When Free Means

The free lap­top schemes an­nounced by var­i­ous state gov­ern­ments have evoked a mixed re­sponse from chan­nel part­ners

DQ Channels - - Front page - B SWAMI­NATHAN (swami­nathanb@cy­ber­me­dia.co.in)

Ac­cord­ing to a study by a lead­ing re­search firm, In­dian com­puter hard­ware in­dus­try is expected to grow to rev­enues of $62 bn by the year 2013. Ear­lier, In­dian com­puter hard­ware im­porters used to buy the prod­ucts from over­seas com­puter hard­ware whole­sale dis­trib­u­tors, but now the sce­nario has changed. These days, com­puter hard­ware man­u­fac­tur­ers in In­dia are man­u­fac­tur­ing com­put­ers, pe­riph­er­als and ac­ces­sories within the coun­try it­self. Only highly ad­vanced parts are pur­chased from over­seas com­puter hard­ware ex­porters. The free lap­top schemes as an­nounced by var­i­ous state gov­ern­ments re­cently have brought tears into the eyes of those who de­pend only on the sale of lap­tops. On the other side, those who sell ac­ces­sories com­prise the hap­pier lot.

Lap­top has been the lat­est buzz­word which at­tracts both votes and busi­ness.

Years be­fore some­one car­ry­ing a rec­tan­gle-shaped black bag across the chest used to be an odd-manout in the crowd. It was the time when the so called ‘mo­bile com­puter’ or ‘mini com­puter’ was new to the so­ci­ety. Few years down, it has be­come al­most ev­ery­one’s fa­vorite pos­ses­sion. This trend apart, lately, even gov­ern­ments and pri­vate bod­ies have started is­su­ing free lap­tops for em­ploy­ees and students. This has prompted the chan­nel community across the coun­try to voice their opin­ion on the same.

THE ERA OF LAP­TOPS

Var­i­ous gov­ern­ments in the coun­try are pro­vid­ing lap­tops ei­ther price-free or in­ter­est-free for students and teach­ers. With e-gov­er­nance be­ing one of the key strength ar­eas of all the state gov­ern­ments, one of the prime steps taken by the gov­ern­ments were is­su­ing lap­tops to em­ploy­ees as well as students in schools and col­leges. On the other hand, pri­vate col­leges, es­pe­cially the B-schools in the coun­try, started the trend of pro­vid­ing free lap­tops to all students en­rolling in a given aca­demic year. In to­day’s sce­nario, al­most all the pri­vate B-schools and T-Schools give free lap­tops to their students. Cor­po­rate multi­na­tional com­pa­nies (MNCs), need­less to say, ‘adorn’ their em­ploy­ees with a lap­top.

FREE LAP­TOP SCHEME BY VAR­I­OUS STATE GOV­ERN­MENTS

It has been more than a year since the All In­dia Anna Dravida Mun­netra Kazhagam (AIADMK) as­sumed of­fice in Tamil Nadu. And keep­ing in tune with one of its elec­tion prom­ises, the Jay­alalitha gov­ern­ment, through Elec­tron­ics Cor­po­ra­tion of Tamil Nadu (ELCOT), has been float­ing ten­ders and dis­tribut­ing free lap­tops for students in schools and col­leges across the state. The Tamil Nadu gov­ern­ment has also dis­trib­uted a lap­top, printer and a com­puter-train­ing guide for all the Vil­lage Ad­min­is­tra­tive Of­fi­cers (VAOs). This means, with a to­tal cost of around ` 22 crore and ` 49 lakh, the 7,787 VAOs in the state will have a lap­top, a printer and a user guide. No won­der, the ini­tia­tive has been wel­comed by the lo­cals, es­pe­cially the young gen­er­a­tion, in ad­di­tion to a mixed re­sponse from the chan­nel community. While few say that the move has proved to be a threat for them, some chan­nel part­ners feel that the busi­ness has not been im­pacted since the lap­tops do not come with high-end con­fig­u­ra­tions and have been dis­trib­uted only to the ed­u­ca­tion sec­tor. The rul­ing Sa­ma­jwadi Party in Ut­tar Pradesh had promised to give tablets or lap­tops to students clear­ing stan­dard 10th/12th from the aca­demic ses­sion 2011-12 on­wards. For this,

` 2,800 crore had been pro­vi­sioned to the UP bud­get. How­ever, this scheme could well cost the ex­che­quer al­most ` 4,500 crore, if all of those pass­ing classes 10th and 12th this year, ap­prox­i­mately num­ber­ing over 2.8 mn and 1.9 mn re­spec­tively, avail of the ben­e­fit. This num­ber will def­i­nitely rise next year, keep­ing in mind the in­crease in the num­ber of students an­nu­ally. Be­sides, this scheme would also act as an in­cen­tive for weaker students to score pass­ing grades, thus push­ing the num­ber of suc­cess­ful students fur­ther. Al­though the gov­ern­ment had an­nounced that the el­i­gi­ble students would get the gad­gets by the end of this cal­en­dar year, it is likely to get stretched to 2013 March. Un­like Tamil Nadu, in Goa, the lap­top comes with high­con­fig­u­ra­tions and ac­cord­ing to the part­ners, it does not boost the sale of the ac­ces­sories.

