by April 15, 1998 0 comments

The ISP policy is still mired in a web of confusion.
Communication facilities continue to remain as abysmal as they were when the entire
telecom revolution thing kicked off. Ecommere is still in the realm of impossible. But
undeterred by the problems of the present, a new generation is laying the seeds of the
next great entrepreneurial revolution in India. And they are all betting on that web of
opportunity. Welcome to India of the nineties. Things are not as much different as they
were in the eighties. But if anything is different, it is the hope in this new generation
that tomorrow is definitely going to belong to them…and of course, that modern-day web
of power-the Internet.

There”s a strange type of elec-tricity in
the air. It”s nothing physical. Nor is it anything to do with the climate. With winter
just gone, Delhi has got into the sulking mood that precedes its inevitable hurtle to
another long hot summer. Laziness is the only word to describe the day and the mood of the
people these days. Yet there is this electricity in the air. It does not generate from the
surroundings, which are decidedly lower-middle class residential. Is it something to do
with the present? Or is it a sign of things to come? For, the building in the lower-middle
residential colony of NOIDA houses the offices of IB Saxena Design Labs. Usually, they
have as much to do with DATAQUEST as does Juhi Chawla. And normally, it would be rather
unlikely to find a DQ reporter here. But these are not normal times. IB Saxena, the
proprietor of the Labs, is the creator of Bababazaar-a supermarket chain that occupies
less space than you would imagine for the kind of products he has on sale, or for that
matter the market he services. For Saxena has beaten the huge amounts it takes these days
to put up a shop in the Capital by taking his supermarket on the Net. The result is
Delhi”s first web-bazaar that can be reached by simply typing out www.bababazaar. com on
any Internet machine. In the four months since he has set up the virtual bazaar, Saxena
has already netted around 400 regular customers and is confident of breaking even by June.

Case Study: IB Saxena Design Labs

Subzi Bazaar That
Isn”t Anywhere…

…but online. is a type of market that should appeal to any adventurous Delhiite. It
stands for what a little bit of innovation and even less money can do. The concept is
simple enough. Create a virtual bazaar that not only stocks the daily items but the exotic
like broccoli and other expensive and difficult-to-get vegetables. Promise home delivery
and ensure that the quality matches the price you charge. That”s what IB Saxena, the
creator of the site, has done. In four months since bababazaar hit the Net, it has already
netted 400 customers and is supplying up to 10 orders a day in the city. Saxena plans to
take his virtual supermarket to Mumbai first and then to other metros, if the concept
catches on. In the meantime, he is talking about creating a web-based cinema ticket
reservation system as well as coming up with local content sites that give an idea of the
city”s happenings. Breakeven can be achieved as early as June.

But for the business to really
take off he needs two things. One, the ISPs. Two, the RBI clearance on online

Variations of this story can be glimpsed in
every single area where VSNL has taken its Internet connection. In Delhi, the small
entrepreneur with the big idea based around the Web is as common as the Maruti on its
roads. In Mumbai, they talk of using the Internet to create a global business. In
Calcutta, it”s about how design and not technology is the main driver. And in Chennai too,
pockets of hope are springing up. Ask the pundits and they will tell you that it is from
these pockets of hope that the next-generation entrepreneur will spring up. Waxing
eloquent on the size, the scale of the opportunity, Anil Batra, Country Manager, Cisco,
says, “you are only limited by your imagination. This is a huge opportunity and it is
up to us to grab it and ride it to success.” Batra himself might not be directly
participating in this race to create the next great businessman, but he knows all about
the potential and the possibilities. That”s why he is excited. And that”s why he comes
alive like what only a man with conviction can when talking about what can be done.
“Who would have thought,” he asks “that the largest book store in the world
will exist only in the virtual form. Tell me of any one book store in the world that can
store the same range of books that this one can.” He is talking about, the
most successful book store on the Internet and by all accounts the largest repository of
books ever. But what Batra is also talking about is the scope of the opportunity offered
by the Web. “Imagination,” he says “is the key. All you need is the right
idea to make your place in the tomorrow”s sun.”

Taking on the Batra bet are a number of
20-somethings who make the new breed of businessmen. Men like Saxena in Delhi and Manish
Sharma, the 26-year-old CEO of DBS Internet, in Mumbai. Young men with a dream, and now an
opportunity to make that dream come true. What sets them apart from the previous breed of
businessmen is the scope of their ambition. For Sharma, the goal is not to become India”s
largest this that or the other. His idea is to grab for his company a slice of the global
market. This he is confident of doing working out of Mumbai. After all, the very nature of
the Web provides him with the opportunity of taking his ambitions global and Sharma for
one is not to lose out on it.

