AI Will Place ‘Unprecedented Pressure’ On Digital Infrastructure

When Amur S. “Lakshmi” Lakshminarayanan took the helm of Tata Communications in October 2019, he inherited a company with deep telecommunications roots, but uncertain prospects in an increasingly digital world. Traditional telecom providers were being relegated to “utility pipes,” simply carrying traffic without adding strategic value, while enterprises demanded intelligent, agile and secure digital infrastructure that could power their global ambitions.

Five years later, Lakshminarayanan has orchestrated a remarkable transformation. Under his leadership, the India-based company—which maintains significant U.S. operations in Santa Clara, California; Reston, Virginia; and Matawan, New Jersey—has evolved from a legacy telecom provider into a global communications technology powerhouse. Through strategic acquisitions like The Switch and Kaleyra, plus over $1 billion in capability investments, Tata Communications now generates nearly 50 percent of its revenue from digital services.

From powering Formula 1’s ultra-low latency media workflows to enabling AI-ready infrastructure, the company has positioned itself as a strategic partner for U.S. enterprises operating in an “always-on” digital world. In the following interview, Lakshminarayanan shares his strategy.

How did you lead Tata Communications’ evolution from a telecom provider to a global communications technology player?

When I joined Tata Communications in October 2019, I stepped into a company with a strong telco legacy, but also one standing at a critical inflection point. The world around us was evolving fast. Everybody was having telco’s lunch.

Telcos were still operating like utility pipes—carrying traffic, without shaping or elevating the value of what flowed through. Enterprises, however, no longer wanted just connectivity; they demanded intelligent, agile, secure digital infrastructure.

At the time, we were also under-leveraging our potential. Our capital intensity was high, margins and return on capital employed were low, and we had little proprietary IP to drive differentiation. So, our first priority was clear: become financially fit.

This meant improving operational discipline, optimizing costs and restoring profitability. At the same time, we needed to change how we saw ourselves—not just as a network provider, but as a strategic partner enabling the digital ambitions of global enterprises.

Our transformation journey began in earnest when I joined, and we articulated this vision through our Reimagine strategy, that formally launched in 2020, right at the onset of the pandemic. It marked a pivot from legacy thinking to forward-looking execution.

We introduced dynamic pricing models and shifted emphasis from deal size to cash flow quality. Our focus was to streamline the organization, remove silos, and embed speed into our culture. We met our mid-term financial goals ahead of time, strengthened our balance sheet and improved ROCE significantly—the first markers of our shift away from being a traditional telco.

But transformation is not just about numbers. It’s about relevance. As enterprises accelerated their digital journeys, they needed a new kind of partner, one that could deliver integrated, secure, cloud-first solutions.

We evolved our offering into what we call the Digital Fabric, which is a technology backbone that helps enterprises uncomplicate, innovate and strengthen their digital foundations across networking, cloud, cybersecurity, IoT and customer interactions.

We invested significantly in building core infrastructure and developing proprietary IP on top of it with services wrapped around it. That allowed us to go with differentiated, programmable and intelligent offerings to our customers. Today, nearly 50 percent of our business comes from our digital services portfolio, ranging from CPaaS to managed security and cloud solutions.

And, while it may not always make the headlines, our transformation has not only been about the shift from products to platforms, or only about capability building—it’s also been about fundamental shift in our culture. We’ve had to shed decades of linear thinking and embrace a mindset of continuous reinvention. From engineers to sales teams, the organization has grown more agile, collaborative and deeply attuned to our customers’ challenges.

That’s the part I’m most proud of—not just what we’ve built, but how we’ve built it, with purpose, resilience and a deep belief that relevance is earned every day.

Our journey is far from over. But we are now playing a very different role in our customers’ lives—no longer as a connectivity provider, but as a partner in their growth, resilience and innovation. That shift is our real success story.

How does your global presence shape the strategic value you deliver to U.S. enterprises?

U.S. enterprises today are global by design and their growth increasingly depends on a digital infrastructure that’s fast, secure and intelligent and a reliable global partner to deliver this for them. That’s where our global presence becomes a strategic advantage. Our Digital Fabric, spanning cloud, network, cybersecurity, IoT and customer interaction platforms, enables enterprises to operate seamlessly and smartly across borders.

