Every year MIT’s Technology Review comes out with an annual list of awardees, TR35. These are individuals who have broken new ground in the field they are working on be it genomics or semi-conductor and most importantly they are under 35 years of age. This list is very well respected among the scientific community, and the awardees are guaranteed their fifteen minutes of fame almost instantly.

“The only way of discovering the limits of the possible is to venture a little way past them into the impossible,” go one of Sir Arthur C Clarke’s law. The renowned fiction writer and futurist died yesterday in Sri Lanka, bringing to end one of the most colorful and eventful of lives. I haven’t read any of Sir Arthur’s novel, only a few short stories (including the 10 word story he wrote for the Wired Magazine, “God said, ‘Cancel Program GENESIS.’ The universe ceased to exist.”).

But I have always been fascinated by him, a man who spoke about distant stars and alien beings. It is probably because at a primal level, we all are fascinated by the universe that shifts over our tiny heads day and night. Everyday, when I peer into that starry sky, I think of the millions and billions of years that have passed. That tiny spot of light, indicating a star, quasar, or whatever, has travelled through billions of years, infinite space and today I am able to see it. This star, quasar or whatever, might not even exist now. Or for the matter the whole sky might be so very different at this given moment, but then I will never know. Some other soul, probably some billions of years later would probably be standing at some point (surely not Earth, because it would cease to exist by then) in this galaxy and when he/she or it looks up would see how the universe looks right now for us. For this very reason, I like Sir Arthur, he humanised science fiction. In many ways, he liberated our fantasies, gave them wings on which they could fly.

Oh how I wish I could have spent a life writing on the mysteries that surround us all over. But the best that I could write is how an amazing Indian firm is digitizing the universe, turning the stars into simple bits and bytes. I had done this story a year and more back and on learning of Sir Arthur’s death, I was just thinking about the sky and the moon, when this story came to me. And for this very reason, I am uploading this story. He had stated once that he would want his epitaph to read; ”He never grew up; but he never stopped growing”. May he continue in some way his universal journey, in some form or the other.

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Digitizing the universe

It is the most unlikely of places to find a quote from gastronome Jean Anthelme Brillat–Savarin. The eighteenth century French epicure had commented to the effect, “the discovery of a new dish confers more happiness on humanity, than the discovery of a new star.”

The diners at the canteen of of Inter University Centre for Astronomy and Astrophysics (IUCAA) look up at the placard (with the quote on it), smile to themselves and continue with their food quite unperturbed by the supposition. Without a micron of a doubt, not all agree with the Brilaat–Savarin because at IUCAA, life is all about finding newer galaxies, tripping over black holes and extrapolating on the nature of things in the ever so distant universe.

Established in 1988, IUCAA’s mandate was to carry out research in theoretical astrophysics, cosmology and in observational astronomy. With all the major universities and research institutes in India and abroad collaborating at IUCAA, the center has become a vast storehouse of learning and research in the field.

The genesis of VO-I
But it was at the turn of the millennium that IUCAA came into international limelight. Around that time, the Virtual Observatory (VO) concept was taking shape internationally and Ajit Kembhavi, a renowned figure in astrophysics and astronomy, heard about the project from his colleagues based on the international shores. Kembhavi was immediately hooked on by the VO idea and it does not take rocket science to figure why?

Over the years, the biggest problem faced by astronomers and researchers alike is that of making accurate celestial observations. Guesstimates vary on the number of celestial objects in the universe, from a few hundred million to few thousand billions, making it harder for astronomers to really pin down their observations.

To make such observations, astronomers require high-end instruments capable of peering into the distant space and the only place they are available are a few observatories across the globe. There is a long list of people who have booked slots at such observatories. VO intends to solve this problem of demand-supply permanently using the latest that computing power has to offer.

Every night, as high-powered telescopes scan the sky from different angles, data collected from them is digitized and uploaded on a central location from where it can be accessed by researchers. Sounds fairly simple, except for the fact that the data generated by these surveys runs into terabytes (1024 gigabyte equals one terabyte).

“For instance, the Sloan Digital Sky Survey (SDSS) project generates a few terabytes of data every night,” says Kembhavi. Thus, when SDSS– DR3 data, running into a few terabytes, was to be shipped to IUCAA in Pune from John Hopkins University, the university bought special hardware drives and then shipped them manually to India. “Even with a high-speed connection, it could take around a month to transfer this data via Internet,” explains Kembhavi.

The ability to analyze this humongous amount of data is a bigger challenge than storing it. And that is where India, precisely Indian IT, comes into play. Kembhavi was well aware of the data issue and came up with the idea that India will contribute to development of new applications and technology that will aid in storage as well as analysis of data. On this basis, India became a founding member of the VO program and VO-India or VO-I was born.

Public and private
If the concept was brilliant, the implementation was even more radical. To achieve his objective, Kembhavi enlisted the support of Anand Deshpande, CEO, Persistent Systems, an IT company based in Pune.

“I knew Deshpande from the days when IUCAA provided basic e-mail facilities, limited bandwidth and electronic access to some journals to several university centers, several years ago. That time, Deshpande used to visit the campus to access his e-mails. Thus, when I discussed the idea of collaborating on the project, he readily agreed and that is how we got going,” says Kembhavi. With funding from the Ministry of Communications and Information Technology, the project got rolling.

Persistent pitched in with its software engineers and set up a dedicated team to develop applications and work on new technologies in close collaboration with the team at IUCAA. The results have been quite heartening till date: VO-I has come up with applications like VOPlot, VOStat, VOTable and others.

Of the lot, VOPlot has received the maximum acclaim. It is a stand-alone system with high-end graphic user interface that can be downloaded from the IUCAA server. The tool has been integrated by many databases used in the study of stars and is available in three versions, VOPlot, VOPlot 3D and VOMegaPlot. The gains are mutual according to Kembhavi.

“We gain from their (Persistent) software expertise and they are gain from the challenges thrown up as huge amounts of data that needs to be managed and analyzed,” he said. Even, Microsoft is taking a keen interest in the development of the VO project globally.
It is not astronomy that can benefit from the development of such tools; there can be quite many commercial applications according to Kembhavi.

“Any work that requires high amount of data analysis can use these tools like VOPlot and VOStat. For instance, population census is one such field or for that matter retail market analysis, where there are huge number of small transactions that need to be analyzed,” adds Kembhavi.

Looking forward, VO-I has become a potent force in the global initiative. Kembhavi is also quite excited at the prospect of advancement of science. Using these tools, a lady researcher was able to discover a sub-dwarf star, “the second known one in the galaxy,” exults Kembhavi.

Sitting at his comfortable office, full of books on astronomy, physics and IT, Kembhavi is dreaming up newer projects, grander in design and objectives. In spite of spending so many of his years gazing at the heavens, Kembhavi is still immensely fascinated by the stars and planets. He is of the view that we (humans) are not alone in the universe, who knows with the aid of tools developed by his team, there is finally proof of it.

Kembhavi is trying real hard.

Shashwat DC

Throughout my coversation with Douglas Engelbart, not once did I come across any negativity within the grand old of computing. Honestly, I had expected him to be angry, to be unhappy, to be frustated, the way world has really treated this genius. After all, most of the amazing computing innovations (from hyperlink to GUI) today can be traced to that December night in 1968, the day of ‘mother of all demos’. Engelbart not only saw the future much before every any one else did, but also gave us a glimpse of it. In many ways, he is the Nostradamus of the IT industry. Nonetheless, while people built upon the foundations laid by Engelbart, he was relegated to the sidelines. Even when he confesses of being a bit sad, he blames himself for it. “Well it is your fault Doug, you don’t know the rest of the world well enough to be able to be able to communicate and make them see what you do,” he says. Nonetheless, even today Engelbart comes to his Bootstrap office and continues to work on projects that promise to revolutionize the future.

Getting to speak to Engelbart, was a dream, especially, because, he spoke to me in detail. I was asking him rather inane questions on Collective IQ, and like an indulgent grandfather he would patiently answer all of them. Because of such ocassions, the chance to interact with a pioneer like Engelbart, that I truly love my job. Sometime during our conversation, I informed Engelbart that my name (Shashwat) means immortal, and he retorted that his surname Engelbart in Germany, means an angel’s hair. “Which is also immortal,” he quipped. I hope that he continues to stay with us for a long time, much like an angel’s hair, and sees his dream of Collective IQ become a reality.
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‘Collective IQ is a capability level, there is a long road ahead and a great deal of evolution is needed’

’Twas a wintry December Monday in 1968, when 43 year old inventor Douglas C. Engelbart dressed up in formals took to stage in the Fall Joint Computer Conference in San Francisco. Wearing a headset, Engelbart gave a demonstration of a project titled “Augmenting Human Intellect” that he and his team had been working on at the SRI Campus in Menlo Park, California. In some 90 odd minutes, Engelbart completely changed the way people perceived and would perceive computers henceforth. Through the numerous inventions that debuted that day, like the hyperlink, graphical user interface, an online system – NLS, object addressing and dynamic file linking, and amazingly communication over a network with audio and video interface (later to be known as video-conferencing) and not to forget the groovy mouse. By showing how he could manage his shopping list (frequently updated by wife) on a computer screen through links and charts, Engelbart liberated the computer from the labs and brought it within the realms of what he called the ‘knowledge worker’. Little wonder Engelbart’s demo has ever since been referred to as the Mother of all the Demos.

It has been some 40 years since that penultimate night and the world has changed so much. Still Engelbart continues to toil. The man, who shared tomorrow some 4 decades back, has still a lot to show to us. Renowned as the father of the mouse, Engelbart is without any doubt one of the greatest inventors of computing. But more than an inventor, he is also a philosopher, who finds metaphysical strains in his work. Even now, he is striving at the Bootstrap Institute, trying to show the world how human intelligence could be augmented through collective effort, what he calls Collective IQ. In a detailed discussion with Dataquest, Engelbart shared his vision of the future and also his hope that India would be a part of that vision. Excerpts.

All those wonderful things that you demonstrated on 1968 are becoming real now. How do you feel about it, in the sense is it great to know that you were so ahead of your time or are you saddened by the fact that computer industry is achieving now all the things that you had laid out way back then?
To be truthful, it really makes me feel inadequate. I have often wondered as to why I couldn’t explain all those advancements in ways that it could be easily understood by all. It is an overwhelming thought.

Nearly a decade back, there was an event organized that spoke about Douglas Engelbart’s unfinished revolution. What do you think is the current state of that revolution?
I don’t have a short answer at all. It is trudging along, and what I miss is a chance for direct dialogue, I think about the basic concepts of what I call “augmenting our collective IQ”. I would really welcome a direct dialogue on what is collective IQ and what is augmentation believe that it is extremely important for human society to boost its collective IQ and look. I collectively at the problems and issues we face.

It was in the sixties that you had spoken about augmenting human intellect through the use of machines. At times the implications of the same are not very clear, if you could talk of it?
The whole human society is basically divided in terms of labor, in the sense, some people create food, some manage information, and other disseminate it. Just imagine if all this complexity could be done away it, and a grand system could tap the capability. Great things achieved by humans have largely been a collective effort, take for instance the invention of language, writing, books, the human evolution has been dependent on collectivism. Even today we can see a glimpse of collectivism in the way companies or governments are run or even the World Wide Web. For instance, global warming is one such issue facing all of humanity and how well is it recognized but then how well it is being discussed at a global level…

How do we move towards the state of collective IQ?
Collective IQ is a capability level, there is a long road ahead and a great deal of evolution is needed. I have been studying literature and articles that talk of such capability and I hoped to hear echo of it by now. You must have seen from time to time these diagrams of the different functionalities that they have isolated in the brain. For instance, there are portions of brain that handle the sensory input, the others that handle logical reasoning. Haven’t you wondered that how effortlessly our brain processes information from different sensory organs be it audio from our ears or visuals from the eyes.

How is your work at Bootstrap Institute that you founded some years ago, progressing?
It has just faded away a lot because I am essentially working alone and by myself. Am old and not a very effective coordinator of things. I don’t really know what I should do to make more effective use of my dwindling energies. Many decades back with my team, I was the first one to build a hyperlink, I had wanted it to be able to address any object, and similarly I want to have discussions and debate on things that could take place. I remember the time when we were working on the GUI, one big domain was the different ways in which you could view a document, significant change to how you look and study a document. For instance you could see the 1st line of every paragraph in the document or you could view all the content. There could also be many ways to jump within a document, for instance a jump could be based on the occurrence of the given word.