Opportunities Galore
The Internet is beginning to evolve as the single biggest business opportunity to present
itself to the country. There has been nothing like it before. The very nature of this
nebulous society has resulted in a plethora of business opportunities that ranges from the
sometimes mundane to the sometimes mindboggling. As Sharma puts it, “The scope of
doing business today is tremendous, and the beauty of this medium is you do not need to
invest a huge amount of capital. You can make do with the bare minimum, provided you have
an idea that is sustainable.” Sustainability to a large part has been hampered by the
very slow growth of the medium in India. High access charges, coupled with poor service
and line quality has meant that the Internet has been viewed strictly on an experimental
basis by both corporates and as well as individual users. But with some kind of ISP policy
expected to be announced by Sanchar Bhawan in the next couple of months, the excitement of
what can be done is already palpable.

Case Study: DBS Internet

Riding The Bucking

They are young. The MD is just 26 and his
partner 29. Mumbai-based Manish Sharma and Viraj Savant carry the conviction of pioneers
with a mission to make the possible happen to them. They talk tough. They are looking at
growing 600 percent this year. And of maintaining this growth rate for the next couple of
years. Their employee strength has gone from six to 85 in just two years.

They are passionate about what they do. And
this happens to be website creation and hosting for themselves as well as for other
companies. They host the Indian version of popular cricket site They have
also helped Yash Chopra develop his web site. According to Savant, “Chopra used this
site to effectively market the rights of Dil To Pagal Hai in the overseas market.”
They epitomize the Internet evangelist. Their company DBS Internet hosts India”s fastest
commercial web server, thanks to a 128 Kbps link to VSNL, which allows the direct (non
dial-up) access to the WWW from India. Their Online Trading site, StockIndia, offers
trading of shares listed on the NSE.

This is all the more true in the case of
companies who are in the business of providing services around the Internet. Be it
content-site creators, like India World, Rediff-on-the-Net, or India Online, or developing
special focus sites like the NIIT Netvarsity to provide consultation and training-related
activities around the Internet-a lot of people are gearing up to take fullest advantage of
this opportunity.

Creating Content Or The New Age
Style Kids

“There are already more news sites on the Internet today than there are newspapers in
India,” says info freak Debasish Sen. Sen gets most of his news off the Net these
days. Not only is it free, but it also allows him to customize news the way he likes
it best. This way, his paper has nothing to do with films and sports. Sections he normally
avoids in a normal newspaper. Sen had an Internet connection as early as a couple of years
ago, but he still relied on his newspaper. The reason, the Internet then had very little
of Indian interest. Then came along India World, followed in quick succession by a whole
host of other sites that today carry a plethora of information ranging from Sen”s favorite
news sites, to matrimonial and job sites, to even ones that offer a range of recipes. To
help you find what you want, Yahoo! need not be the search engine of your choice. There”s
the suspiciously similar looking and sounding Jadoo that declares itself to be India”s
first official search engine and then there”s Khoj.

Such is the excitement for creating content
sites that there is a new one almost everyday, and going by the response that these sites
receive they are becoming increasingly popular not only with the Indians abroad but by the
expat population as well. Sharma, for instance, says that his sites still receive more
enquiries from abroad. This early explosion, however, is expected to peter out with only
the best going onto become meaningful business opportunities. While it is early to pick
the winners, a look at many of these sites can give a fair good indication. And in most
cases, content need not be the overriding factor in defining success.

Case Study: Newstec

A Paper In Your Mail

Come April 8, and the concept
of the newspaper will undergo a slight change. For coming to you everyday at 3 pm will be
the country”s first email newspaper. A brainchild of journalist Lokesh Srivastava, the
e-paper goes under the banner of Newstec, and is the first electronic newspaper, or
e-paper, in India. What sets Newstec apart from the run-of-the-mill papers is its being a
full-fledged newspaper with photos and laid out in the style of a traditional newspaper.
It will cover major international and national happenings with exclusive reports on
finance, the stock market, film, TV, sports, and health. The best part is that the
subscription charges are only Rs 75 for the entire year. This means one copy costs you
just 25 paise. Says Srivastava, “With the hard copy, you not only waste a lot of
paper, but it also becomes very expensive.” So, if you would like your newspaper
emailed to you, contact

In the early development days of Indian
content sites, less than 5 percent of the total sites receive any ad revenue. This should
be a cause of worry for most content developers as their primary revenue stream is
advertising. Ruminating over the lack of ads in the content sites, Pradipt Kapoor, CEO of
Delhi-based Webworth, says, “The user base today is just too small to interest the
corporates. After all, we have something like a little over 2.5 lakh users in the country
today, that is just too small a segment for corporates to set up a separate advertising
focus on. But these are early days yet and surely as the user base continues to expand,
companies will come into advertising.”

