The Hindu Business Line : Novatium plans to raise $10-15 m to scale up operations

Chennai, Feb. 3 Novatium Solutions plans to raise $10-15 million (Rs 40-60 crore) to scale up its operations after the successful launch of its low-cost personal computers – Nova netPC – in Delhi and Chennai.

The Chennai-based company recently got an ‘undisclosed’ amount of investment from New Enterprise Associates (NEA), a US-based venture capital firm. It is exploring various options, including other private equity firms. NEA will also have the option to fund again, Mr Alok Singh, CEO, Novatium, told Business Line.

The company will start the expansion from March and hopes to have around 1.50 lakh customers in India by year-end from about just a thousand now. With increasing broadband connectivity, the installed base in India in the next five years could be around 50 million customers for a product such as Nova netPC, he said.

Novatium was co-founded by Mr Ray Stata, Chairman of Analog Devices; Mr Rajesh Jain, Managing Director of Netcore Solutions; and Prof Ashok Jhunjhunwala of IIT-Madras. It has nine patents for its innovation, said Mr Singh.

Nova netPC

Nova netPC is like an appliance. The operator gives the subscriber a keyboard, mouse, monitor and Nova netPC. A cable is drawn into the house and connected to the Nova netPC. The Nova netPC works on a “thin client” concept. It is a small box and does not contain any software or application. On the desk of the user is only an input-output device — all the computing takes place in a central server located elsewhere. The central service has all the storage and guarantees data privacy through encryption, said Mr Singh.

The cost of a Nova netPC works out to about Rs 10,000, which comes further down —possibly by half — if the customer has his own monitor, mouse and keyboard. For a monthly fee (Rs 399 now), subscribers can use applications such as Word, Excel and Media Player.

Novatium has a tie up with MTNL in Delhi, and will explore similar tie ups with other telecom majors across the country. It has forayed into Mauritius with a tie up with Mauritius Telecom and in Thailand with Luxexy, a large business house.

Novatium has around 500 customers in Delhi; 200 in Chennai; 500 in Mauritius and 200 in Thailand.

History of low cost PCs

Globally three to four companies have developed low-cost PCs. However, they are ‘repackaging’ the hardware to make the PC low cost. It is difficult to sustain such a model.

“We have a different model. We have kept the cost of access device low and kept applications and content away from the devices.”

Recently, Intel abandoned its one laptop per child programme, which was founded in 2005 by Mr Nicholas Negroponte, former Media Lab Director at the Massachusetts Institute of Technology.

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