The computer can be truly creative device, it can provide a whole many ways to give a symbolic presentation of the knowledge that we are trying to deal with. What the human brain can achieve with visual and auditory perception, so can the computer without significant challenges. Honestly, we have only started with how the computer can augment ones capability, understand and communicate..

What is the status of the Open Hyper Document System that you had proposed?
All these things have become stationary; because I am 82 and can’t keep running about to coordinate things. Why don’t you get India to get moving on augmenting human intellect and I could join in. I was very impressed a year or so back, the Prime Minister of India made a declaration that India will kind of look at boosting the collective IQ. The more I think about the size and opportunity and the general reputation that India has for intelligence and capabilities, the more hopeful I become of the potential of the country has. I don’t know of a country is as unusually placed as India, with its huge and educated population. It will be truly wonderful, if we could get something going in India. I hope that India will take a lead in the research of Collective IQ and the rest of the world will follow.

At times, I feel embarrassed that I come to office day after day and haven’t done much about these projects. Why don’t we get it going? How soon can I start hearing from India that Collective IQ has become a nationwide movement.

What do you feel about the commercialization of technology, the rush for riches and patents?
I am not sure if there is any real option for the society except commercialization. What incentive would the inventor have to invent or how will an innovator be paid. I wish though that there were a lot more freedom for evolution and free. I just shrug and take things as they are. I remember people talked me into patenting the mouse. But I did not patent other things. Imagine what would have happened had I patented the idea of the link (hyperlink). Commercialization should not be the be-all of everything.

How do you assess the current level of technology with powerful PCs with broadband Internet?
I think it is very good and is touching a lot of people in the world. I think the valuable thing to do further research on how computing can be made more pervasive. I think the computer has far greater potential than merely emulating the page or something, but that is what is stuck in the paradigm of today. I don’t have a research team and I wish there was some way to get research going on the way that computer technology could provide new ways to read and modify text that books don’t provide. I feel there quite much in the way of effectiveness that could be done.

You were also involved with the precursor of the Internet?
Yes I was part of the ARPANET project. At that time, the idea of the Internet was much different from what we have today. The pitch was like you have some data on your machine and someone wants to access it, it could be done through the Internet. I remember two university researchers were there when the discussions were taking place and suddenly one turned to the other and asked “What is there on your computer that I could use?” And the other retorted, “Don’t you read my reports”. Thus genesis was simple. What I proposed to set up was a Knowledge Information System.

I also read somewhere that you also hand a small role in the formulation of Moore’s Law?
I had indeed mentioned that the chips will keep getting shorter and that the transistors on it would up exponentially, but I didn’t put a number to it. I remember in 1958, I was speaking at an event and was talking about dimensional scaling, making things smaller and smaller. I had done intensive research and gave a talk on it on a professional society and it turns out that Gordon Moore was there in the audience. And the Moore’s Law came later on. I believe that electronic components would indeed be smaller and smaller due to the hunger for new inventive things that we have.

Do you believe that the digital divide between the haves and have-nots be ever bridged?
Oh! I think it is inevitable with technology getting cheaper and cheaper for instance the $100 laptop that came out recently. I believe every one in Indian university could use the laptop and then it could percolate to the schools. I feel it is inevitable that computer will replace the book, so as to say.

In a biographical sketch, your daughter had stated “people are looking at his past accomplishments while he himself continues to point to the future”. What do you say to that?
That’s right there is so little dialog going on currently and that’s what I really yearn for.

What really motivates you at this age?
I hope that something can get going in the world and I want to stay alive and alert for that. I almost gave up publishing rather stupidly, you know I had indeed published fair amount but I didn’t seem to be able to make much difference..

Is there some sort of sadness that you have?
I guess sadness may be appropriate. But then, I tend to say “Well it is your fault Doug, you don’t know the rest of the world well enough to be able to be able to communicate and make them see what you do”. So, at the end of the day that seems to be a pattern how I look at things.

Do you not think that the invention of the mouse overshadows everything else done by you?
Oh sure, it does overshadow, but it makes me very happy. Imagine a significant portion of the world’s population using my invention. It is hard for me to get used to it.

Shashwat DC

“WHO is this Berners-Lee, that you are so excited about?” my father queried. He had been quite surprised to have me talk incessantly about Sir Tim Berners-Lee and his achievements all time (especially, as the date of my interaction with him came nearer and nearer). I explained to Pa the wonders of the Web, the magic of the Internet, and how the ‘father of the Web’ was responsible for it in so many ways. Somehow, I couldn’t impress my Pa much, so, I told him a small fact a wee bit exaggerated, that had Sir Tim patented the WWW invention, he could have been many more times richer than Bill Gates. Bringing Gates into the topic was what one calls; coup de grace, as suddenly Pa too developed respect for Sir Tim, after all who wouldn’t want to be as rich, if not many times more richer, than Gates.

Yet, so often, Sir Tim has debunked the thought. He argues that had he patented his invention, it wouldn’t have spread the way it has. Still, his supposedly altruistic action has added sheen to his persona and earned him respect and adulation from all quarters. For me, personally, speaking to him was a high point of my professional life. For years, I have read and heard about Sir Tim, and when I finally got to talk to him, it was just amazing.

In an hour or so, we discussed the evolution of the web and also the future of it. Sir Tim also seemed very inquisitive about the way India was adopting the Web and asked me time and again on how things were on the ground. For instance, he is very keen that there is more content in local languages on the Web, as it represents the diversity of the Web. “Diversity is important for the planet. We need to have diversity of cultures, of languages, of points of views, of ways of looking at problems and solving them. Without that the human race will not have its incredible richness,” he says.

This interview was published in the Dataquest magazine in an abridged form, after all, it is hard to print ten pages of content. Yet, everything that Sir Tim said in his soft and learned voice is of immense value, as he has become the ombudsman of the Web, a caretaker, a guardian. Hence, I publish here, the complete transcript of the interaction we had. I do hope, sometime in the near future, I get to interact with him again, there is just so much to ask to him.

Even my Pa has a query for him now, “Why did you not become (as rich) like Bill Gates?” Forgive my old man and thank heavens that Sir Tim is not.

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‘I think the opening up of the free flow of information (on the Internet) is inevitable’

“Quite an ordinary person,” is a term that Sir Tim Berners-Lee uses for self. Nonetheless, the world that refers him as the “father of the Web” chooses to disagree. It was in the early nineties, while working at CERN; Sir Tim proposed a project based on the concept of hypertext, to facilitate sharing and updating information among researchers. The project is now known as the World Wide Web (WWW), or simply as the Web. Sir Tim did not patent his invention and made it available freely so that it could be adopted and spreads rapidly. It has indeed, according to Internet World Stats there are an estimated 1.2 billion Internet users spread across the different continents. And the usage is growing at an astounding 244.7%, especially in Asia and countries like India and China.

Currently, Sir Tim is the director of the World Wide Web Consortium or W3C, an international standards organization that oversees the evolution of the web. The ‘father of the Web’ has now taken on the role of caretaker and is often talking about different issues that hinder or are beneficial, for instance semantic Web, net neutrality or introduction of domains like .mobi or .xxx. He is also very excited about the prospects of mobile web and hopes that countries like India that have a huge population of mobile users could benefit from it. Sitting at the W3C HQ at MIT, Massachusetts, Sir Tim is very interested on how the Web is playing out in India and is there an explosion of Indian local languages on the Web.

In an extensive interaction with Dataquest, Sir Tim talks talks about different issues be it India’s limited role on a global scale or how could what he thinks of Web 3.0. Excerpts.

Let’s start the discussion with India; with 3.6% of Web users — some 40 million – India is the 4th largest in terms of sheer numbers. Yet, the nation and its people have so little say on how the Web is run, moderated or evolves. What do you make of that?
When you say that India has little to say how the Web is run, moderated or evolves, there are numerous aspects to it. First thing is content. On that front, Web is a very open space where anybody can publish what they want. Basically, it all comes down to having enterprise and creativity of individuals to put up a Website or a blog and of course there is an increasing number of Indian Websites with local and global content. One of the most important feature about the Web is its diversity, not just about languages and culture but also in terms of social things, the fact that you don’t have to put up really professional things, you could just put up amateur things, just about anything. The bar has been set pretty low, so as to say. So if people things that some subject or certain languages are under-represented on the Web, I would encourage them to fix that.

Second level is the standards. Traditionally hypermedia has been the crux of the Web, namely interlinked text documents with pictures, but now we are also seeing a lot of audio and video on the Web. Another interesting area is the publication of data on the Web, data about all kinds of people, about the way they are connected, about products, about weather, and so on. Things keep evolving over the Internet and standards are a process of this evolution.

Personally, I want to have participation in the standard setting process from every part of the globe and I would encourage people in India to involve in the process. There is a W3C office in India which we set up to for helpdesk, to help small local groups, it can be approached for guidance. Standard setting process is basically an international activity, so any W3C working group that has an inclination or an idea can be involved. So one possibility in which people in India can choose and direct the further evolution of the Web is by getting involved in the standard setting process.

Finally, there comes the infrastructure. There is little governance of the underlying infrastructure like domain names, etc. But that is relatively small part of the social governance. What really drives or rather regulates the Web is more of social laws of the land, laws regarding copyright and libel and contracts and these differ from nation to nation. India has always been a part of the Web, I expect it to play a bigger role in the coming years.

How do you feel about the fact that millions of millions of people in Sub-Saharan Africa, Latin America or even in rural parts of India and China are completely oblivious and touched by the wonders of the Web or the Internet?
I have often pondered upon this, and feel that a lot many things are inter-linked here. First and foremost, Web is not the be all and end all of everything and I do not think that it should be forced on anybody. Many countries in Africa or Latin America already have a long list of things including clean water, healthcare, peace, etc. that are a priority. And history tells us, that many of these social development things have been achieved in the past without the Internet.

So we have to make sure that, while we are very excited (have heard very positive stories about Internet connectivity helping the population in developing countries), it is important, that we do not get distracted by it. The rush for fiber optics should not come at the cost of clean water and healthcare.

Yet, I do feel it is the duty of the developed countries to help the developing countries in as many ways. There is an ethical duty that any developed nation must help a developing country.

There is also this view that the Web is basically a tool for the educated and the elite, what is your take?
Well, to be honest, if one looks randomly, there indeed seems to be a bias on the Web. The bias comes from two ends, one is the language, there is disproportionate amount of content in English and secondly, the type of content, a large amount of this content is rather technical in nature. So you can easily find content on technical topics using the search engines. For instance, if a same term is used to describe something technical, or musical or historical, you would be more likely to find the technical paper. That is simply, because technical people are more apt to use the Internet and thus more apt to put things on the Web. Hence, there has been a skew that has existed from the beginning. The good part is, it is becoming less and less strong.

There are basically two things that inhibit a person in rural India in regards to using the Web. First, there is the physical level, namely the computer or an Internet connection. In that respect, Net is a tool that requires certain amount of technology available before it can be used. That would change as more and more people in rural areas get access to technology, as the prices of the terminals and computers come down or even with the introduction of smart phones with Web browsers. That is bound to change, so that we will have more and more people with access to the Web.

I have great hope on the mobile device and feel that mobile devices will bring the Web to very many more people. We at the W3C consortium have a Mobile Web initiative, which is designed to promote the use of Web on the mobile devices and also impress upon Website designers to keep in mind the small screen size of the mobile phone when they design a Website. Some are easy on the phone screens and some are not, so we are promoting the best practices in Web designing. This will not only help the person or the corporation to reach the executive on the handheld but also the person browsing the Web in rural India using a mobile device.

Now, let me come to the language barrier, namely accessibility in the given language, I feel strongly on the issue. The standards that we promote at the consortium have a very strong internationalization angle to them. We have an internationalize team which ensures that standards don’t have a bias to one particular culture. So most of the standards use XML, and XML uses Unicode. So we try to make Web work with different systems of writing and different characters used in languages. When the technology is completely internationalized and localized, still there will exist a big gulf in terms of provision of content in ones local language. That is something that really Indians have to do, i.e., creation and translation of content into Indian languages.