Content companies are also waiting for the
ISP policy. That will be their ticket to the big time in a big way. For, not only will the
policy increase the number of users manifold, the demand for local content will also shoot
up exponentially. Says Meena Ganesh, Director, Microsoft, “The ISPs are going to
create a tremendous demand for local content. For, competition is going to force these
ISPs to look for ways to value-add to their services. One of the ways they can do it, is
give their members access to good content sites.” The ISPs will also create a
scenario where the sites will finally drop their .com address and get (because most of
them are situated in the US) and come back home. Says Ganesh, “Most of the ISPs will
have plenty of extra space on their servers and on their communication pipes. One of the
ways they can take advantage of this resource is by giving it out to content providers at
very low rates.” This means content providers will have access to cheaper bandwidth
and server space. And though the opportunity is there, it is very much dependent on what
happens with the ISP policy and when it will finally be allowed to go ahead.

Web Site Development Or Netting
Corporate World

Content providers though aren”t sitting around waiting for it to happen. Says Sharma,
whose company hosts the Indian mirror of the extremely popular CricInfo site, “For
most of us, these sites are the public face of our company. By developing these sites we
are able to convince companies of our ability to do a good job of designing their specific
sites.” The money today quite clearly lies in web site development for the corporate
world. Be it the public sector Air India or the Amul Cooperative, most Indian companies
today want that address. And if this address comes dressed in natty colors with a fair
amount of interactivity thrown in, then they do not mind shelling out a packet for it.

Though here too competition has meant rates
ranging from as little as Rs 500 per page per annum to a comprehensive web site
development and hosting that could cost anything up to Rs 15 lakh for the full year. A
number of small shop operations are springing up around existing DTP facilities to provide
the page while you wait for services. But Kapoor almost disdainfully calls this the,
“HTMLization of the DTP world.” According to him, “The trick is not in
being able to put up a web site at dirt cheap rates, almost anyone can do that. The real
challenge is trying not to convert the web site into an electronic version of the
brochure. After all, the very nature of the Web is to be interactive and these kind of
sites do not achieve that.” But Viraj Savant, Director, DBS Internet, is a little
kinder when he says, “these kinds of Internet shops also serve a purpose. They allow
companies with limited budgets the chance to get a presence on the Web. They are important
and maybe termed an evolution for most of today”s Data Entry shops.”

Case Study: Am-Pro Information Systems

Delhi”s Own Intranet

Am-Pro Information Systems is using the
intranet concept to provide Delhi”s businesses with its own localized web address.
According to Rajan Vasudevan, MD, Am-Pro Information Systems, “What we are offering
is an opportunity for enterprises in Delhi to build their business on the Net. And this
will be made possible over-riding all the problems of transaction on the Net, attaining
visibility, and reaching out to the maximum amount of users.” The AIS network works
on the lines of a Bulletin Board Service (BBS). It uses the web technology to create a
network of businesses in Delhi, where individual firms have an intranet site. Users can
then dial into the AIS network and access the different sites there. The advantage with
the AIS network is that one doesn”t need an Internet account to access it.

Among the shops online are the Nanz food
store and Multiple Zone, the computer catalog marketer. A similar arrangement is being
made with Teksons and Comdex to run the virtual bookstore. Customers can place orders from
any of the online stores and pay on delivery. The service also provides credit card

Moving up the value chain are the Internet
firms. Small creative domains run either as a spin-off from bigger
business-Rediff-on-the-Net, DBS Internet, Webworth, or set up by entrepreneurs with gold
dust in their eyes. These can be termed as the Brahmins of the web creation trade. Here
it”s web site development that is the buzzword. The Brahmins charge a pretty packet for
their services, but for your money they will take it upon themselves to inculcate the web
culture into your organization. Says Savant, “The challenge for us today is not to
convince companies to have a web site. Most of them are aware of the Internet and are
eager to have the presence. But the problem is most companies see the creation of the web
site in the domain of their IS departments. This means the commitment from the top
management is sometimes not what it should be.”

