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Global Reach
In 2007, according to Lehman Brothers, India had 24 PC users per 1,000 people, with annual
sales estimated at 6 million units. By contrast, India adds at least that many mobile phone users
in a month. When a Microsoft researcher informally surveyed 300 small businesses—cobblers,
locksmiths, rice dealers, copy shops—he found that only 13% had a computer and only 23% had
ever used one. A World Bank survey of 2,000 retailers showed that only 19% used computers. In
fiscal 2006–07, Indians bought only $1.6 billion worth of software, in part because an estimated
72% of software in use is pirated.
New low-cost business models for getting computing power into the hands of ordinary Indians
have begun to surface, however. The MIT Media Lab’s One Laptop Per Child (OLPC) initiative
and Intel’s Classmate PC (see the Semiconductors section of this chapter) are getting simple, inexpensive,
heat- and dust-resistant laptops and wireless broadband into village schools. The 2004
reductions in tariffs on imported computers have brought global competitors into the market
and have helped bring down prices; HP, Acer, and Lenovo, along with HCL and Wipro in partnership
with Intel, are all offering or planning to offer PCs costing under $300.
Novatium, an Indian company formed in 2003 by Mumbai entrepreneur Rajesh Jain and IIT-
Chennai professor Ashok Jhunjhunwala, offers a $50 thin-client computer ($125 with a new
monitor) that runs on a mobile phone chip set and server-based software for $10 a month.
The Future is Calling
In the early 1990s, India’s two state-owned wire line phone companies (under the Department of
Telecommunications) had a total of 8 million lines and a waiting list of 2.5 million customers. A
new National Telecom Policy adopted in 1999 opened the market to private (Reliance Infocomm,
Tata Indicom) and foreign (Hutchison-Essar, Bharti Airtel Tele-Ventures, Escotel, Idea Cellular,
BPL Mobile, Spice Communications) providers, leading to 38 million landlines and 6.7 million
mobile customers by 2002.
At the end of January 2009, the Telecom Regulatory Authority of India (TRAI) reported 37.75
million wireline subscribers—roughly the same as in 2002—with some 11 million of those lines
in rural areas. The numbers can be deceptive, however, since most rural lines are village public
telephones (VPTs) and located in public call offices (PCOs), each serving many users.
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