What I suspect that Web in local languages will explode in a similar sort of a way as in English. It may be that English becomes the common language for things that can only be in one language and then would come the local or the regional language. In the near future, possibly Chinese will become very common on the net due to the large number of people who speak that language. I feel people will end up learning two languages, one is an international language like English and the local language.

Personally, I hope that we don’t lose the diversity of the Web, diversity is important for the Web. In fact, diversity is important for the planet. We need to have diversity of cultures, of languages, of points of views, of ways of looking at problems and solving them. Without that the human race will not have its incredible richness.

You have often spoken very strongly about the universitality of the Web. But is it really universal in a manner of speaking, with numerous governments monitoring and block the flow of information like in China, Saudi Arabia and even to some extent in India?
That is an interesting thought. I grew up in the west, and I believe that openness and government are very important. I believe there are very small number of dangerous things that should be really banned. Certain things are just illegal, like, child pornography, communal incitement, criminal activity, etc.

But I also think that free speech is very important. I do also feel that anonymous free speech can sometimes be dangerous because it can be used to spread lies. I think the ability to blog and be frank is a great tool and medium but bloggers should bear certain responsibilities. I feel bloggers sometimes do not realize that they have major force, if they mean or misrepresent things and it can have a very negative effect. In the days to come general openness will increase inexorably because people understand what they are missing and will demand it.

However, I realize also that countries that are used to having very strong control on information flow, it is impossible to change instantly. So I think these changes will happen over time, at times there might be a few setbacks, but I think the opening up of the free flow of information is inevitable.

What do you think of the enterprises colluding with repressive regimes for commercial gains, like Yahoo that helped in the prosecution of a blogger or Google filtering the search results in China?
I am really not in the position to comment on individual cases as I do not know them well enough. It is very tricky decision. I know that the companies have stated that they were forced into areas of compromise. I think compromises can sometimes be very essential for progress and can at times be very disastrous. I am in no position to really weigh whether these compromises were fair enough, or wise or not, history will be the best judge.

You have been talking extensively about Semantic Web or Data Web. When do you think it will be a reality?
It is evolving at the moment. The data Web is in small stages, but it is a reality, for instance there is a Web of data about all kinds of things, like there is a Web of data about proteins, it is in very early stages. When it comes to publicly accessible data, there is an explosion of data Web in the life sciences community. When you look about data for proteins and genes, and cell biology and biological pathways, lots of companies are very excited. We have a healthcare and life sciences interest group at the Consortium, which is coordinating lot of interest out there.

Meanwhile, there are various data projects to create link data that is data with which you can browse unlike browsing that we do normally on the Web. With Link data, you can do things like produce tables and map and put them in spreadsheet. The possibilities are endless. So the data Web is in fact starting to catch up, people are understanding how to use it as a data integration system. Under this new term link data, it has only been around for year or so, there is growing rate of data that is actually on the Web that allows you to start exploring one piece of data and pulling other related data and process it together.

Do you think, developing countries that have relatively less Internet penetration can leapfrog to Web 3.0 or Semantic Web?
I believe that is always the case. A country that is developing tends to leapfrog over its developed peers in terms of technology, so for example, I would expect developing countries when they put data on the Web (especially the government) to use RDF or Resource Description Framework. RDF integrates a variety of applications using XML. This is a truly great way to disseminate data. For example if the Indian government has say census data, or rainfall data or even train timings. If they put the data on the Web using the semantic data standards, then anybody can write a Website which can use that train timings data and display them in their own language, as data is global and does not have a language. And that is one of the exciting things about semantic Web, when you put the data out there you are not putting the data in English or in Hindi, you are putting it up just as data. Essentially data is numbers, and these numbers can be displayed in different languages. So the train names, station names, etc can be converted into multiple languages without human intervention.

In the west, for example in England and in America, that governments are putting up data and other Websites are picking up data from these government Websites, reusing it and making their own Websites. So Mysociety.org or Govtrack.org is a Website that tracks the US government by taking the data from US government Websites. So anybody can use this data and generate Websites automatically in different localized languages. In these ways and more, I think the semantic Web is more accessible and more international, you could produce a Braille version, you could produce a speaking version, based on the same data. I am very excited about the prospects and possibilities presented by semantic Web.

Wanted your take on the different jargons that one comes across, Web 2.0, Web 3.0, I even came across something like Web 2.5?
(Laughs) These numbers just keep floating around. The term Web 2.0 was invented by Tim O Reilly, it started by being a name for a conference on evolving technology and the term caught on and people started using it generally to describe what seems to be happening now and what we think would be happening in the future. I tend to talk more about sets of standards, about specifics. What I really think in the future, the mobile Web will be a big thing in the next ten years or so. The difference being that Web on mobile devices is going to be much bigger.

In fact mobile devices accessing the Web will be much larger than fixed devices. In the future, data will be accessible in lots of different ways. Today, the term Web 2.0 is used for Websites where the users generate the content. So I think, when people use the term Web 2.0 it is more about user generated content. But these different Websites do not interconnect, in the future, I would not call it Web 3.0, users would want their data to be interconnected. If they upload the photographs to different Websites, then they want to be able to see the photographs using the same tools.

For that they will need semantic Web that interconnects all. It would be like, I have given you my data, now give it back to me, because I need to be able to reuse it. Now I need to make a scrapbook, now I need to look at whole year the photos I have uploaded to different communities. I want to look at all my content, some of my friends are in Orkut some are in life journal. Now what I want as a user if I have my friend circle in Life Journal for example, then I use other tools to explore who I know including people in Life Journal and other online communities. We will see the interconnecting of data from different sites and that is an important part of Semantic Web.

You have also been a staunch supporter of Net Neutrality. How do you perceive the threat and what needs to be done to safeguard it?
The threat is mainly an American phenomenon, I think Net Neutrality is treasured so much by the user community that I don’t think there is a serious chance that we will loose it. But that does not mean that the threat isn’t there. Lot of countries and even companies would like to be able to control the Internet, because it is always very valuable to control the flow of information.
And as we have seen, some governments can’t stand on their merits, they feel they have to limit the flow of information. Meanwhile, if companies can control what you see, they can control what you buy, and where you buy from. They could also control what political things you se as well. The fact that the platform is neutral is very important, the threat at the moment in the US.

Currently, my Internet connectivity is actually provided through my TV cable, you the company that use to sell me television feed now sells me Internet over the same cable. Suppose I go to a site like Google Video or Youtube, or I download a movie using iTunes. But suddenly I find that the Internet signals have been blocked and when I call my cable company and they say that “Sorry but we can’t let you watch videos from Websites, because we reckon that if you want to watch a movie it would be better if you chose it from our library and watch in on your TV. Since you have signed up for Internet access from us, you must buy up movies from our Website.” These companies could try and dictate what we see and how we see it.

Can you share an instance of such an event?
In fact if you look at the movie industry, and of course India has its own internationally famous movie industry, at the moment it is very complicated to be able to access movies. Of course there are different channels, there are cinema halls, DVDs, etc. but it is still very complicated. If for instance you are an Indian in London and want to access a whole selection of Bollywood movies, you possibly can’t because your local store might not have it. Movies over the Internet may actually open up the whole film industry to a much wider and diverse group of people making films. It may allow a lot of films to be made available in different languages and independently of place. So you could watch a film in your mother tongue from any part of the world. And of course there will be other things like more choice due to documentaries, and other independent films which don’t have a big following but some people are passionate about.

In most industries and as on the Web, you see what’s called the long tail, a few very heavily used sites and a large number of very likely used sites. This is the typical way of distribution. The long tail is necessary, as you homogeneity from a host of popular Websites, but also the diversity that is available from the long tail of diverse Websites. And this balance does not exist in the movie industry at the moment, so there maybe a bit of a shakeup and there maybe a huge reinvigoration for the movie industry when it happens.

Obviously the companies that deliver movies at the moment in the traditional way will have to learn to change. That’s does not mean that they will go away, they would learn to adapt as book stores learnt to adapt to the Internet and they didn’t go away neither do the books. So that is one example of a change that could be threatened by ISPs, if the providers are given control of what you see. But my worries are of macro kind, for instance if certain political party pays an ISP for not giving access to a rivals Website, etc. There are all kind of ways which you can imagine. If you do not have rules, there are all kinds of way in which net neutrality can be damaged.

Does the shift from current Web technologies to future correspond your idea of “from interactive to intercreative”?
I think that’s an interesting shift at the moment. I coined that word intercreative a long time ago. In order to get people to work in the direction of building things together and solving problems together. So it is about group being more smarter than the individual. The original Web browser which I wrote, was also one in which you could edit, make links and save the links very easily. My original vision was that everybody would be an editor, everybody would be a part of space where they can write. You could make links from one page to another by pressing the correct control links.

The fact that blogs and wikis have taken off, confirms by belief that people really need to be creative rather than reap up other people’s things. I think both blogs and wikis demonstrate how you can have a very positive creativity emanating from a lot of people. I think blog is one particular genre, it allows one person to publish and sometimes other people to comment and it works by people making links with each other. As these blogs link to each other, if people are interested in a particular topic, they can find out what other people are thinking by using these links.

The blog is very particularly interestingly constrained form of this genre. Then the wikis is another genre where whole lot of people will get together and everybody would try and hone a project, like an encyclopedia, or common information about what they should do on a vacation. And we would see very many different genres appearing in the future.

One of the things we haven’t seen on the Web really is workflow, where you can very easily set up systems, where for instance we are working on a broad set of activities, I am working on one set and you are working on other, we can setup Web systems that can make that very easy. We have easy tools that help us in collaboration. We do have things like issue tracker on the Web, which is very useful in terms of projects help keep tracks of different.

A very important area of intercreativity is how we make communal decisions, I suppose it is self government. That involves the lost art of argumentation, how do we make arguments. So I would love to see, tools on the Web which support reasonable argument, allow people to put up a thought in the spirit that it is there to be challenged and allow people to build pieces, allow challenges to quote sources. I can imagine a Website where you would have people debating and quoting facts and statistics that can be tracked by anybody through the links.

I am living in America at the moment, we ourselves use the Web extensively in our work. The working groups makes standards and have people or groups contributing in from all over the world. Web is used to build a consensus. To that end, the art of building consensus and using Web as a tool to that I hope to see much more powerfully done in the future

You have spoken against the addition of new tier of domain names like .mobi, .xxx, etc. Why is that?
We have spoken about the mobile Web and how different people would be accessing the Web at different times and on different devices, a very great diversity. You have a screen with 3 million pixels one moment and would have a 3 inch screen the next moment.

But is important that if I refer to something like train timetable for example and if I bookmark it using my phone, I can view it on my computer screen. Hence, it very important that the same URI works on different devices. The problem with .mobi, I didn’t want to have a domain that limited accessibility from certain devices, small devices in this regard. Then this would mean that, there would be a different URI for the computer and mobile devices. I fail to understand the need for it. The important thing is that the same URI should work, I don’t want to keep track of two URI for same thing, and I do not want to keep two bookmarks of same thing, depending on whether I am using my computer or my mobile device. It is very pragmatical engineering reason.

The engineering of the Web depends on you have a general one URI for something and wherever you use it, it works, irrespective of the software or the hardware you are using. That is part of the universitality of the Web. I think the consortium behind .mobi have the best intention because they are trying to — and we are working closely with them — see a lot of content available from mobile devices. But architecturally I feel that .mobi is a gimmick, the same URI should work very well on different devices.

But again from a developing country’s perspective, not many domain names are available, as people have already booked the .com domain. Do you not think it is an uneven proposition?
That’s a sad reality. You will not find short ones available, but you will certainly find the longer ones. Also, there are the local domain names. I know for instance a lot of people in the UK do not use .com very much but rather .co.uk and then there is a whole Indian domain (.in) which is available to for India to manage.

And I would recommend, like in UK, .org is only used by non-profit. I think that .co.in is a very respectable domain name like .co.uk is a very respectable domain name in the UK. That gives you an access to a lot of words. I also think that people are going in for quite long words, long names for domain names and as public gets more and more used to it, you would see the number increase hugely and people making up new names or words.