To get that commitment, the Brahmins take
upon the role of educating companies on them. Says Kapoor, “A large part of our time
actually goes in educating users on the need to keep their web sites dynamic.” The
indications are that they are doing it and doing a pretty good job of it too. Most of
these companies have turnovers of a few lakh at the lower end to maybe a couple of crore
at the upper end. That puts them in the region of scores of other companies in the IT
industry. But what sets them apart is their rate of growth. Savant is confident of
recording a 600-percent growth rate this year. Look at him a bit surprised, and he gently
reminds you that the industry is itself growing at 300 percent and the more established
companies growing at twice the speed of the industry. Yes, it”s over a very small base,
but when was the last time an industry recorded growth in excess of 300 percent?

Ecommerce Or The Big Bucks Story
Ecommerce will be the biggest driver for Internet usage in the country. Without this you
can forget about the Internet really taking off. ecommerce is exactly what the doctor
ordered. That”s the web guru”s answer to a simple question. What will really drive the
growth of Internet in the country? His answer can actually be summed up in a
word-ecommerce. But the greatest-ever driver is just not moving today. Maybe, it needs a
little push. Or more appropriately, maybe all it needs is just a little dose of policy.
Says Ganesh, “Ecommerce
is a huge market that is just waiting to happen.” The operative word here is waiting.
Waiting not for any lack of initiative on the part of the enterprising entrepreneurs.
Waiting not because of a want of a market. But waiting for the green signal from the
government. RBI regulations still do not permit the use of credit card without a physical
signature from the party. This means all Net transactions are out. Also, says Sandeep
Shirodkar, Manager (Web and Enterprise Business Development), Silicon Graphics India,
“The DoT”s archaic regulations of encryptions is one of the reasons why we are really
not sure if ecommerce can take off.” Things have to change, and yes they do. But in
the meantime, the young ”uns are going about the business of business with typical Indian
ingenuity. Bababazaar accepts cash on delivery. `On cards” is a scheme where each of the
bazaar”s couriers will carry credit card verification machines. So you end up paying by
card, but only at the time of receiving the goods rather than while ordering them. This is
true for most elementary ecommerce activities currently underway. So you have NIIT
Netvarsity which accepts credit cards on the Net from every other country but India. In
India, it”s either checks or Demand Drafts. Says Nilanjana Paul, Manager of Netvarsity
“This is definitely not the best way for us to do business. But we cannot do anything
about it till such a time that the RBI regulations change.”

Case Study: ESC

Giving Indian
Industry A Presence

It is not a business house. Neither is
Indian industry its business. But the Internet is and the Electronics, Software and
Computers Export Promotion Council (ESC) is using the Web to drive a better deal for
Indian industry. Its web site already lists over a thousand small
and medium companies in a diverse range of activities. For this it charges the company a
nominal Rs 1,500 a year. Says RH Naqvi, Executive Director of ESC, “The idea is to
provide the smaller companies the chance to have a Web presence.” Because of its
rather large user base ESC is able to effectively advertise the site both online and off.
The results are already beginning to show. Tandon bagged an order for hard-disks through
its home page on the site. Due to being registered with over 200 search engines,
indiansources is becoming the prime stop for many international companies. The site
registers over a lakh hits a month, and this is expected to substantially go further as
the number of companies increases. Naqvi has targeted 5,000 companies by the end of this
year. It does not matter much whether it achieves the target or not, since it is already
the largest listing of Indian companies on the Net.

Change is a word the pioneers of ecommerce
are hoping will happen soon. Says Saxena, “People will really start buying off my
site, if I can offer them the advantage of paying online too. I can”t do that now, but I
am confident that things will change pretty soon.” Note: it”s change they are waiting
and watching for. They are ready, now it”s up to the RBI to take off the one stumbling
block that comes in their way. In the meantime, they are going about giving ecommerce
facilities to users from other countries.

