You are on page 1of 20

Technology and BFSI Sector an emerging market view

Ashok jhunjhunwala, IIT Madras, India

3i Infotech Global Strategy Meet 200

Phases of Learning
!ow does one learn " understand a conce#t$
%hen a teacher &or so'e e(#erienced #erson " elder) tells you

and you *+,I+-+

Mathe'atical " Theoretical learning. understood in ter's of

jargon" bu// words

!ighest for' of learning. when you can go back and e(#lain the

conce#t to your grand'other

3i Infotech Global Strategy Meet 200

+'erging Market Technology

*0SI going forward

0ront end 1etwork *ack2end Security and Authentication

3i Infotech Global Strategy Meet 200

!merging "arket
India 3 4hina
-ery ,arge #o#ulation


-ery ,arge Market but at right #rice #oint as affordability is low Teleco' syste's ten years back broke e5en at 627 A5erage re5enue #er 'onth &A89:). about ten 'illion #hones in India Today;s teleco' syste' designed to break e5en at 6 7 A89:. India adds <00 'illion #hones #er year Ta##ing the large 'arket enhances inco'es 5ery ra#idly +nhancing the affordability further

3i Infotech Global Strategy Meet 200

$hanging Indian %fforda&ility'()" ur&an homes

Number of HH in millions 25 20 15 10 5 0 100 180 260 360 520 840 1300 3500 M onthly Hous e hold incom e in $ 21.2 15.8 12.8

5.8 3.2 2 0.8 0.9



1os of !! in M

Monthly !! Inco'e in 6

$hanging Indian %fforda&ility'1)*" rural homes

120 Number of HH in millions 100 80 60 40 20 0 60 180 260 360 520 840 1300 2240 HH Incom e in $ pe r m onth 17 10 3.9 1.9 1 0.3 0.3 102.1


( Monthly !! Inco'e in 6

1os of !! in M


Serving !merging "arkets

As one develops
the technologies the business models and the processes

to serve this very large but low affordablility market profitably

one becomes the global leader

3i Infotech Global Strategy Meet 200

% technology e,ercise


9orting of M93 'usic decoder on a >S9 #rocessor co''only used in

4 code a5ailable on standards website. ?00 #lus MI9S @#ti'ising 4 4o'#iler. A00 #lus MI9S 9rofiling and figuring out which data is used 'ore often and #lacing the data

in suitable internal 'e'ory and 4ache. B0 MI9S 9rofiling and hand2coding three functions in asse'bly &less than 70 line code). <A MI9S
Si'ilar nu'bers with M9+G2 decoder on the #rocessor
0ro' blind #orting . <0000 MI9S to o#ti'ised #rogra''ing and #orting. =00 MI9S

A software can be e(ecuted 20 to A0 ti'es faster with right design and


3i Infotech Global Strategy Meet 200



4o'#uter Syste's and Software solutions are co'#le(

49: MI9S, architecture, cache, internal 'e'ory, e(ternal 'e'ory,

disk latency and 5irtual 'e'ory, asse'bly and high le5el language
,arge nu'ber of 5ariants deter'ine #erfor'ance and res#onse ti'e

!igh functionality #rogra' creation is a huge effort. has to be si'#le

to create and 'aintain

reCuires large nu'ber of #rogra''ers 3 need not understand architecture

%ell o#ti'ised &in ter's of #erfor'ance) #rogra' reCuires a far

greater effort, 'ore difficult to create and 'aintain

%ould reCuire 5ery e(#erienced and trained #ersons

Moore;s law co'#ensates for non2o#ti'ised #rogra''ing !ardware beco'es faster and chea#er, while #rogra''ing #ractice focus on functionality rather than o#ti'isation
. 3i Infotech Global Strategy Meet 200

Technology dri5es *0SI today

0ront2end technology 1etwork *ack2end syste's and software Security and authentication


3i Infotech Global Strategy Meet 200

+nabling end2custo'ers to access banking, financial and insurance


-ery ra#idly changing +nabling 5ery high growth of custo'ers, es#ecially in e'erging 'arkets In India, front2end #art of a transaction in5ol5ing a bank2teller costs

the bank a bit under :S> 2 #er transaction

An ATM transaction costs 6 0D27 An Internet transaction costs the bank nil and a 'obile transaction costs the bank nil

+lectronic transaction reduces the costs drastically and enables

+(#ansion of custo'er base 4a#turing 'ore and 'ore transaction &s'allest #urchases) by the



3i Infotech Global Strategy Meet 200

%atch out for.
Mobile based transaction 1atural 5oice based transaction using s#eaker recognition in