What do you make of the tussle between ICANN and other nations over the ownership of domain names?
The roots of the domain named should not be owned, it is a public domain resource and it should be managed very carefully for the people of the world. There is a lot of management that has to be done for the domain names and it has to be done carefully. As you know I am not in favor of creating just top level domain left, right and center. I think the Internet can happily survive for the next ten years without the need of a new top level domain. I think most of the time people are doing this not because they think it will help the society but because they can own a whole lot of Internet real estate. For instance I don’t think that the .info domain has really helped as very much, people still feel they should get a .com and it only adds to the confusion if different companies have the .com, .biz and so on. And there isn’t very clear definition what each domain is for.

I think that the top level domains, it is very important, are run fairly internationally with a fair representation of businesses and consumers worldwide, not just the companies that run the Internet. I think that whenever you have something that represents the whole world, like the United Nations, it becomes bureaucratic and it becomes slow, because it takes a long time to take into account everybody’s point of view. So we should be prepared to put up with some bureaucracy.

We don’t need a domain name system in which you could very very quickly get a new domain name. Domain names are not the most critical part for the functioning of the Web. The Web depends on the development of standards, I think we should put our energy into creating new standards, bringing new technologies, like open standards for video, encoding, open standards for data communication, putting scientific and clinical data out there on the Web, to spread that sort of information between countries. I think that sort of thing is very important, that’s where our energy should be spent.

You have also warned about the dark side of the Internet or the Dark Net. It seems quite morbid, what is the threat level here?
I never spoke about the Dark Net, the article that BBC put up was just a case of very bad reporting. At times reporters seem to be more interested in bad things. What happened was that I had a long discussion with various reporters, and I think there was somebody from the Guardian asked if there was anything that I was worried for and I said yes, there are lot of things that one could worry about. And this was blown out of proportion and the report said that the inventor of the Web is very worried about the dark side of the Web. Whereas most of the conversation we had, like the one we are having now, was about very strong hopes for the future and tremendous excitement about very positive things.

For instance, when you asked specifically what concerns I have and I spoke about Net Neutrality, but then I am very optimistic about humanity and am sure we will have neutrality because a vast majority of users of the Web understand how important it is. And they would fight for it, as you said they have fought in India.

Which aspect of the current Web impresses you the most, say, like Wikipedia, Orkut or even Second Life?
I think that all of that is very interesting. I never had any favorite, I think Second Life kind of thing or virtual reality is very interesting because as the screens will get bigger and processors will get much more faster and smarter, these Websites would become even more compelling, Thus I think there could be lots of positive things that emerge out Websites like Second Life but in that area I think standardization and openness would be very important. So all the things that you mentioned like social networking, are generally very positive, there could many more things to come, it is just not over.

Shashwat DC

IF some sociologist were to study the last few years of changing patterns of Indian society, surely he or she would be impressed and mystified by the impact of BPO on Indian youth. Not many moons back, Call Centers were a strict no! no! The late nights were looked down by suspicious neighbours, parents would embarrassingly stutter when asked what their children were doing and friends who were working in day-jobs, would chide their lesser BPO pals. Employees in call centers lived in a virtual bubble, a universe of their own, working in the nights and sleeping through the days. Little wonder, so many marriages were made and unmade in these very call centers.But one critical thing was though different: the money was always better.

As the country underwent change thanks to Manmohan Uncle and his market liberalization policies, so did the society. The content-family structure was replaced by ambitious-nuclear families. Suddenly, things like DINKs (Double Income No Kids) and the Metro-sexual Man, and other tags became fashionable. In this scenario, the high-paid BPO population were no longer social outcasts but rather a model of changing India. Those halter tops and low waist jeans, the date allowance and the valentine parties, the pick-up and drops and the Sodex-ho coupons, were all so much alluring. BPO employees were buying flats in beautiful colonies, buying latest cars and taking an annual vacation to an European location. In a few years time, Call center was ‘THE’ place to work in.

Yet, the great BPO dream is steadily dissipating. As the cost arbitrage enjoyed by the BPO companies withers away due to rising Rupee, the salaries are not growing the way other sectors are. My wife, who works in a reputed IT company, tells me that scores and scores of BPO people are eager and keen to make a shift to normal day jobs, even if it means a nominal pay cut. One of the main factor, beside job satisfaction, is the health factor. BPO employees are not keeping well. The sad part is, not many seem to be listening.

Every year Dataquest in conjunction with IDC India, conducts a comprehensive Employee Satisfaction Survey for BPO industry. The idea is simple to gauge the satisfaction levels from the perspective of the BPO employees. This year, I chiefly just analyzed the data from one perspective health. And was shocked to see that over the years, complains have been rising and yet no one seems to be listening. The story I present below, is quite different from the one published in Dataquest and my editors do not necessarily agree with my interpretation. But, yet,I am presenting the story, merely to highlight the issue and hope someone, somewhere thinks about it. Thinking is the first step of doing. The original Dataquest story can be accessed from the following link (http://dqindia.ciol.com/content/top_stories/2007/107111617.asp)
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BPO E-Sat Survey 2007: Of Sleepless nights and salary hikes

All is not well on the BPO front. Indian BPO employees are suffering from a variety of health related issues, right from sleep related disorders to anxiety attacks. This year’s Employee Satisfaction Survey maps a disturbing trend, the ailing BPO employee. While the attrition has gone up to 20% and the average wage hike as come down to 14.8%, it is the health issues that seem to be the biggest concern.

In a quaint corner of Goregaon suburb, Mumbai, exists Dr. Ramkumar Moorthy’s clinic. Moorthy is a general physician and has been seeing patients in the clinic for over two decades or so. Known to be quite adept, his clinic is often brimming with patients, from kids to septuagenarians. But over the past year or two, there has been a detectable change in profile of patients pay a visit to the clinic. Any given evening, his waiting room is brimming with groggy-eyed irritated teenagers waiting for their turn. These twenty-somethings can be overheard on the phone, asking for an extra day off from their TLs or assuring them that they would reach the office, in time for the log in.

Not prone to worrying, Moorthy is still a wee-bit taken aback by the sheer number of youngsters that are reporting sick. “The number of young patients has indeed gone up by quite many notches over the past few years. I am saddened to see a 26 year old suffering from high blood pressure, or 28 year old from heart ailment,” he says grimly. In all probability Moorthy might be getting more cases due to proximity of his clinic to the BPO nerve center of Mumbai; Malad.

But then, he is not the only one, visit any doctor in your locality and after the stethoscope has touched upon different points on your torso he or she will invariably start talking about how unhealthy today’s youngsters are. Not with disdain but with a touch of pity and many docs blame the BPO companies or what they refer as call-centers for the sudden spike in these numbers. “What else can be the reason?” asks one doctor indolently.

Surely not in the pink
One need not be Einstein to figure out the link between call centers and increasing ill-health among the young work force. Working continuous night-shifts, and often at unearthly hours like 3 am, is bound to take a toll on the body. The body cycle is completely thrown out of gear, and BPO employees often complain of sleep-related disorders or digestion-related problems.

It sheer travesty that not much attention has been given to the health related impact of BPO industry on Indian youth. There hasn’t been any major study conducted on the issue and even Nasscom, that has a BPO forum, also seems to have ignored the issue. Yet, Dataquest and IDC have been tracking health related information of Indian BPO industry through the annual BPO Employee Satisfaction (E-SAT) Survey. Every year, employees are asked to list down factors that cause stress and also the ailments that they are stricken by. Year after year, the list is collated and released as part of the survey.

Most of the times, health takes a backseat to issues like increasing attrition, wage issues, or dipping or upping employee satisfaction levels. But this year, we have decided to play it a tad differently. On going through the data available for the last few years, it is obvious that health related issues are on the rise. As DQ has always stuck out its neck and drawn attention to issues that might turn into whole scale problems, so would we do it this time round.

Going by E-SAT 2007, one thing is apparent; Indian BPO workers are not in the pink of health and if attention is not paid soon enough they would be in the red of it, figuratively speaking. The biggest bane of BPO employees is ever increasing stress, which is the root for numerous other physiological and psychological ailments. Reasons are aplenty, right from working hours to insufficient holidays. The top 5 reasons thrown up by the survey for high stress remain more or less the same as that of last year, namely; travel time, work timing, insufficient holidays, work load and long working hours.

As most of the BPO companies are pinching corners in terms of cost saving, one of the first perk — home pick-up and drop – has been withdrawn or curtailed. Every major BPO company today at max offers either pick-up or drop, seldom both. Result, half-awake individuals rushing home in the day or half-asleep beings making a dash for office late in the evenings. Except for New Delhi (as there is not much of public transport to talk of), in most of the cities, BPO companies often loath to provide even home pickups or drops, even when it is only one that they do. They prefer to drop or pickup employees from central or vantage points, thereby saving on costs.

While such measures might shore up the company’s bottom line, they are certainly not helping the employees. Over 32% of the respondents listed travel time as a major reason for increased stress. Things have come to such a pass, that the few companies that still provide pick-ups and drops are much in demand and HR managers do not forget to mention the benefit at the time of interview. For instance, JP Morgan Chase prominently displays the fact that its employees are provided air-conditioned cars to ferry them to office or drop them back. According to a few HR managers, prospective employees are known to have settled for lesser sums for companies that provide drop and pickup. Little wonder, it can be used a good tool for curbing attrition.

Sleepless in India
Returning after a 9-hour shift in the noon, Shweta Puthran is seldom able to sleep, even though she desperately wants to. It has been a few years since she has been suffering from insomnia, and has even tried sleeping pills. The condition has marginally improved; more so because her biological clock has now got more or less acclimatized to the change, sleeping in the day and slogging in the night. Yet, there are days when Puthran would keep staring the musty roof, waiting for slumber to set in.

Going by the data available through the E-Sat Survey; sleeping disorder, digestive system related disorder, eye sight problem, severe stomach related problem, depression, are the top 5 ailments afflicting the BPO employees. Insomnia is the most common of the ailments for the industry and it mostly affects the agent or CRE level employees. As manager and senior TLs tend to have flexi timings or at the least take the weekends off. BPO companies that have a high focus on European operations, mostly UK, tend to be more in demand then US-focused BPO companies (since, difference between UK and India is a more manageable 5 ½ hours rather than 12-14 hours, as with the US).

Digestive ailments figure prominently on the list after sleeping related ones. Not surprisingly, as most of the employees are eating at odd hours and more importantly eating odd stuff, from medu vadas at 4 a.m. to American chopsuey at 7 p.m. Junk food has more or less replaced proper meals for BPO employees. According to one physician, BPO employees are increasingly becoming obese and it would result in many more health hazards like Diabetes (type 2), high blood pressure and even heart related ailments.

The other worrying ailments that have increased over the years are psychological ones like depression and anxiety. Indeed, BPO employees are well versed with panic or anxiety attacks, and often a friend or a colleague who has been a victim of the same. The survey has also for the first time collected data on back pain and this year close to 2.34% complained about persistent and niggling back issues. Most of the BPO companies have a doctor on-board but he or she is usually in a reactive mode, i.e. if you have an ailment while at work, you could consult him or her.

A few companies seem to have woken to the issues. Take the case of e4e for instance, it keenly promotes flexi timing as a means of lessening stress. It even has made it mandatory for the managers to ensure that their juniors are taking at least a week off annually. While a lot many have tied up with local gymnasiums and health centers, offering heavy discounts to employees. But it is too little or too less.

Many would argue that health and stress related statistics has more or less remained constant over the past few years, hence there isn’t much to worry about. But a spike is not necessarily an indicator of a problem, constancy is a big issue as well. For instance, when you are running a high temperature, the big problem is if it does not come down, not whether it keeps going up.
The industry that employs over half a million individuals and accounts for over $8.4 billion annually, needs to relook at things and take corrective measures before things get out of hand. Hopefully, after the publication of this report, associations like Nasscom would look into the issue and hopefully conduct a comprehensive health related study on the BPO employees in India. Till we really know and understand the problems faced by employees, there is little than can be done to help them.