Over the past five years, we’ve invested over a billion dollars towards capability building. We’ve also made strategic acquisitions like The Switch, a leader in live content production. Our recently launched facility, The Switch@Victory in Los Angeles, strengthens our ability to serve top-tier sports and media brands with end-to-end, always-on media solutions.

Tata Communications media and entertainment services powers some of the most complex, demanding and time-sensitive operations, like Formula 1, where we deliver ultra-low latency media workflows and remote production innovation. It showcases our real-world capability to handle complex, high-stakes deliverables through innovations focused on next generation remote production and low latency video management.

Through Kaleyra, another American acquisition, we now offer enterprises intelligent customer interaction tools that enable hyper-personalized, contextual engagement at scale. These platforms are helping U.S. businesses enhance efficiency, deepen customer relationships and unlock new growth frontiers.

Our infrastructure spans 190-plus countries, and provides a secure, performant network with direct connection to 35 percent Internet routes as customer routes. This unmatched global footprint gives U.S. enterprises local agility with worldwide reach. Most recently, our TGN-IA2 cable system—linking Asia, the U.S., India and EMEA—has been designed to support the next wave of data-intensive use cases, from AI workloads to inter-data center connectivity.

How do you see AI shaping the future of business, both for Tata Communications and those of your customers?

AI is generating both excitement and uncertainty, but for most enterprises, it’s still early days. Many are experimenting, running pilots and identifying where the real return on investment lies. I firmly believe that the next five years will shape how businesses operate for the next 50.

What’s clear is that AI has the potential to be a powerful force multiplier. Already, we’re seeing AI-driven analytics predict network failures before they happen, optimize hybrid cloud workloads, and enable real-time decisions that drive better business outcomes. But this comes with a caveat: AI will place unprecedented pressure on digital infrastructure. Many businesses are unprepared for the scale and performance AI demands, particularly around inferencing and skyrocketing egress costs.

We’ve been evolving our Digital Fabric to be AI-ready. For example, Kaleyra AI, our flagship communications suite, lets enterprises personalize at scale, build no-code assistants and simplify data interaction, delivered over our AI Cloud with superior price-performance economics.

We’re also embedding AI into our own operations, from intelligent service delivery to faster internal decision-making. Our AI Centre of Excellence and AI Academy are cultivating the capabilities to drive not only cost savings, but innovation, customer retention and long-term value.

Looking ahead, AI won’t be an add-on; it will be embedded in how businesses think, decide and grow. The real opportunity lies in helping enterprises harness its power responsibly, securely and in ways that create meaningful, measurable impact.

The tech sector is increasingly recognizing its high carbon footprint and taking meaningful steps to reduce it. How is Tata Communications embedding sustainability into its core operations and innovations to balance people, planet and profit?

Sustainability is no longer a peripheral concern; it is fundamental to long-term value creation and business resilience. At Tata Communications, we view our role not only as a technology partner but also as a steward of inclusive and sustainable progress. Through our Reimagine Strategy, we’ve embedded sustainability at the heart of our business model, aligning people, planet and profit in one cohesive approach.

A key milestone in this journey was securing a $250 million sustainability-linked loan in June 2024, with interest rates tied directly to our emissions reduction goals. It’s a powerful signal: Our financial performance is now intrinsically connected to our environmental impact.

But the ambition extends beyond our own footprint. We’re enabling customers to accelerate their climate goals too. From smart energy meters and virtualized live production to low-carbon cloud services, our solutions help reduce emissions while enhancing operational efficiency. In 2024 alone, for every ton of CO₂ we emitted, our customers avoided 16 tons—showcasing the exponential value of technology done right.

Our Formula E partnership is a real-world example of impact at scale: a 42 percent cut in airfreight for TV production, 49 fewer flights per race, and a 50 percent reduction in onsite personnel—leading to a significantly smaller carbon footprint per event.

Internally, our 3C strategy—Climate Action, Customer GHG Savings and Circular Economies—guides everything from energy sourcing and waste reduction to community development and inclusion. We’ve set bold targets: 20 percent water use reduction by FY30, aiming to become water-neutral, and net-zero emissions by 2035 and we are proud of the progress made so far.

Ultimately, sustainability is not just good governance—it’s good business. It builds trust, drives innovation and ensures technology uplifts not only enterprises and shareholders, but the world they serve.