The Hindu Business Line : The meat's in the middle

MICROSOFT Corporation India recently outlined a three-pronged strategy focused on increasing product relevance, extending partner reach and strengthening customer reach as part of efforts to address the growing Small & Medium Business (SMB) segment in India.

More significantly, it announced a new software-licensing program that would allow SMBs to pay for software they purchase from Microsoft, over a period of three years.

The program is designed to help small and medium-sized companies minimise their initial purchase cost and plan their software budgeting efforts more efficiently — thus overcoming the resource and HR constraints that SMBs across the country face today.

eWorld caught up with Neelam Dhawan, Managing Director, Microsoft Corporate India, to know more about the program, its perceived benefits and also for the company's strategy on subjects ranging from piracy to retail plans. Excerpts:

Microsoft has announced a new Open Value licensing program aimed at the SMB segment. Have you signed any new client on the program yet?

Not yet. We spoke to the media before we started speaking to our customers. SMB is an extremely difficult market because you don't know where the customers are, which city, which marketplace, and then there is the entire issue of how to address the problems they face... ..You have to go through partners, and that's why you need a big ecosystem to support the plans.

Frankly, I think the concept is very exciting because it is a different way of looking at the problems of an SMB.

What kind of players stand to derive maximum benefit from the Open Value licensing program?

Definitely the medium businesses. That is because if you look at very small players, they have 1-2 servers and 4-5 PCs. For them, the licence cost is anyway less. And if they have a `one server' organisation, they go for a small business server offering, which is attractively priced.

On the other hand, it is the medium businesses — with 50-100 desktops in their organisation and 4-5 servers — that worry constantly about the licence cost. Personally, I think the medium business segment will benefit the most from our announcement.

In the consumers segment, we are seeing a lot of focus on Linux-based sub-Rs 10,000 PCs. Windows-based systems have not broken into the sub-Rs 10,000 league, yet. Why so?

We think we are offering a technology that makes a difference. One that is easy to use, can be deployed by anyone, does not need much assistance compared to a Linux system. Today, with the Windows Starter Edition, we have touched a PC price range of about Rs 11,600 which is very close to the Rs 10, 000-mark.

In fact, the price differential is so small now that, in our opinion, customers will pay a little more for the value and technology that we bring them.

The piracy level in India is extremely high. What measures does Microsoft plan to curb piracy of its products?

Piracy is the biggest difficulty we face in India. If you look at countries that are developed, they respect Intellectual Property Rights (IPR) - be it music, videos or books. In India, we find that for music, video, books and even software, the pirated copies are easily available.

As a country we need to increase the level of awareness on piracy issues. We are spending a lot of time in educating individuals and businesses on why they need to buy genuine software and the benefits accruing from the same. Educating people will have a bigger impact in the long term than just policing. Our study shows that nearly 73 per cent of the software (in India) is pirated.

The problem is acute in case of small organisations or home users. Many small organisations are not even aware that when they copy software it is piracy.

Have you set any target with regard to bringing down piracy levels on Microsoft products?

It is tough to quote a figure, but we are hopeful it will come down as we focus on explaining to consumers the advantage of buying genuine software, the ease of operation, and the support available on such products. We are telling small organisations that depend on one server that they must purchase legal software because the infrastructure is their lifeline.

The situation has improved a lot in the last few years. We used to see high levels of piracy across all segments earlier, but there is more awareness.

What will be the priority areas for you over the next six months?

One priority area will be the SMB market. We also see ourselves well established in the enterprises and Government segments. We are also focusing on new application areas such as rural computing. That is a new initiative for us to participate with Government and work on upcoming projects.

In addition, we are looking at ways to reach out to consumers, to ensure that each individual at home gets an experience of Microsoft products.

When it comes to the consumer segment, what `retail strategy' would you adopt to reach out to the users in India?

We plan to do a lot of things to reach out to consumers, be it advertising or promotion or retail. Our retail initiative is not just about consumers coming and seeing Microsoft products and their functionality. It has an ecosystem around it.

There must be a PC available, an Internet connection, at an affordable EMI rather than a down payment. We have the concept in mind, but need to put the ecosystem in place before we talk about it

What is driving the `retail strategy' for Microsoft?

It is the fact that we have such good products. For instance, look at Media Centre... here is software that allows consumers to convert their PC into an entertainment hub by acting as a PC, TV, DVD player and a radio all bundled into one. Moreover, look at how technology is changing our lives — we use digital cameras, the photos are downloaded on PCs; we use Media player and music goes on PCs.

Going forward, PCs will become the hub where photos, music and video clips will reside. We have to give our consumers the ability to put all these things on the PC.

We are still working on the retail strategy, and all I can confirm at this point is that it will entail `centres' where consumers can come and see Microsoft products at work.

moumita@thehindu.co.in

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Picking on the kernel...

For some `live' action

Search to share

In the loop

`System is slow, hangs frequently'

Upgrading system memory

Our focus is offshore for top clients

The meat's in the middle

`This is how we're doing it'

Unfairly placed

Quiz

Blend buy-leaning with build-leaning

Cartoon