Big versus small
The Indian BPO industry had been growing at a steady rate, even though under a lot of pressure. According to Nasscom estimates the Indian ITES–BPO exports grew from $6.3 billion in FY 2005-06 to $8.4 billion in FY 2006-07 and expected to touch $10.5-11bn in FY08. Employing over 553,000 people, the industry is facing a lot of pressure in terms of competition from other low-cost destinations and Indian economic factors. The biggest bane for exporting BPO firms has been the rising Rupee. As a result, this year the margins have been badly hurt.

Fortunately, Indian BPO companies have so far been able to more or less nullify the ill effects, and continue to grow at a steady rate. There have been two things that BPO companies are doing assiduously over the years, first moving into niche and specialized domain that pays more and secondly they are becoming more productive in terms of seat utilization and a smaller bench. Many BPO companies are looking at KPO seriously, thus even when they continue to depend on plain vanilla customer interaction services to provide the bulk of their revenues, they are also looking at niche business services, like financial accounting, HR administration, logistics hand ling, etc. to shore up their revenues.

Returning to the BPO E-Sat 2007. The ratio of bigger BPO companies vis-à-vis smaller ones, more or less remains the same. There are 6 big BPO companies (with over 5000 employees) featured in this years list. It more or less corresponds to last year’s figure.
It is the mid-sized (greater than 1000 and lesser than 5000 employees) companies that take up the maximum ranks. Close to 50% places, as many as 10 mid-sized companies are featured on this year’s survey.

There are lesser small BPO companies this time round. Last year, there were 5 BPO companies (with less than a 1000 employees), this year the number falls down to 3 (though, one of last year’s small company has moved up to being a mid-sized outfit). Out of the three, Equinox Global and Knoah Solutions are making a debut on the list, while Motif India continues to retain its rank at 17.

Of the top 5 BPO companies on the list, 3 of them happen to be big BPO companies, namely IBM Daksh, Genpact and Wipro. The two smaller companies at the top vCustomer and e4e exist solely due to the employee satisfaction score (both have been ranked as number one and two on E-Sat score rank). And that is where the difference lies. The big companies score well on the HR ranks, while the smaller ones score well on the employee satisfaction. But employee satisfaction can be transitionary, it can be won easily and lost easily as well. Thus, smaller companies need to focus more strongly on the process and put them in place.

Movers and shakers
Every year, there are shifts that happen on the list, companies climbing up a few notches and then there are those that fall a few. It always makes an interesting read, as it is more or less gives an idea of the best practices that are working in the marketplace. The biggest fall this year has been that of 24/7 falling to 16th from last year’s 10, a fall of 6 places. The reason behind is not hard to gauge, as the company’s HR score have fallen quite drastically due to decrease in absolute employee strength, average salary hike, average tenure of senior professionals, etc. Even its employee satisfaction has fallen, the areas in which the 24/7 employees were found to be most dissatisfied are; overall satisfaction and company culture.

The other big fall has been that of TCS BPO, falling by 4 places to 13th rank this year. Ironically, while the company’s HR rank has gone up by five places due to huge improvement in the employee size, average salary hike and CTC as compared to the last year. The result, HR rank has increased from 10th to 5th. But the employee dissatisfaction seems to be increasing. The drop on E-Sat Score has been more dramatic than the gains on the HR rank, falling 8 places and standing at 15th this year versus 7th last year. The major area for employee dissatisfaction has been salary and perks.

In terms of gainers, except for the big IBM Daksh debut at the third rank, the biggest gainers are Brigade and EXL Service, both by 2 ranks. Brigade has shown marked improvement in its HR rank basically due to improvement in employee size and average training days in absolute terms. The score in average salary hike has also increased as compared to that of previous year by reasonable amount which has resulted in rise in its rank from 19th to 15th in HR part.

Meanwhile, EXL has shown improvement in employee size, average training days in absolute terms which has resulted in rise in its rank from 7th to 6th in HR part. Whereas it’s E-Sat rank has fallen by a single rank to stand at 14th place this year.

Of the companies that participated last year, 7 were missing this year, namely, Office Tiger Database, ICICI First Source, Sutherland Global Services, SlashSupport, AXA Business Solutions, Keane Worldzen, Integreon. Sadly, these companies did not take part in this year’s survey. Similarly a lot many ‘big’ companies were also missing, like Infosys BPO, WNS, Intelenet, and others. Hopefully, next year these companies would not shy away from sharing data about their employee satisfaction, which is the best indicator of how good or how bad they are doing.

Attrition Blues
Ask any BPO company’s CEO or HR manager, what is his or hers biggest challenge, and attrition is the word that will escape their mouths. The industry’s biggest demon is rampant attrition, with scores of BPO companies looking for talent, BPO professionals are in hot demand and often these fresh out of colleges graduates hop from one job to another, till they can hop no more. With each jump, the package going up by as much as 20%.

But the companies have woken up to this tactic and are loathe to hire job-hopping monkeys. An HR manager working with a reputed BPO company says that nowadays the company lay a lot of significance on the “dependability” of the new recruit and pays much attention to the antecedents. The companies are trying to find potential job hoppers at the interview stage and then not hire them. “Prevention is often better than cure,” she says. Nevertheless, be it no-poaching agreements or not hiring high risk individuals, the average attrition rate has gone up by 2 percentage points, up from 18% last year to 20% this year.

The most common factor for employees leaving an organization or being dissatisfied is money and nothing else. Not much surprising as the BPO industry is in cost-saving mode, the increments are getting lesser and lesser. In fact according to the DQ-IDC Survey, the average salary hike across categories has decreased from 17.2% to 14.8%. It is quite a significant drop and is surely one of the main factors that promote dissatisfaction among the employee base. The second most common reason cited by exiting employees is growth opportunity, followed by higher opportunity and of course job timings. The survey findings reveal that transport facility, work pressure, and work timings are amongst the top reasons for employee dissatisfaction.

A lot of BPO companies are able to arrest attrition through a variety of HR strategies. It has also been noticed that salary is a big issue in everyday voice centric call centers, while in the KPOs the employees are known to put up with lesser amount as long as the work is challenging and interesting. HR managers also seem to support the view and hence are taking more interest in employee’s workload, trying to find cues that trigger an employee to call it quits. In the end, there is just as much as a company can do to control attrition as it is more of an industry wide issue rather than specific to a company or more. And as the BPO companies keep squeezing the salary increments, the attrition is bound to go up.

Innovative HR
As said earlier, it isn’t all about money, honey. Many companies on the E-Sat Survey are employing a variety of innovative HR strategies to hold on to their employees. Take the case of Hyderabad-based Brigade. The company has appointed a Chief Fun Officer that looks into ways and means to ensure that employee stress levels are low and they remain highly motivated. The secret behind Brigade’s joie de vivre is not that hard to miss. As the BPO companies are facing immense pressure due to the squeeze on the margins, retaining good employees is a priority like never before. Frequent hiring and retaining can be quite costly, so if you can hold out to your employees, anything is justified.

Or take the case of Bangalore-based e4e, most of the employees grievances are sorted out during the HR powwows, wherein the management and employees discuss problems face-to-face. The company also has a policy where it is mandatory for employees to take 7 days off in a year and it is the manager’s responsibility to see that his junior takes it.

In both the above instances, the companies were able to arrest attrition by proactively reaching out to employees, e4e has been ranked at number 1 and Brigade number 7 on the E-Sat Score Rank. Similarly a lot many companies are pursuing newer ways of employee retention. At the end, it boils down to innovative HR practices. Going by the data available, smaller and mid-sized BPO companies stand a better chance by being imaginative.

Whither woman?
One of the disturbing trends noticed in BPO E-Sat Survey has been the falling ratio of woman employee base. Based on analysis of figures of common companies who are participating since 2005 in a row, namely, e4e, Genpact, HCL, Ajuba, Motif, Cambridge, the ratio of man Vs woman has been increasing.

In 2005, the man: woman ratio stood at 1.80:1 (12136 males for 6708 females). The ratio increased marginally to 1.97:1 in 2006 (17822 males for 9044 females) and now there are over twice as many men for each woman, 22696 males for 10870 females.

Could it be that women are unable to cope up with the pressures of BPO, namely unearthly timings and high stress and opting out of this industry? There are many assumptions that one can make, but it is the health one that seems the most plausible. Hopefully as things improve, the ratio will improve in the coming year. It is a misnomer that BPO companies would be a dull place if women start shunning them.

Hard times to come
In the end, the overall satisfaction index has improved over last year, while the average salary increment has fallen proving beyond doubt that an Indian BPO employee expects a lot more than money. Indians are basically an emotional lot, and if BPO companies can touch a chord with their employees, they can often get away with lesser salary hikes.

With the companies facing the squeeze, it all boils down to imagination. Are Indian companies ready to experiment newer and innovative ways of employee retention. For the same we need a new breed of HR managers that do not hide behind management jargons but take the bull by the horns, or rather be ready for a ‘powwow’ with employees. Will they pick up the gauntlet, will be proved in next years E-Sat Survey.

Also let’s hope that next time round, as the BPO companies wake up to health related issues we would have a healthier employee force to contend with. BPO companies are in many ways the custodian of Indian youth, and if they turn a Nelson’s eye to their workforce, a whole generation might have to pay. Let’s cross our fingers that it won’t be so, and that while Moorthy’s practice in Mumbai continues to do well, the number of youngsters sitting in the waiting room would diminish. Amen!

Shashwat DC

The other day, I received a very unusual mail. It was a press release from Larry Sanger, editor in chief of Citizendium and co-founder of Wikipedia. The press release read, “One year and thriving”. It felt good, as I remembered an extensive interaction I had with him, when Citizendium was launched. And it has been a year already. How time flies doesn’t it? Sanger at that time, was certainly saddened by the way Wikipedia had “ill-treated” him, “More than anger, I am pained,” he had stated.

Later on, when I had asked Jimmy Wales for an interaction specifically on his take on Citizendium, he had written back; “I am happy to be interviewed by you, but I don’t consider either Larry or his little project to be of sufficient interest to be worthy of an interview. I know the media likes to make up stories about people being enemies or rivals, but the truth is, I just don’t find that sort of story very interesting at all”. I, personally, was saddened, for I have immense respect for Jimbo (as Wales is more popularly known) and I felt for Sanger as well. The rivalry between Sanger and Wales is certainly not a thing to be happy about, like we used to be happy about McNealy Vs. Gates, or Noorda Vs. Gates, etc. Someday in the future, hopefully the hatchet would be buried and bygones would be bygones again.

Meanwhile, Citizendium continues to grow, whereas Wikipedia has become the most renowned source of information on just about anything and everything. In this light, I thought, for the sake of nostalgia, I would put up the interview that I had done with Sanger and as it was published on CIOL and on Dataquest as well.

One of thesedays I intend to call up Sanger, and talk to him about the progress that he has made and how is Citizendium doing. Talking to Sanger was indeed great, especially since he so well versed with things and so keen a listener. He doesn’t argue or tries to bow you down to his point, but would rather mildly explain it and show you the merits and leave it there.
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“I believe experts and scholars have a lot to share with the world”

One would be hard pressed to find a person knowing anything about the web and not knowing Wikipedia or its founder Jimmy Wales. Wales is toasted across the globe, and hailed as an icon. Time Magazine even bestowed the sobriquet of a prophet on him. It is a story that hardly needs any mentioning. Yet, there is one small thing that blemishes the beauty of the such startling success, a certain controversy that refuses to die down, a certain name that refuses to be devoured by the demons of anonymity.

Sometime in 2000, Larry Sanger was dining with a friend and discussed the concept of wikis and how users could collaborate in a way like never before. Sanger discussed the same with his boss, Wales (then CEO of Bomis Networks) and thus Wikipedia was born. Sanger’s official designation was ‘chief organizer’, and was also working on another project similar in nature, Nupedia. A few years into the project, precisely in 2002, ideological differences cropped up between Wales and Sanger and both decided to part ways.

In the ensuing years, Wikipedia went on to become a big, big thing. And so the legend of Wales was born. But in all this pomp and festivity, Sanger was left out. In fact his role at Wikipedia is debated even today, Wales questions his claim as a “co-founder” and terming him as just another employee. Sanger seemed to take it all rather stoically, maybe because he is a PhD in philosophy and loves epistemology – the study of the nature and scope of knowledge.

