Cisco invests in dedicated data center for WebEx in India

US-based multinational technology services and telecom equipment provider, Cisco, announced Tuesday that it is investing in dedicated data center capacity for WebEx, its remote conferencing, file sharing and contact center operation services suite, in India. The undisclosed investment amount will be used to set-up a domestic data center and acquire regulatory licenses for WebEx in India.

Incidentally, Cisco’s announcement comes about a month after the company, on September 13, became the first over-the-top (OTT) internet-based service provider to get a Unified License from the union ministry’s Department of Telecommunications (DoT) to offer national and international long-distance services.

The license allowed Cisco to operate its own private enterprise telecom network for national and international services, including connecting with and operating its own data center infrastructure. The company also said at the time that its Unified License will not be used to compete with telecom operators in India — namely Reliance Jio, Bharti Airtel, Vodafone Idea, and newcomer Adani Data Networks.

Cisco claimed in its Tuesday announcement that the WebEx data center investment was the first of its kind for an OTT collaborations and communications service provider in India. The move is in line with the DoT’s new set of draft telecom rules, which mandate OTT service providers to fall under the same regulatory ambit as telecom operators — since the services offered by both are competitive in nature.

Setting up a domestic data center facility could be key to offering a larger suite of services. Closer proximity to a data center for a customer and the service operator allows the latency of a connection — the time taken for data to travel from one point to another — to drastically come down. This, in turn, also offers better control over security standards, and enables larger bandwidth (or amount) of data that is used by companies in their services.

According to Cisco, India is the second largest market for WebEx after the US, its home market.

A local data center facility could also help improve data localization strategies for companies migrating to online services. While not mandated by law for most sectors, the upcoming data privacy law in India is expected to add regulations for a larger amount of data to be localized in the country — anticipating which data center operators such as NTT, Yotta, Equinix and others have been ramping up data center capacity in the country.

Services providers have also been increasingly offering data localization services in India. On September 21, US-based content delivery network (CDN) operator Cloudflare introduced its data localization suite to businesses in India — alongside Australia and Japan — to get greater control over how data travels across borders.

On August 29, Jonathon Dixon, managing director for Asia-Pacific, Japan and China at Cloudflare, told Mint that the company will be data localization compliant in India by the end of the year — a practice that other companies also appear to be ready to emulate, given the increasing market opportunity for cloud-based services in the country.

Daisy Chittilapilly, president of Cisco India, said that with this move, Cisco will seek to capture a larger share of the global market for hybrid work platforms — which is expected to grow to at least $250 million by 2025.