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Opportunities in the educational segment in India focusing on Intranets, E-commerce and Internet related technologies. Worldwide the hottest growth areas today are in Internet related technologies as applied to the corporate, educational and training areas. Specifically as per IDC reports in 1996, users spent almost $19 billion on Internet and intranet products and services. Although this amount is small relative to the total $610 billion IT marketplace, for a somewhat new market segment, it represents a large volume of user spending. Most important, spending on these products and services is growing at a compound annual growth rate (CAGR) of almost 50% from 1996 through 2000. This growth rate is almost five times the rate of growth of the total IT market during that same period. Clearly, Internet and intranet products and services are at the leading edge of growth in the IT marketplace. Assessing the growth impact of this segment in another way: in 1996, the nearly $19 billion spent on Internet and intranet products and services was equivalent to 26% of the marginal growth of the entire IT industry. By 2000, this segment will generate more than $92 billion in spending, which will exceed the industry's marginal growth in that year. What is the key conclusion from this data? Clearly, that the Internet (along with intranets) is replacing the PC as the engine for IT market growth. This investment, in turn, is being driven by businesses' quest to link employees, customers, and business partners in what we call the wired marketplace. The message to IT suppliers is simple: suppliers that want to outpace the industry's growth in the next several years must increasingly focus their company -- products, pricing, distribution channels, marketing messages -- around the new growth engine. The Indian Scenario In a lead article in Dataquest they have described the Intranet as the most important element in any organization, if they are to stay competitive and achieve work efficiencies. The key to achieving the above lies in the simplicity of using browser-based interfaces over proprietary ones offered by Lotus Domino. The article however does not specify the size of the market neither the specific niche areas, which offer tremendous growth opportunities.  Size of the Indian Market With the advent of private ISP's Internet connections are estimated to triple from the current 500,000 to over 1.5 million by the year 2,000. With a predicted growth rate of 200%, e-commerce will offer more than Rs. 670 crore worth of opportunity by the year 2001. There is tremendous opportunity for all concerned, specially those companies who are already established when RBI regularizes transactions later in the year 2000, and with a stable Government firmly in place, India may finally be entering the digital era. The Educational and Training Segment The educational market offers huge opportunities and is grossly under exploited. With all schools and Universities getting wired and mega projects such as the Vidya Vahini Networks planned, clearly this area can be a goldmine to a properly executed strategy to map this marketplace. Estimating the total size of the market can be difficult as there is no data available, but as a rough estimate even if were to take a total of 25,000 qualified schools and colleges, who would be spending an average of Rs. 10 lakhs then the total spending would grossly aggregate to Rs. 2500 crore . This is a small percentage of the Rs. 25,000 crore(US$6.25 Billion) the country would spend on IT and related products by the end of 1999. This is other than Government and Related spending by Donor agencies. The 8-18 age group is also the most sought after by marketers who would also look very seriously at any new medium offering a guaranteed reach for selling their products. Clearly focusing on the services segment as opposed to total IT spending, if we were to assume that at least 15% value would be associated with the services being offered then we are still looking at a virgin market of over Rs. 375 to 500 crore with a possible growth rate exceeding 100% every year. In the west the in the total cost of ownership of a PC , generally the hardware costs are less than 25% of the costs of training, software maintenance etc., in the Indian scenario the realization that for a workable scenario an integrated solution is the only one which works is slowly dawning in. Aiming our product at the International market as and when it matures and we are able to offer greater ease of use and an out of the box solution we have markets in the Middle East, Latin America, Africa and Southeast Asia. Intranets for Schools Web based teaching methodologies can offer to raise the quality of education in India. It's a no-brainer to say that this will be the only way to close the gap between India's illiteracy and poverty with the rest of the developed world. Education in India remains a mess more so because of the fact that our founding fathers were busier politicking and creating vested interests that wanted our ignorant masses to remain in darkness . The opportunity to improve the quality of education through web based teaching methods cannot be under-emphasized. According to a recent study by Intel Corporation, there are over 75,000 secondary schools in India with only 6% having a decent level of computerization. Internet access is there in only 100 schools throughout India. Cutting edge technologies which can be incorporated in to the intranet will be smart cards to facilitate everything from access to the digital library on the schools Intranet to purchases from the school canteen to checking up results and access to specific services. The open source platform  Looking at the cost and hardware resources of implementing Windows NT based platform for educational institutions, we have finally focused on specializing on the LINUX platform. The results of our participation at IIW 99 were very encouraging. Surprisingly being the only institution showcasing an educational product we were overwhelmed by the response and encouragement. With over 300 valid enquiries and 2000 plus visitors our ischool-2000 demonstration was a runaway