When you started off with Wikipedia, did you imagine that it will be as successful?
To be honest, I did believe that it was going to be successful, but the scale, I did not imagine.

Do you have any specific strategies for countries like India? How has been the response so far?
The response has been very encouraging. We have received quite many applications from India. In fact, a quite a few of them are among the editors, the number is significant say equal to the numbers from Australia. We are banking on India and glad for the response so far.

Here is the second part of the Future Cities story published in Dataquest. The stories written by me and featured herein are based on personal experience and secondary research. Suffice to say, that the issue was a personal favorite. I would like to thank all the people that took time out for me and were so very generous with there time. They might or might not be the future cities, but they sure are warm (emotionally) cities of India. Again like last time, this is the original and unedited version and would be quite different from the one that got published.
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Allahabad: Holy modernity

It is a rather cruel irony that the point of reference for the Indian Standard Time or IST, actually lies very close to modern-day Allahabad. Thus every time an Indian checks his watch, he is actually checking what time is it in Allahabad. But for a city that gives us our time, time has more or less stood still. Indeed, Allahabad is completely devoid of any encumbrances of modernity.

A ride through the city on a three-tyred rickshaw driven my a thin skin and bones, would sufficiently convince you to either want to escape to back to modern times or probably enjoy the time and tide of the bygone era. It is quite a numbing experience.

Yet, wait a minute. When I refer to modernity, I do not mean the brands or technology – indeed, the latest and the best would surely be available in Allahabad. I hint at the comfort level of usage of computers in every day life. Even today for an average Illahabadi (resident of Allahabad), computer is a mysterious tool that has great promises but complex functions. It still scares him.

The reason is not hard to gauge, the biggest state in India, Uttar Pradesh, has also been the slowest in terms of IT adoption. There have been a few e-government projects, but they have been quite few and very far between. As, the private sector is more or less non-existent in UP, this has ensured that the computer has not really seeped into the very last nukkad. It is indeed a fact that UP has more or less miss the IT bus.

But there has been a ripple in Allahabad that just might turn into a wave and is worth mentioning. There are lots of prestigious universities and colleges in and around Allahabad, Banaras Hindu University is one and so is the Indian Institute of IT or IIIT Allahabad. It is these institutions that are driving IT adoption and purchase. Thus a majority of equipment is sold to these institutes and this is having its effect on Allahabad.

Today, there are quite a few communities of Allahabad on portals like Orkut. Even the government of India has done its nominal bit by setting up a STPI in Allahabad, thinking that companies would flock to a place like this. But they haven’t really. Till the ground level situation improves drastically not many companies would like to stick their neck in Allahabad.

But before we go, let me underline again the amazing intellectual and intelligent abilities of Illahabadis with an instance. Last year, the High Court in Allahabad was in news for very different reason. Thanks to a committee set up, the honorable high court went online so as to say, by having its own portal, http://www.allahabadhighcourt.com/. The best thing was, all the judgments of the court were not only available now in ODT and ODF format (the court underlined its commitment to FOSS), but they were available in RSS. Thereby making Allahabad court, the only probable court in the whole world to make judgments available through RSS.

Thus one might not be able to really see any outwards signs but a silent revolution of bits and bytes is indeed taking place in Allahabad, driven by institutes like IIIT Allahabad and others. So ignore this holy city at your own peril.

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Surat: The jewel in the crown

Diamonds and Surat are synonymous, after all 92% of all diamonds in the world pass through the town. Surat is the diamond capital of the world, where much of the polishing and cutting takes place. Surat also happens to be the textile town, with scores of textile mills that lie in and around.

But the ascendancy (if we could term it as ascendancy) of Surat has not been sudden or in spurts. Since the times the Mughal dynasty ruled, Surat started emerging as a premier trade centre. Surat had a major port and trade tries spread all across the world. Also travelers to the annual Haj had to travel through Surat itself. So by the 17th century, Surat was one of the foremost cities of India, so alluring that even Shivaji sacked the city twice to be able to fund his war campaigns. The British East India Company for the first time settled their factory in Surat, before eventually shifting to Bombay. But then, things changed and Surat fell into disrepute.

Things went so bad that the city had to be quarantined because plague that spread across Surat. So that is story of fall of Surat.But now, thanks to vibrant support of the Gujarat government, the economy is again picking up. The state government has chalked an aggressive plan to promote the state as a knowledge hub and make best use of the intrinsic qualities of each city.

Since much of the gem and jewelry centers are present in the city, obviously it would be these firms that would take a lead in terms of modernization efforts. Thus the government announced the setting up of a special economic zone (SEZ) at Icchapore near Surat. Set to be completed this year, the SEZ will supposedly drive the economy of Surat in a big way. There will be quite a few specialized IT companies present in the SEZ that cater to the industry.The textile companies have also had an impact on the domestic market, as the mills like Govardhan, Everest and Motiani Fashions have modernized and used computers for mass scale production. This as coaxed companies like Sun Microsystems and IBM to have a focus on these markets as well. As much of the upper segment of tier I cities nearly taken, vendors are eagerly on the lookout for business potential of tier II and III cities. As many of the big players have given Surat a skip, it is the internal companies itself that have taken the onus of modernizing, like Asian Vision and Gati Softtech Solutions, etc.

Even the channel industry seems to be perking up to the opportunity, evident from the fact that they have been growing at a rate that is as good as any other in Gujarat if not better. The top three players from Surat are Jupiter Automation (annual turnover Rs. 25 crore), Valsons Computer (Rs. 22 crore) and Chopra Enterprises (Rs. 11 crore).

From the perspective of education, Surat offers good facilities like SVNIT, CKPCET, SCET, and others. This bodes well for the city as it looks to ramp up for growth for the future. Much of the growth again will come from the textile and jewelry business itself.

Surat is a vibrant city in close proximity to Mumbai. It is also immensely cosmopolitan city. A century or so ago, Russian literary stalwart Leo Tolstoy had crafted a short-story, wherein the action takes place in a Coffee-house of Surat. In it people from all across the world come together to discuss and debate on issues of varying interests. So there was a Persian mendicant with his African slave, a Hindu Brahmin, a Turk, a Roman Catholic, a Protestant, a Jew, a Chinaman, etc. Even to this day, Surat maintains the spirit of multi-culturism. History might not have been fair to Surat, bringing about constant upheavals in the city’s fortune. Yet, the future beckons brightly, much like the diamonds that pass through the city and dazzle the world with the glitter.

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Nashik: From Myth to modernity

Traveling through Nashik is an experience by itself, the outskirts of the city is as agrarian as you can get with the farmer and bull duo tilling the land and inside the city there are the multiplexes and the flyovers. So on one hand there exists a Nashik that is extremely rural, and on the very other it is up-to date and modern with all the computer hardware boards, etc. The dichotomy is hard to miss.

Even the agrarian picture is quite different from any in India. The small fields have these small bamboo sticks that jut out, a few feet in length and placed at some small distance apart in a very methodical way. Finally the whole field is covered with a parchment of sorts that conceals the fruit rather brilliantly. But then who does not know about those “sweet grapes” from Nashik. Much of the grape produce of Nashik is converted into fancy wine and sold under brands like Sula, etc. Passing through these fields, one cannot miss the similarities between Nashik and other popular wine destinations like Riviera or Napa valley.

Lying just a few hundred kilometers away from Mumbai, Nashik is indeed the place to be in. There is a hectic buzz of activity, of entrepreneurship, that truly sets the city out. Even the administration seems to have woken up to the potential of promoting Nashik and has started doing so in a small but significant way. There has been a concerted effort to start up industrial zones that more or less help the SMB segment. As of now, there are close to 6 MIDC and 10 Co-operative Industrial Estates in existence in and around Nashik and more are coming up. There has also an STPI established on the Ambad region.

In the past few years, industrial activity has really picked up in Nashik, especially after the launching of a mega SEZ in Sinnar area. Many reputed companies like Mahindra & Mhindra, MICO, Siemens, Crompton Greves, Kirloskar, Reymond steel, Jindal, Brook Bond, L&T, Ceat, VIP, Carbon Everflow, Garware, Jyoti Structures, Samsonite, Datar Switch Gears, Glaxo India etc. have established their units in Nashik. This has led to a spurt in IT adoption in the region. Even the PSUs are aiding the local economy, companies like India Security Press, Hindustan Aeronautics Ltd., Currency Note Press and Thermal Power Station etc. are located in Nashik.

The region also has more than its fair share of educational institutes. Around 9 government ITIs, 13 private ITIs, 2 engineering colleges and numerous other institutes. This ensures steady availability of talent for the industries. The big drawback as of now in Nashik is the power situation, frequent load shedding can be quite a bane. But then it statewide issue and not something specific to Nashik and as and when the issue is resolved for the state so will Nashik benefit.

Due to the close proximity of Nashik to both Mumbai and Pune, it has been touted as an ideal BPO destination. A vindication of the same was when WNS arrived in Nashik after acquiring ClaimsBPO, an offshore division of the US-based Green Snow Inc, which provided HIPPA-compliant BPO services. As of now, around 7-8 non-voice BPO companies, including Mumbai-based Tricom India and WNS Global Services, are working out of Nashik. There are also a close to a half-dozen smaller BPOs that have an average of around 50 each.

To sum up, Nashik is indeed a very good investment opportunity from the perspective of RoI and also the potential of growth. Not only that, the city is also renowned as a pilgrimage center, with the Shirdi close by and Sai Baba looking over the city. In fact, Nashik derives its name from an incident in Ramayana, wherein Lakshman cut off Ravan’s sister Soopankha’s nose (nasika/nak). The history of this region stretches out to pre-historic times. One can find almost everything in Nahik, right from modernity to mythology. The grapes are certainly sweetest, here!

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Raipur: Emerging out of shadows

Here is a small test, ask any of your friends to identify Raipur on the Indian map, nine times out of ten, he or she will fail. Now, ask your friend where is indeed Raipur and even on this seemingly easy test, many will falter. And that sums up much of the problem with Raipur.

The capital city of new formed Chattisgarh state is not all that well-known on even a national scene. It has been over 6 years now since Chattisgarh was carved out of Madhya Pradesh. Lying on the precious mineral belt in central India, Raipur has a whole lot of mining companies that have set up operations in and around Raipur. Traditionally, the city of Raipur has been described as “an agricultural-processing and saw-milling town”. The city is located centrally in the state of Chattisgarh, and serves as a regional hub for trade and commerce for a variety of local agricultural and forest products. There are several small-scale industries, which include oil milling, soap manufacturing and electrical welding.

Not only that the region is also emerging as an important educational hub. A lot many engineering colleges have come up in and around Raipur providing excellent educational facilities. In fact many domestic IT companies regularly go to these colleges for campus recruitments, companies like TCS, Wipro, Cognizant, iGate, and others. The famous colleges are Raipur Institute of technology, National Institute of Technology, AT College of Electronics and MJ College of Information Technology. These colleges ensure that there is a steady stream of employable talent available in Raipur. Though the government of Chattisgarh was caught in a situation when the Supreme Court came down heavily on the high number of universities cropping up, even Aptech had fallen for the lure and launched a university operations in Raipur.

The state government is also actively wooing IT companies and asking them to set up shop in Raipur and invest through the SEZ way. A few companies are supposedly assessing the possibility, whether it is feasible in the long-term considering the geo-politics of the region.
The government of Chattisgarh is actively promoting the use of ICT for development. In this regards, a host of e-governance initiatives have been launched within the state. Recently the state government launched the first e-Court system in Raipur. In fact, the government has created a vision document that speaks about how it will pursue e-governance initiatives. One of the objective that is representative of all, says, “ICTs will be used extensively in enhancing the productivities and efficiencies substantially in all the sectors of the economy, especially, agriculture, manufacturing banking and services sectors.”

The change is quite evident when one sees the emerging channel industry gaining strength and growing at a healthy rate. There are quite a few strong channel players in Raipur that mainly cater to the industries and the SOHO as well. Some of the names are, Priyanka Computer Services (annual turnover Rs. 22.79 crore), Balaji Computer (Rs. 12 crore) and Shriram Computers (Rs. 8.5 crore).

