TECH TALK: Server-based Computing: Complementors

To build a deep and pervasive platform needs complementors organisations which can build around the core platform and thus enhance its value. The base platform in this case — the Linux-based Thin Client and Thick Server is available in Open Source. But to make it valuable needs many entities to come together to build a grassroots, bottom-up movement. Here are examples of some complementors and how they can make a difference:

Assemblers: Worldwide, the white box sellers (non-branded PC sellers) account for over 50% of the market. In India, their share is 46% for the year ended March 2002. These PC Assemblers have relationships across the spectrum and are thus a key component of the IT value chain. They can not only create a viable used PC market through buybacks from their customers, but more importantly they can drive adoption by the end customers through the support services they provide. For assemblers, the attraction is increased margins. On new PCs which have become completely commoditised, most assemblers make less than Rs 1,000 per unit. By adoption the server-based computing platform, they can not only sell more units (by a factor of 5-7x), but also make a percentage of the software and support charges.

Software Developers: The server-based computing platform needs applications tailored to local businesses and languages. This is the opportunity which the Indian software industry has been waiting for the creation of a domestic applications market. Companies can build enterprise applications frameworks or components that can now be leveraged by a much wider base of customers. Indian can also provide a huge fillip to the open source movement by contributing back to the community.

Communications Companies: Internet connectivity is going to be an important aspect, since email, instant messaging and web browsing are key applications on the desktop. Telcos, ISPs and the cable companies thus have an important role to play in providing good connectivity. Their dream of tens of millions of new customers can become a reality. An interesting aspect here is to think in terms of using WiFi for the last-leg of the connectivity pipe. As one of the readers (Mohan Narendranath) pointed out, the re-use concept can be extended to 802.11b cards which are going to be available aplenty within the next few months as users in the developed markets shift to the higher speeds of 802.11a and 802.11g.

Training Institutes: In the past two years, the training centres in India have been decimated because of the slowdown in software. The result is that there is already an infrastructure set-up in terms of computers and instructors but few students to teach. If they can start offering training programs for Linux and the various applications (Evolution, Mozilla and OpenOffice), they can now attract a whole new set of users the ones who begin adopting the Thin Clients. In fact, a 1-day training program can be bundled in with the purchase of a Linux-based Thin Client. This market may be smaller in terms of course duration, but is many times larger in terms of size.

Government: Three things are expected from the government if it wants to be a complementor: agree to use Linux and only Linux for its users (the slogan can be: Independence from Proprietary Software), eliminate duties on the import of used PCs, and open up the 2.4 Ghz and 5.7 Ghz spectrum for use without the need for licences. If they do this, entrepreneurs will take over. Anything else the government does would make it an obstructor!

India and Indians has an opportunity to create a new and cost-effective computing platform through the use of Linux-based Thin Clients and Thick Servers. This can later be extended to the worlds emerging markets countries like Brazil, Mexico, Nigeria, China are likely to have the same set of challenges we face in terms of the cost of computing. What is needed is a change in mindset to thinking rather than trying to invent new things, let us see how we can best use the existing technologies and assimilate them better anyone else in the world.

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.