'ulti#le languages and I-8

+s#ecially as large sections of #eo#le in e'erging 'arkets are far 'ore

co'fortable with 5oice

%e should take leadershi# in e'bedding these technologies

in each of our #roducts

12 3i Infotech Global Strategy Meet 200

*eco'ing o'ni#resent, high2ca#acity, secure, redundant and


,ast 'ile on broadband wireless in co'ing years would close

the ga#

0ibre can carry astrono'ical bandwidth o5er long distances

%ith %a5elength >i5ision 'ulti#le(ing, it carries about a tera2

bit #er second

A 'illion full screen M9+GB 5ideo carrying ca#acity

4o##er with >S, can carry <0 Mb#s for short distances
1 3i Infotech Global Strategy Meet 200

1ireless' Beware of hy2e

Through#ut de#ends on distances, nu'ber of users, #eak to

a5erage reCuire'ent, s#ectru' a5ailable, reuse of s#ectru'

Today;s terrestrial wireless &3GE, %iMa(). <00 kb#s a5erage #er

user in dense en5iron'ent with 'ediu' s#ectru'

,ikely to tri#le in two to three years

Satellite wireless S#ectru' reused across l000s of F's. a single bea' will illu'inate whole of India or 4hina A trans#onder gi5es net of 2B Mb#s &both ways) and costs about 6 < 'illion a year &sharing cuts through#ut by =0G If shared by <0,000 ter'inals HI <DA kb#s a5erage both way 9eak rate could be 7<2 kb#s and higher through#ut when not shared Satellite is great for broadcast and for unreachable area
1# 3i Infotech Global Strategy Meet 200

Tomorrow3s 0etwork
M9,S or Metro2+thernet -91 network using fibre, co##er and wireless
Satellite in real re'ote areas

4usto'er configurable data2rates

1etwork Manage'ent to 'anage traffic, security, network ele'ents,

ser5ers, end2de5ices including custo'er deskto#s and 'obiles

7 -endor 2

4an we design these networks$ 4an we de#loy these networks$ 4an we 'anage these networks$

-endor <



3i Infotech Global Strategy Meet 200

The critical #art, es#ecially in the *0SI seg'ent Ser5ers, o#erating syste's, database, 'iddle2ware, a##lication


1eed to scale as nu'ber of end2custo'er and nu'ber of transaction


*ack2end bank transaction costs 3 to 7 cents #er transaction in


*anks not concerned as long as front2end do'inated by teller or

ATMs *ut as Internet or Mobile transaction increases, back2end would do'inate &well designed network cost would contribute 'ini'al)


3i Infotech Global Strategy Meet 200

Story of telecom &ack/end costs

In <??B in India it used to cost 8s < &2D7 cents) #er transaction
Telcos used to charge e(tra for detailed long2distance billing *harati Teleco' outsourced to I*M their co'#lete IT back2end on re5enue

share #rinci#le

A5erage call " SMS gi5es 8s 0D27 to telco HI I*M gets about 7G Initially I*M struggled 22 but today its cost #er transaction is about 0D=# &8s 0D00=)

%hy has this not ha##ened in banking$

*anking back2end has not yet co'e into #ressures *anking software built2u#on legacy software of A0;s and =0;s !as barely used technological ad5ance'ents

%ith Mobile transaction, e5ery #urchase of a custo'er 'ay co'e on bank;s


5olu'es can go u# <00 fold with only float"s#read as inco'e *anks" insurance co'#anies ha5e to do what telcos did


3i Infotech Global Strategy Meet 200

!merging market dynamics

8edesign back2end #roducts with scale of these 'arkets in 'ind

1etwork through#uts for end2custo'er is not unifor' >o we design #roducts to be network aware$
+nd2user deskto#s 'ay 5ary. not necessarily to# of line
>o we design #roducts kee#ing for deskto# 5ariations$

>eli5er the functionality in 5arying conditions to enable large

5ariety of custo'ers Capture leadership


1os of !! in M

India Monthly !! Inco'e in 6

Security and authentication

Security techniCues 'ature. encry#tion, key distribution, le5els of

security and threats

I'#ortant that e5eryone in *0SI sector understands basics 8e'e'ber that 94 is a insecure de5ice &re#laced software on a 94 can

#retend to be original)

1etwork Manage'ent to continuously scan the deskto# software

Authentication. #assword " 9I1s are #oor authentication de5ices

*io'etric authentication getting 'ature

Auto'atic detection of security 5iolation by ca'eras

e(ecuted in real ti'e

%as i'#ossible few years agoJ Moore;s law has enabled co'#le( algorith' to be

+(a'#le. a ca'era with e'bedded algorith' s#anning a roo' and checking

out if so'e one brings in a brief2case in the roo' and lea5es without it


3i Infotech Global Strategy Meet 200

My #erce#tion
3i has e(celled in distributed syste's and distributed

!as so'e great #roducts %ill continue to be the growth engine in years to co'e

In co'ing years
Should stri5e to beco'e the technology leader in a few areas %ould gi5e a distincti5e co'#etiti5e ad5antage


3i Infotech Global Strategy Meet 200