But the change is very evident, recently, the states and Raipur very first mall, ‘City Mall 36’ was inaugurated. The mall comprises number of national and international brands such as INOX, McDonalds, Big Bazar etc. According to news reports, Raipur is getting ready for 7 more such global malls by end of 2008 namely. Even the TAJ group of
Hotels has started the constructing its Five Star Hotel in Raipur. The government is also actively developing a vast tract of land near the city, dubbing it as Naya Raipur. The place is well-laid and would have the best infrastructure available in the whole of the state. According to many, once this project is completed, moving to Raipur (for IT majors) will not be difficult decision to make.

All these factors are indicative of major change that is happening on the ground at Raipur. For long it has remained under the shadows of bigger cities like Indore, Bhopal, Nagpur and others. Now it is finally ready to break out.

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Chandigarh: Symbol of the future

Jawaharlal Nehru wanted to prove a point and many with Chandigarh. He envisaged the city to be a metaphor of modernity, a symbol of the tryst that we had embarked on. After having witnessed the bloodiest human migration in history in the form of partition, Nehru decided to build a beautiful capital city for the state of Punjab. He famously proclaimed Chandigarh to be “unfettered by the traditions of the past, a symbol of the nation’s faith in the future.” Like any of the city-builders in history, he would not leave a stone unturned. So the best architects were involved in the project, namely Swiss-born French architect and planner, Le Corbusier and American architect-planner Albert Mayer who was working with the Polish-born architect Matthew Nowicki. And thus Chandigarh came into existence.

Today some 5 decades or so later, one needs to revisit Chandigarh again to assess whether it is still a beacon for modern India or just milestone left behind. Speaking from the perspective of IT industry, Chandigarh has largely been a mixed bag. The biggest draw of the city is definitely the amazing infrastructure, the broad roads and the comfortable housing. Yet, IT companied have not really flocked to Chandigarh, setting up their shops. Rather strange, if one considers the fact that in North India, there is hardly any city that can stand in comparison of Chandigarh, with the possible exception of Gurgaon.

A host companies like Infosys, Quark, Dell, Webart Softech, Netsoft Informatics, and others have already set up base in Chandigarh. The government had some years launched the Mohali SEZ amidst much fanfare, though according to certain observers there hasn’t been much difference on the ground. Not only that, there have been numerous discussions on how well suited Chandigarh is for BPO work, a few companies have indeed set up shop like IBM Daksh, Kalldesk, Bay Infocomm, UCIL and others.

Now, another exciting project is coming up in close vicinity, an IT Township in SAS Nagar. A Consortium formed by Reliance Industries, real estate investor Landmark Holdings, Berggruen Holdings India, subsidiary of a New York-based company, and Punjab-based Yellow Stone, is expected to infuse over Rs 950 crore in the IT township. The project, to be set up within 10 km of the upcoming international airport at Chandigarh, is expected to set aside 60 per cent of its area for IT companies, 30 per cent for housing and 10 per cent for commercial operations. Considering the host of engineering colleges in the vicinity, Chandigarh still has the potential to be a symbol of the future, all it needs now is a big push, that’s it.

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Coimbatore: Moving up with Speed

Like its beloved son, N Kartikeyan, Coimbatore also seems to be in love with speed. How else can one explain the rapid work that is taking place in Coimbatore. After Kochi, Coimbatore is place in South India that is witnessing a construction boom. And if that was not enough, a new IT park is being constructed by ELCOT and TIDCO.

Infrastructuraly speaking, Coimbatore has always been known for its well designed roads and well though out architecture. Renowned as the Manchester of the East, because of so many textile mills in close proximity. The city’s primary industries are engineering and textiles. The district also houses the country’s largest amount of hosiery and poultry industries. Most of the industries are run by entrepreneurs, often indigenous with family based or community financing. The city’s industrial growth started in 1920’s and accelerated after independence, without any government assistance or the entry of external industrial houses. Of late, information technology companies have started opening offshore development centers in the city.

The result: a robust economy and a reputation as one of the greatest industrial centers in South India. The engineering prowess of Coimbatore can be gauged from the fact that TCS has already established its Centre for Engineering Services.Coming back to the park, according to reports, Wipro is quite keen to be the anchor partner for the park. Whereas there have been enquiries from Satyam, HSBC for back-end operations and a few companies from Bangalore and Chennai too for readymade space in Coimbatore to begin their operations. A CII-commissioned study by Pricewaterhouse Coopers indicates that companies setting up shop in Coimbatore can increase profits by 60 per cent compared to those in metros. Coimbatore has more than 80 engineering and arts and science colleges, so it has an abundance of talent for the kind of workforce required.
The city also boasts of two STPI earth stations, one at PSG- Science and Technology Entrepreneurial Park (STEP) and another at the KG Information Services Limited (KGISL) campus at Saravanampatti. But things are changing steadily. Some of the major industries are Lakshmi Machine Works(LMW), Premier Instruments & Control Limited(PRICOL), ELGI Equipments, Roots Industries, KSB Pumps, Dresser Valves, Flowserve, Janatics, Texmo Industries, Aquasub, Sharp Industries, CRI, Deccan Industries & ITC. Suzlon is also setting up a huge plant for renewable energy.

Also the fact that till quite sometime back, the minister at the Centre, Dayanidhi Maran was quite keen to see Coimbatore as a favored destination also helped.

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Mangalore: Fishing for big investments

From a sleepy fishing hamlet to being the fastest growing non metro in South India, Mangalore (Mangalooru to be precise) has indeed transformed much over the years. Yet the transition is not that startling, simply because Mangalore always had the potential to emerge as one of the biggest cities of India, even in comparison to ‘former pensioner’s paradise’ that is Bangalore.

The reason is not much hard to find, since the middle ages, coastal Mangalore has always been a vital trading point on the western shore. Thus produce from surrounding areas namely Kerala, Goa and even Maharashtra was traded through the harbors of Mangalore. Thus, over the last many years a number of related industries came to exist in Mangalore. Right from coffee traders to ship building companies like Swan Aquatics, etc. Not only that, there are a few major chemical and fertilizer companies also present in Mangalore like Mangalore Chemical and Fertilizers Ltd. (MCF), Kudremukh Iron Ore Company Ltd. (KIOCL), Mangalore Refinery and Petrochemicals Ltd (MRP), BASF, ELF GAS, etc.

Nonetheless, Mangalore is ready to move to the next level, in fact it is very much doing so and is wooing IT companies in a big way. Infosys is truly the first and the biggest in Mangalore. Spread over an area of 300 acres, Infosys’s campus in Konaje is quite a landmark by itself. Infosys also has significant presence in Blue Berry Hill STPI in Mangalore. Wipro is also actively working on a facility in Mangalore to complement its huge campus in Mysore.

Meanwhile, there has been lot of talk of how well suited Mangalore is for BPO activities. According to many, the region has more scope for BPO than software because of the high education level. Mangalore has plenty of renowned schools and colleges in the city or the near vicinity, thereby supplying a large labor pool. Little wonder, than MPhasis BPO had set up shop in Mangalore. Not only Indian companies but even MNCs are keen to make a move to Mangalore. Take the case of First Indian Corporation; a wholly owned subsidiary of The First American Corporation has started operations in Mangalore.

As the city of Mangalore attracts investment, so is the infrastructure steadily growing. Off late, the Mangalore airport has been operational and there has also been quite some talk of making it international. With a host of engineering colleges in the vicinity (KERC and PA College), there is little doubt that Mangalore is going to be a major draw for IT companies (the IT exports from city will amount to Rs. 1000 crore by 2007 end). What remains to be seen whether this coastal paradise is able to retain its intrinsic charm in wake of all this high-fly investments. One sure hopes so.

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Mysore: Not a mere satellite

For Mysore, its close proximity to Bangalore is both a boon and a bane. Indeed over the last few years, there has been a major spurt in investments in the hilly town due to the supposed saturation in Bangalore. Companies right from Indian IT majors to MNCs have in some way or the other chalked out a map to make use of Mysore mainly because of its close proximity to Bangalore. And this is quite disquieting.

Before India attained independence, Mysore was regarded as one of the premier princely states of India. Unlike many other royal maharajas who splurged money on themselves and themselves alone, the Wodeyars (the ruling family of Mysore) was certainly not the same. Take the case of Chikka Devraja Wodeyar, who ruled from 1673-1794 and widely reformed the empire by dividing it into sections called as chavadis. Meanwhile, Krishnaraja Wodeyar who ruled from 1902 to 1941 was largely responsible for much modernization of Mysore. Not only was he a great patron of art but also a visionary. He set up numerous educational institutes during his reign, the most memorable being the Indian Institute of Science at Bangalore (he gifted 11 acres of land for it).

Thus, Mysore was much modern before the Silicon magic wand transformed Bangalore. It never did have the big heavy industries, except for Mysore Sandal Oil Factory or Krishnarajendra Mills. Much of the industries were traditional in outlook and small in scale. So while Bangalore hogged the limelight as an IT hub, Mysore continued to retain its old world charm, as the cultural capital of Karnataka. But that is set to change as well.

For the industrial development of the city, Karnataka Industrial Areas Development Board (KIADB) has established four industrial areas in and around Mysore, namely, Belagola, Belawadi, Hebbal (Electronic City) and Hootagalli. This has resulted in fair amount of optimism among IT players about the potential of Mysore. Infosys has made a big splash already by setting up one of the largest technical training center in the world located over an area of 270 acre and can accommodate over 4500 trainees at a time. Wipro has also established its Global Service Management Center (GSMC) in Mysore to complement its facility in Bangalore. There have been a few BPOs also coming up in Mysore, Hinduja TMT launched a 1000-seater sometime back in Mysore

Mysore now boasts of a four-lane high-speed expressway from Bangalore and is hoping that the government keeps its word on providing better infrastructure, connectivity and the much publicized BPO park in Bogadi that would lead to the city’s growth and attract more companies. In the year 2006-07, Mysore contributed Rs. 760 crores to Karnataka’s Rs. 48,700 crore IT exports and has already overtaken Mangalore as the second largest IT center in terms of revenue. But there have been a few controversies as well, namely the tussle between Infosys and the former prime minister Deve Gowda on a range of issues from infrastructure development to things else.

All in all, Mysore needs to be assessed as a city by itself and not due to mere proximity to Bangalore and even on its sole merits it scores wonderfully well. It isn’t a satellite but a planet by its own.

***EOM***

Getting to meet and interact with people from diverse cultures and different regions are certainly one of the biggest perks of being a journalist. People take time out for you, indulge you, talk, explain and often entertain you. You are not considered a hindrance and oft times are awarded warm welcomes. So when Dataquest decide to come out with an issue on emerging cities (later renamed as Future Cities) of India from the IT perspective, I was all excited. I got a great chance to visit cities like Kochi, Trivandrum, Nagpur and Vadodara. I met with people from different companies, from a scientist at BARC in Vadodara to VP from Lord Krishna Bank in Kochi to IT head at Haldiram in Nagpur.

Over a fortnight, I was travelling to all these cities and trying to create a true picture, finding out what makes the cities tick, what are the problems faced and what are the advantages that companies like Infosys, TCS or even IBM have from moving to cities like these. It was an enriching experience, as there was so much that I got to learn from so many people I met. Herein I am putting up the first three profiles of the places I visited. A small disclaimer; the pieces here might differ from the actual ones published due to numerous reasons like sharp editing or paucity of space. I would be putting up a post on my experiences in my personal blog (zewak.blogspot.com) soon enough. The three cities follow:
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Kochi: Now the God’s have IT

The idyllic coastal township is set for big things, as now is banking on IT for them.

“Azim Premji is not only one of the richest Indian but also the toughest Indian to convince,” quips Girish Babu. He must know well because as the former CEO of Infopark, and COO of IT parks, Kerala; Babu was trying hard to convince Wipro to set up base in God’s own country. The sprawling Infopark had been operational in Kochi for year or two and a few entrepreneurs had taken space. But there could not be a better endorsement than Wipro and Babu was well aware of it.