WHAT THE CHAN­NEL PART­NERS THINK?

Mayank Babu Agar­wal, CEO, Agar­wal Net­works, Al­la­habad, while speak­ing about the scheme from the UP gov­ern­ment said, “I am not sure of the suc­cess rate of this scheme so as to think whether it will help in the busi­ness of ac­ces­sories or ser­vices.” Speak­ing on the po­ten­tial of the prospec­tive busi­ness, he said, “Yes. There can be some growth in the busi­ness of ac­ces­sories. How­ever, ac­cord­ing to the ten­der floated, ven­dors have to set up ser­vice cen­ters in the lo­ca­tions they are deal­ing in, which may not be pos­si­ble. Also, even if they ap­point chan­nel part­ners for that, the tar­gets are too high, which can­not be achieved by the part­ners eas­ily.” Ma­hesh R Ku­rup, CEO, Ozone Com­put­ers, re­fuses to think neg­a­tive about the lap­top schemes. He said, “This scheme turns peo­ple to­wards a dig­i­tal life­style, as they can­not go back af­ter get­ting ac­cus­tomed to a life of gad­gets. So, on a long-term ba­sis, this will def­i­nitely help the busi­ness of the part­ners.” Speak­ing on the growth of the ac­ces­sories busi­ness, Ku­rup said, “The sale of de­vices like pen­drives, DVD writ­ers and web cam­eras will def­i­nitely rise with free lap­tops pour­ing in, and the part­ners can in­vest in the ac­ces­sories busi­ness.” Dhiren Mehta, pres­i­dent, Goa IT Busi­ness As­so­ci­a­tion, says, “The ac­ces­sories have no role to play with the free lap­top scheme, as the lap­tops pro­vided have the lat­est con­fig­u­ra­tions like blue­tooth and cam­era. How­ever, if the sale of lap­tops in­creases gen­er­ally, we can ex­pect the sale of ac­ces­sories, as they are given free with many ma­jor prod­ucts. In Ut­tar Pradesh, part­ners are ap­pre­hen­sive about the pos­si­bil­ity of their sales busi­ness go­ing down, once the im­ple­men­ta­tion of free lap­tops/tablets takes place. Ac­cord­ing to Ghaziabad based Ra­jeev Garg, owner of Ad­har Com­putech, “The day gov­ern­ment ini­ti­ates the free dis­tri­bu­tion of lap­tops, our busi­ness will be badly hit. Al­ready, our busi­ness sales are down by 45%, even when Di­wali is around the cor­ner. We do not think this free lap­top scheme will en­hance the sale of ac­ces­sories. As we think most of the students will re­sale their lap­tops in the mar­ket, which will fur­ther ham­per the pric­ing.”

WHAT DO THE VEN­DORS THINK?

Atha Ulla Khan, GM, Ea­gle In­for­ma­tion Sys­tems said, “The lap­top mar­ket is grow­ing ev­ery­where and we are in the phase of ap­point­ing ser­vice part­ners across the coun­try. Re­cently, we un­veiled ser­vice cen­ters in Rishikesh, Ali­garh, and Agartala, and soon Vel­lore and Puducherry will have our ser­vice part­ners too. We aim to cover all the dis­tricts in the coun­try.” He also added that the com­pany has con­ducted sev­eral lap­top train­ing pro­grams for the ser­vice en­gi­neers, and that they strongly be­lieve in lap­top ser­vice as the gov­ern­ments have started giv­ing free lap­tops. “Soon there will be a re­vamped state-of-the-art web­site in place where in­for­ma­tion about our prod­ucts, ser­vices, train­ing dates and feed­backs will be updated ev­ery now and then,” he said fur­ther, adding that Ex­ilient has ac­ces­sories for all the ma­jor brands. Telling that Tamil Nadu is emerg­ing as the lap­top cap­i­tal of the coun­try, he added that not just the ser­vice en­gi­neers in an of­fice but also the busi­ness own­ers them­selves are in­ter­ested in know­ing about the lap­top trade. P Suresh Khanted, CEO, SACO said, “A suit­case worth

` 4,000, which is used rarely, is main­tained by in­vest­ing around ` 300. Then, for a lap­top, which is worth around ` 30,000 and is used throughout the year, cus­tomers must con­cen­trate on its op­er­a­tional ef­fi­ciency and looks. Main­te­nance of a lap­top is like a small four-mem­ber fam­ily where the screen, top, key­board, and mouse pad are the key ar­eas to be taken care of for a long work­ing life. Our saloon will groom lap­tops brought to us,” he said, adding fur­ther that SACO has a wide va­ri­ety of prod­ucts to en­sure that the lap­tops look healthy and beau­ti­ful.

“The ac­ces­sories have no role to play with the free lap­top scheme, as the lap­tops pro­vided have the lat­est con­fig­u­ra­tions like blue­tooth and cam­era”

Dhiren Mehta,

pres­i­dent, Goa IT Busi­ness As­so­ci­a­tion

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