ISP Rush Gains High Momentum  Government's new Internet service provision policy
seems to have unleashed an entrepreneurial spirit among Indian private companies.
"The Net technology and the services that it can generate are peculiarly adaptable to
India's way of working," says Ashok Desai, managing director, Silicon Graphics
Systems India. "To start with, it allows micro-scale enterprise, and that's the way
we are geared." No wonder, not only the conventional telecom and infotech companies
but also small-time cable TV and other lesser-known companies are clamouring to get into
this segment.
The first private ISPs are likely to start offering service
in the next two months but it would, at least initially, be restricted to a few big
cities. Pricing strategies would differ widely, though the prevailing rates of Videsh
Sanchar Nigam Ltd are a benchmark for some. British Telecom vice president Ravindra Sharma
says pricing will be decided by market. Siticable, and Hindujas-promoted IN Network in
Mumbai lead the pack of Cable TV companies planning to join the private ISP brigade.
Siticable, owned by Zee-baron Subhash Chandra, is vying for category-A licence covering
the entire country. It will use its coaxial as well as fibre optic network in Mumbai to
offer its Net services to Mumbai surfers. Other suitors for an all India licence include
Aptech, Acme, Radhika Computer Service, Modi Entertainment Network and Dishnet, to name a
few.
Venture Capitalists
Making a Beeline to India
Global software venture capitalists want to hyperlink to
India's infotech potential. The National Information Technology Task Force is flooded with
requests for setting up venture capital fund firms in India with a special focus on
infotech. Task Force convenor N. Seshagiri says many American and Japanese
companies--including Sumitomo--have forwarded their letter of intent to the panel. Others
in the fray, with a sizeable corpus, are the Venture Capital Association of NRIs and the
Venture Capital Bank. Both are based in the US.
In addition, the southern states, Andhra Pradesh, Karnataka,
Kerala and Tamil Nadu--which are at the forefront of ushering in a cyber revolution in
their respective fiefdoms--have already announced their intention to set up venture
capital companies for young entrepreneurs in the IT segment. The only hitch is that the
Task Force, a high level body that it is, can only make recommendations to the Government
but cannot implement them. Nevertheless, with the Prime Minister's Man Friday, Jaswant
Singh, as the chairman of the Task Force, the NITTF could have a greater say in policy
matters.
The venture capital fund proposals from overseas have been
passed on to the Prime Minister's office for suitable action. The prospective entrants may
have to enter into collaborative agreements with the domestic financial institutions as
suggested by the Task Force. The Task Force is eager to welcome venture capital funds into
India, in the hope that it would plug the huge gap in investment required to achieve
export targets of $50 billion in software and $10 billion in hardware by 2008.
CA Wants to Diffuse Slowly
Into India
 Computer Associates Inc., the $4.7-billion
US-based software major, is about to ink deals with Indian software majors Satyam Computer
Services Ltd, Infosys Technologies Ltd and NIIT Ltd. Confirming this, CA president and CEO
Sanjay Kumar (see photo), on a whirlwind tour of India last month, said that the proposed
agreements will form the basic framework of CA's three-pronged business strategy: software
retail, development and consultancy services across India.
Kumar's tour also included Calcutta where he met corporate
leaders and officials of the West Bengal Industrial Development Corp. Calcutta's Salt Lake
complex has a $93 million-joint venture with the Chatterjee Group, engaged in developing
software for CA's worldwide operations. The CA chief expects the JV to bring in around
$100 million for CA in the next five years.
In Calcutta, the CA chief also addressed the Connectivity
India '98, a networking show organised by the Bangalore-based Microland Ltd. He seemed
bullish about software scrips which have been recently incorporated in Indian bourses.
Birla Group Aims High
Taking a chip out of infotech companies, the K.K. Birla Group
is scouting the globe for acquisition of software firms, apparently to bolster its
business interests. The multi-product group already has a software division, India
Software Group (ISG), which is a part of its Chambal Fertilisers and Chemicals Ltd.
ISG president P.R. Shankar Kumar says it's time to cash in on
the Indian infotech boom. ISG is looking for prospective takeover targets in Europe and
the US. The focus is on companies engaged in workflow, document management and graphic
handling systems. The company has already set aside $15 million for the proposed
acquisition.
Kumar is interested in a complete takeover. He thinks it will
be less painful in terms of marrying different company cultures. ISG has been already
holding preliminary negotiations with a few companies for some time. Bullish about the
future, Kumar plans to hive off the software division in the next two years. Recently, ISG
set up a software development centre, spread over 12,000 sq. ft, in Chennai.
Tivoli Director Makes
Indian Debut
 The roadshows have begun. Tivoli IT
Director, a total software package solution claiming to provide smart management for the
small business, made its debut in India last month. The tools included in the Tivoli IT
Director include application-, inventory- and network management, hyper automation,
central point of control, software distribution and remote control.
Tivoli IT Director from Tivoli Systems Inc. belongs to the
IBM stable, and is being marketed in India though Tata IBM Ltd. Country manager Pankaj
Dubey claims that the new offering is "not a repackaging of existing product line but
freshly developed." The product took two years for development, adds Chaz Vidal, a
specialist flown in from the Philippines for the show. According to Vidal, Tivoli's latest
offering is highly scalable with cross platform systems management solutions. IBM launched
the Tivoli IT Director in April. It has been shipping from July last.
Dubey says the system with a server and 20 nodes will cost Rs
4.7 lakh. And every additional 20 nodes would tot up the total bill by Rs 1.2 lakh. The
initial response, according to him, is "positive" and he does not expect any
sales before the new year. Dubey emphasises that he is not interested in "the
conventional small and medium businesses." His target will be companies which are
already into information technology and facing problems in managing them efficiently. For
Dubey, any company with a minimum of 50 to 100 desktop computers in a networked
environment is a potential company.
Pro-active SAP, Baan
They believe in doing business, but not without looking at
the future. Global Enterprise Resource Planning (ERP) software majors SAP AG and Baan Co.
are sighting top-notch management institutes in the country, to lock in captive potential.
Last year, SAP India Ltd, the two-year old subsidiary of the German giant, signed a formal
arrangement for a higher learning programme with the Indian Institute of Management (IIM),
Bangalore. This October, it did the same with IIM-Calcutta, offering its R/3 course
material free of cost for inclusion in the institute's educational curriculum. In the same
way, Baan has tied up with the Management Development Institute (MDI) at Gurgaon, near
Delhi, for collaboration in research and education.
Both global majors hope that this programme will help develop
a resource base of trained professionals. If SAP and Baan want more business for
themselves, they realise they have to create and plug the demand-supply gap of skilled ERP
professionals. SAP India is currently on the look out for collaborative efforts with other
institutes in Delhi and Mumbai. |
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