Training Or Creating The Content

Shirodkar says the
demand for Internet savvy professionals will exceed the demand for IT professionals by the
turn of the century. According to conservative estimates, there will be as many as 15 lakh
openings for professionals in various aspects of web content development. This is not an
opportunity the training institutes are willing to let go in a major hurry. Courses are
springing up offering everything from HTML coding to detailed two-year courses on
developing, hosting and maintaining a web site. Says ABPR Reddy, COO, IIS Infotech Ltd,
“This is a huge opportunity for training institutes as the demand for professionals
is going to rise with the increased awareness of this new medium.” Reddy, for one,
intends to ride this demand. IIS Infotech is setting up a country-wide network of websity
training centers to take full advantage of this demand. The other institutes too are not
letting off. NIIT, for example, already has courses that tackle this demand and more
importantly has plans that will see it get a bigger share of this exploding market.

Tale Of
A Growing Tangle
Computers attached to the Internet in 1997 19.5 million
Countries connected to the Internet 135
Registered web sites 650,000
Rate of growth of web sites 9-12 percent per month
Number of users by end 1997 50 million
No. of pages on the web by 1997 200 million
Projected number of computers attached to
the Internet by 2000
180 million

Again, the Net, being the Net, offers two
kind of opportunities to the training institutes. One, is to offer training courses about
the Internet and the other is to offer courses on the Web. While the first segment is
already explosive, it is the second one which has the greater long-term potential. For
developing courses on the Internet have the scope of developing and providing a range of
courses. Also, the market here again is global in nature. Says Paul, “We are looking
at getting a large chunk of the market for casual training in the US and European
countries.” The Netvarsity concept, according to Paul, cannot be too hot for India
where the tradition of being taught by teachers is still very prevalent. The challenge for
sites like the Netvarsity then is get its marketing right. Says Paul, “The cost of
marketing a concept like the Netvarsity on the Net is simply phenomenal. We do not have
the budgets that Net successes like Yahoo! or Hotmail have, so we have to get by with very

Case Study: IIS Infotech

Growing With The Web

"I will go wherever the Internet
goes." That is in the future, meanwhile ABRP Reddy, COO of IIS Infotech, plans to set
up 100 Websity centers in the metros in two years. These centers will focus on providing
education on various aspects of the Internet. Though the target is ambitious, Reddy is
confident of achieving it. He says, "We got over 120 responses from Delhi alone when
he had asked for franchisees. Everyone realizes the business potential for providing
business on the Internet." Regarding turnover, Reddy is confident of touching Rs 50
crore once the 50 centers are up and running. For the first year, he is looking at a
target of Rs 3 crore and the growth continues to be exponential year after year.

In fact, the cost of marketing is the other
end of the web-side story. Yes, the Web is a huge opportunity. Yes, India has caught the
web wave fairly early. And yes, we are going to see companies that evolve into MNCs based
on their web presence. But for this to happen, companies will have to tackle the cost of
web advertising. With close to 7 lakh web sites already up and counting, getting noticed
in the crowd is becoming increasingly a question of how much money power you can put in.
NIIT cannot put in much. So they are also satisfied if their site does not make it to the
top 10 list of most visited sites. Says Paul, "We are using whatever infrastructure
we have in the US to create an awareness about what we are doing. After that we will have
to be satisfied with the slow but steady stream of visitors who hit our sites."

Etcetra Or The Imagination Thing
The beauty of the opportunity facing India is that like Cisco”s Batra says, "you are
only limited by your imagination." So you have the guys at Am-Pro Information Systems
who have created what they call a Delhi-wide intranet. Or you have the website which lists the prices of most computer components and peripheral
devices. You also have and the country”s first email-based newspaper that
can be yours for as little as Rs 75 a year-called Newstec. But, like Shirodkar says,
"There is today a crying need to set up a search agency which is able to search
documents and present it in the format required by the person. Personally, I do not have
time to sift through the thousands of documents that each search throws up." This is
one idea. The other is to become a consultant. After all, how many companies really know
what to do or how to tackle this whole business of business on the Internet. The ideas are
unlimited. And with the Internet, so is the opportunity. It is now up to the new
generation as well as the old to take it up.

Of course, if it was as easy as that, the
country would have seen a whole slew of millionaires or budding millionaires. That there
are not and that the pioneers still function out of bargain basements is because the
Internet is still the opportunity of tomorrow. Today it has the potential, but today it
lacks the scope to realize that potential. The stumbling blocks in the road to Net fame
and fortune are many. From an indifferent service provider, to a lack of proper phone
lines, to the very expensive costs of logging on, to a thousand other factors. But the
challenge lies in overcoming these hurdles and emerging as the giants of tomorrow.


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