US-BASED Intel Corporation is more than just the world's largest chipmaker. In its new role as an internet enabler, it is catalysing the movement of companies to the web and faster adoption of internet technologies through a number of initiatives ranging from venture capital investments to strategic partnerships. Atul Vijaykar, who spearheads these initiatives in India as its South Asia Director, spoke to N SHIVAPRIYA on the roadblocks and drivers to the net economy in India. Excerpts: Intel is aggressively moving into the internet space. How do you view the momentum in the Indian marketplace?We see a huge set of opportunities tied with the internet economy. India started late so it will take sometime to catch up. But the momentum is good the CAGR (140 per cent) of internet users is highest here. The world over, business to business (B-to-B) transactions account for 80 per cent e-commerce and business to consumer (B-to-C) transactions 20 per cent. India is also consistent withthis trend. According to Nasscom, B-to-B accounted for Rs 112 crore of the Rs 131 crore e-commerce transactions last year. The potential is huge. India, China and Brazil are among the top three emerging economies for Intel. Will the reasons for adoption of internet be different here? For instance, the most common argument when it comes to purchases over the net is that people can just as easily buy from the neighbourhood grocery store.Time is as precious in Mumbai or Bangalore as in San Francisco. It is not as if there are no grocery stores for miles in the US. Purchases on the net are a convenience factor an urban couple here has the same pressures as in the US. People gave hundreds of reasons why Amul (cyberstore) could not succeed but the fact is that it has.I am convinced there will be a huge internet boom here. What will be the drivers?The drivers could be different for urban and rural areas. Information will initially be the thrust in rural areas. E-mail, which we takefor granted, will be first version of e-commerce. In the US, 50 per cent of households have PCs. That will take a long time here.What we will see is the PCO model there will be more public access points for internet. Cybercafes boom has already started happening in the South and even in Pune. What are the three most important factors hindering e-business in India?The biggest roadblock is poor telecom infrastructure. The second is tariffs they are still a factor hindering overall growth. Duties on everything from CPUs to routers are very high much higher than a country like China.The third is cyberlaws. People are skeptical about e-commerce. Do you think having an IT ministry will solve some of these problems? There have been fears that it might lead to excess regulation rather than growth.It would've been better if there was a single umbrella ministry for IT with related ministries under it now by definition there is potential for conflict. The good thing is that thegovernment has acknowledged the importance of IT. Good, but could've been better. But the government has yet to act on the National IT Task Force report on the hardware industry. What are your views?The task force report is one way to tackle it (lack of a hardware industry). The other way to do it is by relaxing tariffs. The market here is still modest. If tariffs are relaxed, the market will be bigger. This will give more incentive for local manufacturing be it for Acer or HCL. Ten years ago, auto manufacturing was restricted. Then you had Maruti. In the last couple of years, a dozen new players have come into the market. It does not matter whether they succeed or not. They are investing infrastructure and creating jobs here. It also creates a market for ancillary suppliers. Grow the market free economy will ensure the industry develops on its own. To what extent has IT become a management issue?Two years ago, you wouldn't see business heads in an Intel seminar only EDPheads. In the past, IT meant automating payroll and accounts. Now IT is more of a strategic issue. We have CIOs instead of MIS managers. Mass customisation is a marketing person's dream.The internet allows you to do it. Amul had no idea who its customers were it had no direct contact with them. Now it has (through its cyberstore) a direct understanding of the customer. It can react faster to their needs. But are corporates increasing allocation for IT?Overall the trend is very positive. Until recently, corporates were sluggish. SMEs were more active. In last few months, companies are coming out of the rut of recession. The general business environment is positive, a stable government is in place.I am very bullish. What are Intel's initiatives in e-business?We see an expanded role for us as a leading supplier of building blocks to the internet. Implementing e-business solutions will become more critical in the market place. In India, we are working with 25 e-business solutionpartners. In a year's time this should go up to 100 odd. More and more of our venture capital investments are going into the internet area.Rediff, our first venture capital investment, is an example. They have been the pioneers. Network Solutions is another example. They are a systems integrator who are excited about virtual private networks. Intel has said it will set up data centres for hosting websites in India. When is it planned?In the first phase, we are setting up two data centres in US, one in London and one in Japan. After this, in 12-18 months, we will start looking at slightly smaller data centres in emerging economies. It is too early to comment on the pricing.It is a known fact that there is a large pool of talent here and we fully expect to utilise it. There will definitely be an increase in the percentage of software development we do from here. Stock options and good compensation are necessary to retain talent.But they are not sufficient. You need a challenging workenvironment to retain employees.
