Computers Today June 1998 Country Buzz

June 1998 COUNTRY BUZZ

COUNTRY BUZZ

Do you want Wipro Vanilla? Or, Acer Chocolate?

Soota: Shift in Strategy You can have scoops from both in the same cup. Wipro Acer Ltd., the 55:45 joint venture between Wipro Ltd. and the Taiwanese PC maker giant, Acer Corp., have decided to separate the two brands—Wipro and Acer. The company would reintroduce Wipro's SuperGenius PCs and servers, while spinning off the Acer range of PCs, servers and notebooks as an MNC (Multinational Company) brand. Wipro also sells Acer fax machines and colour monitors.

Wipro joined hands with Acer three years ago, when it decided to drop its own SuperGenius line, which then enjoyed considerable market share. Acer machines have been marketed under 'Wipro Acer' brand name. "At that time, our survey showed that MNC brands were gaining ground, and by 1996, they would command about 70 percent share of the Indian PC market," Suresh Vaswani, CEO of Wipro Acer told Computers Today. "It proved wrong. The locally assembled machines continued to gain market share, especially in the price-sensitive entry-level front. Last financial year, only 26 percent of the 750,000 PCs sold here were MNC brands. Indian branded PC manufacturers (32 percent), and assemblers and GIDs captured the rest (42 percent)," Vaswani explained. Of the 26 percent MNC brands share, Wipro Acer held 6.5 percent, next to Compaq, the best-selling MNC brand with 7 percent share, the CEO claimed.

As Wipro Acer brand was considered an MNC one, Wipro was missing out on the entry-level locally assembled PC market. Now, Wipro's SuperGenius PC will cater to that segment, while the Acer range will be presented as MNC brand. In 1997-98, it sold 36,000 Acer PCs and notebook computers, and 2,000 servers. That fetched Wipro a sales turnover of Rs 265 crore, revealed Bharath Gopalkrishnan, deputy CEO, Wipro Acer.

Wipro Acer aims to top the market share in both MNC brand category as well as in total PC sales. William Lu, chairman, president and CEO of Acer Computer International Ltd., however, pointed out that the joint venture will manage both Wipro and Acer brands. "The SuperGenius machines will be made with Acer components, at the Acer-built ISO 9000-certified facility," he added. Though calling the arrangement "a unique experiment in Acer history," Lu said that the phenomenon of "entry-level PC market being cornered largely by local brands and assemblers' machines" is now true of almost all the Asian countries including China, Malaysia, Taiwan and Korea. Explaining the shift in the strategy, Ashok Soota, president of Wipro Infotech said, "That was then the good strategy. This is for now."

While Vaswani counts on quality in Wipro SuperGenius PCs, he has also priced them aggressively. A 200 MHz MMX, with 32 MB SDRAM and colour monitor, will cost Rs 39,000. The range goes up to P-II based PCs. he expects to corner 3 percent share with this range in 1998-99, with shipment of 30,000 Wipro PCs, besides the Acer range. Acer has already made its full range available in India, including the Intel Celeron-based PCs.

TCS to Meet Tata Teleservices' IT Needs

Tata Teleservices Ltd. (TLL), the licence holder for providing basic telephony services in Andhra Pradesh, has chosen Tata Consultancy Services (TCS) as supplier of its entire information technology infrastructure. The order valued at Rs 150 crore will cover hardware, software, systems integration and facilities management for the next seven years.

As per the contract, TCS will be responsible for sourcing, customising, developing, implementing and running the critical operational and business support systems for TLL's basic telecom operations in Andhra Pradesh. TLL plans to start offering the services from September this year.

Apart from the base infrastructure, TCS will also provide advanced technologies and capabilities for customer care and billing systems, network and traffic management systems, and corporate support systems. Each of these will be seamlessly integrated, "enabling TLL to position itself as customer-oriented, providing the latest value-added services to meet the present and future customer needs," said Serge Fortin, president and chief executive of TLL. According to S. Ramadorai, chief executive officer of TCS, "The project is of national importance as it will be the first of its kind in the Indian telecom sector."

In a parallel move, TLL has already placed an order worth Rs 1,300 crore with Tata Lucent Technologies to supply telecom equipment and CDMA base stations for its basic services network. The network is projected to serve 50,000 subscribers by September this year and 3,00,000 by early 2000.

IT Industry Awaits a Fresh Lease from Budget '98

As the new government gets ready to unveil the Union Budget 1998-99, the IT industry is continuing to chalk out wish lists. The apex organisations of the software, hardware, electronic components and telecom sectors have proposed various recommendations. The software industry forum, NASSCOM (National Association of Software and Services Companies) has the least demands as most were satisfied in Budget 97-98. It is now seeking permission that software firms be allowed dual-listing, that is, on NASDAQ (New York Stock Exchange) and the Indian Stock Exchange.

Reiterating its vision of making India the number one design centre of the world, the hardware forum MAIT (Manufacturers' Association of Information Technology) has appealed for simplification of procedures for the manufacturers. It is demanding reduction in tariff, restoration of duty differential, especially caused by 84.71 capped at 22 percent under ITA, zero duty on integrated circuits costing less than Rs 500 CIF per unit (not made in India), 8 percent CVD/excise on all IT products and components and modification of the EHTP (Electronic Hardware Technology Park).

Electronic Components Industry Association (ELCINA) has asked for reduction in excise duties to the 5 percent level, treat populated PCBs as electronic subassembly and not components, implementation of zero percent customs duty on capital goods as per WTO agreement, etc.

TEMA (Telecom Equipment Manufacturers Association) wants zero percent duty on telecom equipment, 5 percent on imported telecom components, 10 percent on components manufactured in India, 30 percent on sub-assemblies and finished equipment, 8 percent excise duty while duty on telecom software should be brought down to zero.

DEIL Bags $5 m IT Services Contract

Mittal: The support source Digital Equipment (India) Ltd. (DEIL) has bagged a $5 million contract from Reuters India Pvt. Ltd. to provide enhanced technical support for Reuters customers in India. The services provided by DEIL would be subscriber installation and support, help desk, data centre management, inventory management and support for internal and editorial systems.

Informing this, Som Mittal, managing director, DEIL, said, Digital's services will enable Reuters to focus on its customers and address their business-critical needs. "Organisations worldwide are increasingly outsourcing their ever-growing and complex infotech needs, enabling them to focus on their core competencies."

The services provided by DEIL to Reuters will include a comprehensive range of IT infrastructure support services. There is helpdesk support, wherein DEIL will design, build and operate a structured helpdesk equipped with advanced tools and processes; data centre management where DEIL will extend the entire range of services, covering the first level diagnostics and repair and changes to training and repairs along with operational management for all hardware, systems, storage and performance monitoring and tuning.

Besides, DEIL will manage the operations of LAN and WAN systems along with vendor management for communication equipment maintenance. DEIL will also manage the asset inventory, track current assets, etc., added Mittal.

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