pursued sports broadcasting as a way to extend its media reach and presence, serving as technology partner for events such as Women’s Tennis Association, NBA and most recently, in February, the Master’s Rugby.
Since 2012, Tata has also been a major partner of Formula One events, providing race site connectivity, content delivery, web hosting and content delivery services.
The company provides real-time content at a one gigabit speed utilising over 310,000 miles of its subsea cable and an additional 125,000 miles of terrestrial cable. Pointing to a framed picture of a Formula One car in the conference room, Salgame refers to the event as “one of [its] major pillars of the entertainment business”.
Supporting its media partners is Tata’s vast network infrastructure, which famously features one of the largest subsea cable networks in the world. Less known is the company’s rapidly expanding data centre footprint, which presently stands at 44 facilities globally.
Last July, it announced plans to invest $200 million over a period of three years to double its data centre capacity in India.
“Some of the largest multinational customers from the US continue to expand in emerging markets and look upon Tata Communications as their preferred partner to provide them with high quality data centres coupled with our global network,” Salgame explains.
The company has entered into strategic partnerships with data centre providers and carriers in the US and across Asia in an effort to increase its data centre footprint. Tata is “likely” to build more data centres and enhance its offerings in emerging markets, he reveals.
The wholesale piece
Salgame’s role and responsibilities at Tata broadened significantly in October, when he took charge of the service provider group, following the resignation and retirement of Michel Guyot.
Salgame’s first priority in wholesale is to help its service provider customers provide the scale and reach required for serving enterprises. “The market is moving towards more complex requirements. It’s not just about buying wholesale as a commodity,” he says.
“Market dynamics are making carriers think differently in terms of how they bring their network pieces together, and that has been driven by how enterprises are consuming network connectivity.”
It is no longer enough for Tata to provide capacity from point A to point B, he says. “It’s about providing our carriers a service that is ‘managed’.
That means all the elements of security, cloud-enablement, so they can put those pieces together and be able to serve their customers.”
A big focus for 2015, he says, will be providing more support to its carrier customers, in terms of developing enterprise services and enabling them to provide solutions on a global basis. It is Tata’s global reach that Salgame views as crucial to serving its carrier customers.
“We’ll continue to invest in growing our network, and expanding our reach, which our customers demand of us. By far, we bring more reach to the market than most of our peers,” he claims.
Among Salgame’s top priorities will also be seeing that mobility plays an integral role in its service provider offerings. “With M2M used in verticals like healthcare and manufacturing, customers want that mobility access and backbone infrastructure that will allow your devices to communicate in the different parts of infrastructure around the world.”
He promises that “you will hear a lot more from us in the coming months in mobility”.
Like many other global operators, Tata has turned to innovation in order to bring new value from its network services. The key to staying ahead of the curve, believes Salgame, is to “go beyond providing a service as a commodity”.
In the case of mobility, Tata provides more than just the traditional roaming but also the solutions for MNOs to grow with new business opportunities, he says: “We’ve taken it to the next step of innovation.”
Salgame knows a thing or two about innovation. This, after all, is a man who in the late 90s, launched one of the market’s fist CDNs, Edgix, which specialised in internet edge services with caching and streaming services for service providers.
The wholesale industry, in his view, can and should do more to innovate. He points to voice services as an area of opportunity.
“The industry largely focusses on voice as a commodity, not as a place to innovate. It has written off voice as an area where you can’t innovate. I think an industry can also arise where there is innovation.”
Last January, Tata launched its mobile VoIP platform, a hosted white label solution that allows MNOs and other retail voice providers to offer their customers a converged communication service across voice, chat, video and file sharing.
Salgame refers to the platform as “a very important area of innovation” for Tata’s voice business. “We believe we are way ahead of the market in our position in wholesale - innovating so that our customers can do more for their subscribers,” he says.
Managed services is also becoming a key area for Tata’s voice business. “Large wholesale carriers are able to outsource their business to Tata,” says Salgame. “They focus on serving customers and we provide the tools that we’ve used over the last 10-15 years which are probably the best in the industry - that’s why we are a thriving business in voice.”
The company has also taken its first steps in exploring the potential of big data and analytics over the past year.
“If you’re a wholesale voice buyer from us, or we manage your voice infrastructure, you’ll be able to use these tools to get better intelligence about your customers, your traffic and destination patterns, as well as optimise your traffic more effectively,” he says. “The result is an increase in revenue and optimal cost management which produces better margins.”
Nurturing young talent
Salgame says his management style can be best described as “participative leadership”.
“I’m not top down. It’s always about getting the team involved and integrating them in decision-making and strategy,” he says. Salgame is passionate when he talks about developing new talent. It is something he finds personally rewarding and ensures he devotes time to.
“It’s important that as organisations, we nurture young leaders to step up and take risks. You can’t stick to a stodgy, telco mindset,” he says. “We’re pushing the edges of innovation and leadership. For young people who are willing to take risks, we make sure to nurture these leaders and develop their leadership skills.”
Salgame enjoyed managerial experience at a relatively early age. In 1990 he played a role in founding the Verizon’s internet and data business, and in 2003 went on to join Cisco as president of India and Asia operations. Later becoming GM of emerging markets, Salgame describes his time at the vendor as “career defining”.
During his five-year tenure, the country’s sales rose to an unprecedented market leadership position.
Salgame remains bullish about the future of telecoms. “This is the reason I joined the industry and why I’m still here. There’s lots of transformation going on, whether it’s in media, IoT, or cloud. And that really excites me, going from a vendor community to the service provider community,” he says.
“There’s a big role for carriers to play in all of these and I think the industry recognises that, more and more.”