success. Enquiries from the Govt., commercial and overseas sector are currently being processed. What should be our Roadmap Our focus is on providing services and products to the educational sector. The product development needs, infrastructure and costs are discussed below. Other relevant issues are: a) Constitution of marketing, product development company etc. We have to identify what image suits us best i.e. Non Profit Activity, Commercial Organization etc. Our development funding and future revenue etc. depend on these issues being addressed. Generally Non Profit activities and Commercial activities are completely different and require radically different strategies b) Identify funding sources, Venture Capital, Angel Investor, Strategic Investor who can give us development synergies, Sponsors, Government funding etc. c) Our marketing strategy depending on the business model we choose. d) Product Promotion e) Delivery mechanisms Depending on the above we should have a thoroughly tested product and relevant manpower to support the same if we are to succeed. Keeping International trends it is safe to assume that being on the LINUX platform will bring us success in a niche area. Competition E-Business and Web Communities developing an on-line educational supermarket One very relevant method to sell our product is to develop a vertically integrated Web Community catering only to the needs of the educational sector in India. Building up traffic is going to take the maximum investment, but sponsoring agencies that may want to sell their products through our site can partly offset that. Besides selling our own products and services this community site can offer the complete suite of educational services, hardware, software, products and anything catering to schools and colleges. This is not to be confused with a portal site like Rediff.com etc, which has an investment of Rs. 25 crore lined up for the next four years. Our site is going to be very specific and will provide a roadmap to schools and colleges who are actively looking for help and guidance in terms of web based teaching methods, on line evaluation, school management systems, equipment etc. as well as case studies of schools and colleges worldwide who have successfully implemented computer technology in all facets. As of now there are no specific Indian Web Communities catering to the needs of the academic community. Honorable mention may be made of Schoolnetindia.com which is doing some work in this area, and has been floated by Infrastructure leasing and finance Ltd. Even though supported by finance major, they plan to pump in more than Rs. 10 crore in this area, some ties ups have also been reported with IBM for bundling their equipment. In the US Spectrum appears to be an online magazine catering to the k7 school segment. They are offering to license this for offline distribution over the school intranet. We can also develop alternative revenue streams offering a unique distribution method for our sponsors rectifying the low availability and reach of the Internet. It may also be advisable to also have an integrated approach to ensure that our content and promotion reach its target market, for this a newsletter with a small print-run of 5,000 copies is planned with some additional content. Recently a Hyderabad based Company claims to be offering a product using powerbuilder 6.0 as front end and oracle as the backend database(This is not Web based). The existing portal sites in education are woefully inadequate, ETH and Dishnet have a site supposedly catering to this segment with no specific content. An interesting site has been created for Delhi's schools at www.delhischools.com. While all these are steps in the right direction they leave several issues to be addressed Funding The success of any web community depends on the total traffic it is able to get from its targeted user community. Our test is to reach out with specific content aimed at decision makers in the academic community and then end users such as students and parents. Historically such ventures take at-east 1 to 3 years to break even and then make money. Our target should be to get initial sponsorships form large transnational's such as Intel, Compaq, HP, Cisco, Nortel etc., as we are on the open source platform, we may get sponsorships from Redhat, SGI, Sun, Corel etc. who have announced support for this platform in the first phase and then approach, the private sector publishers selling books to the student community such as Scholastic, OUP, Vineet Publications etc., finally specific grants may also be possible from State Governments etc. who are now looking at funding the open source platform in a big way. As and when we target the student community larger support may come from a variety of vendors selling products to teens and teen lifestyle. Content This is the most essential part and also the most difficult. If our venture is to succeed then specific content from all parts of the country as well as from the world is necessary. Initially we can publish content appearing in the national as well as the IT trade media. From here we can progress to recruiting volunteers from all parts of India. Technical content can be sourced from the net as well as professional managers who are currently practicing and implementing web based training and intranets in their respective organizations. Timeframe:  With the above manpower and working 10-hour shifts or more we can hope to complete the project within 90-120 days, maximum. Some may be hired exclusively on a project basis. Extensive documentation is available based on our experience in GTBPS, Meerut as well as our experience in testing the market response to a demonstration held at IIW 99. WWW.ITEDUCATION Our Web Community Portal Site could get of to a flying start depending on our recruitment drive. Hopefully we can hope to launch this within 90-120 days.  We want to supplement our Website by a trade magazine. This would be an additional revenue stream and also increase our reach to our very niche target market of high profile educationists, teachers and other decision makers in Schools, Colleges, Government and the Private Sector. 
Business Model Internet Community  |