By Sramana Mitra and guest author Shaloo Shalini
SM: How active is this market segment comprising Netmagic-type cloud services in India? Are there a lot of startups coming up in that cloud segment?
SB: No, no. Data centers have large startup costs, and there is a [high] barrier to entry. So, I don’t see that Netmagic has too much competition yet.
SM: Are there any larger companies like Tata that are coming up with comparable solutions?
SB: Yes. They already have. All of them have data centers, but that is where nimble play helps. The Tatas are still solving yesterday’s problem. Of course, what is lucky for them is that there are many companies that are still asking for yesterday’s solution.
SM: There is also an affinity with the Tata name. India is a very brand-conscious country.
SB: Those nimbler startup companies that are willing to take a more agile worldview are there in India as well.
SM: But the Tata name helps, right?
SB: Yes, it does. Tata, Airtel, these are some of the big brand names in India, and for their customers we have this entire world of industrial people who don’t want to try too much fancy stuff when it comes to technology adoption. Their mindset in terms of new technology is, if I have something that already works for me, why would I really touch it or change it?
SM: Yes. But that is not an early adopter market, I guess. That is the issue that most Indian SaaS entrepreneurs encounter today – they are not servicing an early adopter marketplace. It is hard to go to market unless there are early adopters in your market who are willing to let you come in and try newer technology-based solutions.
SB: But that is changing a lot, you know. As the Indian economy grows by 9%, it produces a lot of upstarts. IndiaInfoline is one of the upstart companies. It is a 5-year-old company, effectively a 5-year-old large company. Before that it was a startup in a garage. It was 2005 when it became big and hired lot of people. But we still have this mentality of a startup. We believe that if a newer solution or technology is going to get us more money or give us a competitive advantage, we will want to try that new technology.
At IndiaInfoline, we don’t take the attitude of, something has worked well for us for the past ten years, so let’s not try anything new. There are others in Indian context who share that mindset. Yes Bank is a good example of that. It is a bank, but it tries pretty much everything on earth. It’s very aggressive, technologically. I see a very good example in ICICI Bank as well. They were competing against the public sector banks in India. Actually, ICICI has pretty much everything that a consumer needs in terms of banking operations online. I rarely have to visit the bank. I don’t remember the last time I visited a branch. It was probably for a signature required on a tax form; therefore, I had to visit the branch in person.
SM: In your opinion, in your peer group of CIOs who else do you think is an early adaptor of technology and is willing to give a chance to entrepreneurs?
SB: Well, there are quite a few. Shopper’s Stop has recently started doing a lot of thing in the cloud. They experiment with new technology during their refresh cycles, and they are negotiating with someone if I am not mistaken. They in fact have their e-commerce on the cloud. Their e-commerce store is not on their own infrastructure but based on the cloud. Chroma is another, a Tata group company in fact, whose e-commerce infrastructure is in the cloud. But cloud computing is nascent in India. Chroma is still in the process of launching the entire thing. There are many other companies in my peer group, say in the $300 million to billion dollar range, that are quite aggressive in trying new technology, especially in the areas of mobile [devices] and software service models.
SM: We would like to feature more Indian companies that are leveraging clouds and are open to newer technologies and innovative application of new technology. We had Rajan Nagarajan from Mahindra Satyam earlier in this series.
We would like to get Indian CIOs and their perspectives into this series because I really would like for them to give readers visibility on this process. Could you help us get connected to some of those?
SB: That is very good. Sure.
SM: All right. Well, it has been a pleasure to discuss your point of view on cloud computing. In this decade, I hope there will be more Indian startups as well that do better as the cloud computing–based solution industry configures itself in India.
SB: Yes, thank you. Let’s stay in touch.