TECH TALK: A New Mass Market (Part 2)

Think of a new enterprise infrastructure in which instead of a thick client and thick server architecture, we have a thin client and thick server architecture. Who needs 1 Ghz processors, 1 GB RAM and 40 GB hard disks and flat-screens on the desktop? Those who are using 3-year-old desktops computers. Where are these 3-year-olds? In the existing computer-rich markets of US, Europe and Japan. They have the money to spend to do their upgrades. In fact, the developed markets of the world today have reached saturation points when it comes to the computer base. Dell estimates that there are at least 40 million computers in US corporates which are more than 3 years old. These are computers which are in perfectly good working condition. Yet, driven by the inexorable cycle of the upgrade economy and the need for more processing power, companies will upgrade their systems. And therein lies an interesting emerging market opportunity.

The disposed computers create an environmental problem. But they can be manna for the ones who have never been exposed to computing. The problem lies in finding the right set of software to run on these, in todays context, ancient computers. The challenge therefore is two fold: building out a second-hand computer value chain which takes computers from the developed markets of the world to the emerging markets of the world and from computer haves to the computer have-nots, and creating appropriate software which can leverage this computer base.

There is another option: use technology in todays handheld devices and extend it to build low-cost desktops. Handhelds are on a trajectory of rapid improvement. However, this needs some RD, which requires money. One benefit of leveraging second-hand computers is that their cost has already been written off both in terms of RD and in terms of usage. Whichever approach is taken, the key point is to make computers available across emerging markets at price points of less than USD 100.

Think back 10 years to the world of Novell Netware or even further back to the world of minicomputers, wherein everything was centralised on the server. The difference between those worlds and our current world is that today, we have more than adequate processing power in even the three-year-olds to run almost all applications with an acceptable level of performance using a graphical user interface (GUI). There is one more important difference: the Internet and its set of standards. What the Internet has done is proliferated HTML, HTTP and TCP/IP for communications. A Web browser is good enough for doing most things on the desktop today. Local storage is no longer a critical requirement for every desktop.

Part 1 | Part 3 of 5 will be published tomorrow.

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.