Meanwhile, Wipro had also checked out Coimbatore and company officials were keen for a more developed and investor friendly Tamil Nadu over scenic but labor-issues ridden Kerala.
After much hard lobbying, Wipro set a condition; whichever state gives the company SEZ status first, will get the investment. Babu got cracking and within a day or two was ready with the letter and sent it across to the company. It was in September 2004 that Wipro acquired some 25 acres land and set up operations in the Infopark. “With Wipro much of the perception problem associated with Kerala was solved to a great extent and the gates were open for fresh new investments,” reminisces Babu.

Indeed post 2004, Kochi has literally donned new robes. A trip down the port city and one will be amazed at the frenetic activity all round; big billboards featuring Malayalam stars Mohanlal, Mamooty and even Hema Malini, lord over the cityscape. Newspapers are fully of adverts of upcoming luxurious residential projects all over. There is not a single global brand that would be missed at the malls lining the Marine Drive. Kochi, the commercial capital of Kerala, is shining bright much like the hundred of Alapatt and Alukkas gold showrooms spread all over.

A case of infrastructure
From back in the middle ages, Kochi had been a centre for trade and commerce. The port city had traders flocking in from Manchuria to Persia and beyond. It was a simmering pot of cultures and leisure, coaxing a Chinese traveler to comment that “If China is the place where you earn money, Kochi is the place to spend it”. When the Portuguese under the leadership of Vasco Da Gama were shunted out of Kozhikode (Calicut), they landed up in Kochi and set up the first European factory or trading post.

Post independence, Kochi lost the race for industrialization and the economy more or less stagnated even though the big companies were indeed present. “It was indeed ironical, as Cochin always was more progressive of the cities in all of Kerala. There was the prosperous port and refinery company and of course the Cochin Shipyard, the largest ship building facility in India. Yet the city did not much benefit from all these companies,” says MV Paul, deputy director (Systems), Cochin Port Trust.

Yet, Kochi maintains its lead in terms of physical infrastructure and can give any Tier II city a run for its money in terms of infrastructure. The city has a very reliable power supply, with close to 7 power stations in the vicinity feeding power to the city. There is also no shortage of water supply thanks to the Kadambariar river. And the best of all is the International Airport at Nedumbasserry, the first privately built airport in India. Today there are close to 450 landings every week at the airport and was the only airport in India where the Airbus A380 could land.

Close to the airport in Kakkanad, around 25 kms from the city centre, i.e., Ernakulam, are the upcoming IT hubs. The infrastructure is indeed mind-boggling, there are the broad 4-lanes roads and small landscaped gardens at the roundabouts and of course the imposing glass towers. Except for Infopark, there are new IT parks coming up from L&T, Leela, Muthoothu, and of course the SmartCity by a Dubai based conglomerate.

Little wonder, post Wipro, now TCS has also set up shop in the city. Infosys has agreed for investing in Technopark in Kerala and is also considering at some sort of investment in Kochi as well. According to a Nasscom report, Kochi is best suited for BPO, both voice and non-voice. Currently, ACS and Sutherland have big investment in the Infopark and the way they are expanding, the investment seems to be working. “Currently Kochi accounts for around Rs. 1000 crore of IT exports annually, it will overtake Trivandrum in sometime,” says Babu.

Doubly connected
Kochi is only the city in the country that is the landing point for both SEA-ME-ME3 (it lands in Mumbai) and SAFE undersea cables that connect the country to rest of the globe. Also, gigabyte router of VSNL gateway lies in the vicinity. Because of this unique characteristic, Kochi is always connected, and also best suited for voice based services due to less loss of time due to latency.

“Kochi is the best city in terms of bandwidth connection, as around 80% of Indian traffic is routed through the VSNL gateway. We are very bullish about the prospect of the city and keen to develop IT across the state through the hub and spoke model, where small centres will mushroom around bigger ones like Kochi and Trivandrum,” concurs KR Jyothilal, special secretary, Department of IT, Kerala.

The genteel Malayalee
If that was not good enough to convince people, there is of course the amazing manpower story from Kerala, the first state that was cent percent literate. Kerala also has the distinction of having the largest pool of English speaking manpower and the highest density of IT professionals. The world may have painted a sordid and a combative picture of a Malayalee that is constantly waving the red flag of protest.

But the reality is much in contrast. Thanks to decades of working in other more developed markets in the UAE and US, the modern Malayalee has a more global outlook that any of his up country cousins. Not only is he (or she) well aware of market dynamics but quite willing to inculcate the values of the service industry. Visit any hotel in the city and you will understand the change. The hammer and sickle are best left to the politicians while every one else seems to be pursuing the good ol’ Gandhi or even Monsieur Washington.

As Kochi is just a few hours away from Bangalore, much of the Malayalee professionals that had shifted to the city due to lack of opportunity are quite willing to head back home. Babu talks of how companies in Kochi realized that they had more walk-ins when they advertised the job openings in Bangalore and Hyderabad rather than in Kochi itself. And thanks to the many colleges in the vicinity there is also the abundance of raw talent. “One should hire the employee for his aptitude and train him for his talent. The professionals of this city have the best aptitude, thanks to it being a commercial city that one can find in Kerala or even in South India” says S Venkataraman, deputy director, Lord Krishna Bank (now Centurion Bank).

Red fears
While all may seem outwardly fine, there is indeed a lurking fear in the minds of players in Kochi about the future potential of the city, especially the flip-flop between the Congress and the Communist. While the government officials may argue that investment climate is not affected by change of governments. There does seem to be an ever-so-slight slowdown. Take the case of the SmartCity project, it was riled in controversy in Kerala, while both Karnataka and Andhra Pradesh were ready to offer concessions for the project to shift.

“Kochi has as good as a potential as Hyderabad or even Chennai. We have suffered because of lack of political will. Kerala had a head start over the others when we started with Technopark and yet we have lagged. It is a matter of leadership not ideology as even West Bengal is doing well even though it has been ruled by communists for decades. We are really praying for a good leader,” says Benley Noronha, managing director, Nortech Infonet.

For Ajith Brahmanandan, state information officer, NIC (Lakshwadweep), it is a matter of infrastructure and bad planning. “If you travel through the city of Kochi, especially through Ernakulam, what strikes one is the woe-full planning. In fact, there is no plan at all for the city even though it continues to burst at the seams with people and more people. The government really needs to pay attention to the basic infrastructure,” he says.

Jyothilal dismisses these concerns and terms them as teething troubles. “It is all perception. Even though the governments have kept changing, the policies have not deviated. Today the investment climate is independent of politics and everyone understands the value of IT. That is one of the reasons why the CM himself handles the IT portfolio. Even his son and so many other politicians children are working in the IT industry,” he states.

Whatever is the case of the political front. One thing is certain, Kochi is surely the place to be, if you are not already there. From the time Monsieur Da Gama landed (and subsequently died as well) in Kochi, the city has had a whole lots of firsts, be it the first territory to be colonized, the first state to join Indian dominion, the first to have a private airport, etc. the list just keeps going on. The idyllic backwaters, the scenic sea front and of course the innumerable getaways in close vicinity, makes Kochi a tempting place to shift. The reality market is really booming and everyday counts. After all if the one of richest man (supposedly the smartest as well) in India endorses the city, there is little that can really go wrong. Can it?

**EOM**

Nagpur: From Oranges to IT

Zeroing on the Zero Mile City of India

“What else can you get except oranges?” a friend of mine commented, before I set out for Nagpur. The “What else” really baffled me, indeed, come to think of it; there isn’t much that one associates the city with, except the citrus fruit.

With much apprehension, I landed at Dr. Ambedkar airport, only to find chaotic construction all around. There was much frenzy in the air and one could discern quite a few construction cranes in the foreground and the constant din that one associates with them. Five minutes out of the Airport and a first timer like me is bound to be taken aback by the physical infrastructure, the 4-lane concrete roads and the daunting flyovers. It is very unlike any Tier III (or even tier II) city that you will see in India. And that is biggest irony.

Nagpur, the second capital of Maharashtra is the largest city in central India. Located practically at the centre of India, India’s geographical centre (Zero Mile) passes through the city. Thus every distance in India is measured with Nagpur as the starting point. In fact, for quite sometime (to be precise, since the British times) there have been talks of making Nagpur the second capital of India due to its strategic location. Certainly, the infrastructure is worthy of a capital city.

The strength of infrastructure
According to a recent study conducted by UK-based estate consultants Knight Frank, among a host of other cities, Nagpur is ranked at number 1 in terms of physical infrastructure, at par with Chandigarh and ahead of other cities like Vishakapatinam, Jaipur, Kochi, Goa, and others. This is quite a vindication for a city that has largely been untouched by rapid economic developments made elsewhere in the country.

The city is also well connected both by road and railways to different parts of the country. In fact due to its location, Nagpur is the transit point for all the trains that connect the country lengthwise and breadth wise. The city is also connected by air to all the major airports and now even has international flights connecting the city globally. And if that was not enough, with the launch of Multi-modal International Hub Airport at Nagpur (MIHAN) in 2002-03, the city is truly become an important transit location not only nationally, but also for the sub-continent. But more on that later.

The city also had a robust power supply till quite recently. In fact, it had been a power surplus city before the government decided to divert the power to more economic zones like Mumbai and Pune. As of now, there are a couple of hours of planned load-shedding on a daily basis. The residents are agitating against the diversion of power; if they succeed Nagpur will indeed be power surplus again.

An Industrial hub
Spread over an area of 250 sq. km., Nagpur was one of the first cities in India that embraced industrialization. Way back in 1877, Tata’s started the country’s first textile mill, the Central India Spinning and Weaving Company Ltd., in Nagpur. Since then, the city has been the centre of commerce in the Vidarbha region and currently is a large trading centre for a number of commodities and services. A large number of industries are located in Butibori industial area that lies in vicinity of Nagpur. Similarly, there are quite many companies like Mahindra & Mahindra, NECO, Bajaj Auto, Vicco Laboratories, etc. are present in the Hingna industial estate on the western fringes of the city.

IT companies are also waking up to the potential offered by Nagpur, namely in terms of good infrastructure, abundant and cheap labor pool and of course the SEZs. Already a number of companies have taken up space in Nagpur, like Satyam Computer Services and L&T is setting up an Infocity.“Much of the IT business in Nagpur is driven by these companies. There are a few companies that are based in Nagpur and hence local players are benefited. Till few years back not many hardware vendors had a presence in Nagpur but that had changed dramatically. Today every company from IBM to HCL has a representative in the city. Even Microsoft has come here officially and grown by over 900% last year alone,” says Vinod Verma, CEO, Key Computers. “Also the fact that there is no other major city in 300-400 km radius helps the case of Nagpur,” he adds.

One of the major buyers in the region is Indian Air Force that is head-quartered in Nagpur and spends close to Rs. 2-3 crore annually on IT.

MIHAN effect
Nonetheless, every one in Nagpur seems to be talking of just one thing, MIHAN. Go to any software company or an IT vendor, or even some one who is not related to IT at all, he or she would not only know the complete details of MIHAN, but will also rattle of statistics to prove that it is indeed the best thing that could have happened to the city. Not surprisingly, after decades of neglect Nagpur has finally got a project that it deserves and that too the biggest infrastructure project in India.

Taking a chapter right out of China, the government of India is beefing up Nagpur as a major hub. So around the airport over 2000 hectares of land has been earmarked for the MIHAN project. The government agencies are ensuring that this project is of global quality, thus the construction is high grade and so are all the other amenities, right from bandwidth availability to medical facilities. Little wonder, major companies like Satyam Infotech, GE, DLF, Shapoorji Pallonji, L&T Infotech, Patni Computers and Microsoft have taken up large parcels of land in the SEZ within the project. And that is not all; TCS has also announced setting up of 5000-seater facility in Nagpur. Even MNCs like IBM and Dell has taken up space in Nagpur.

“MIHAN is going to completely change the face of the city. It has been the biggest thing to have happened and all of the players within the city as well as outside it are keenly awaiting its completion,” says Malathi Swaminath, managing director, Zeta Softech. An entrepreneur who set-up shop in Nagpur quite few years back, Swaminath is quite bullish about the prospects of the city and has even taken up space in the project.

Costing around Rs. 3500 per sq. feet, MIHAN does indeed make great sense, especially considering the facilities and the amenities that are provided. “MIHAN makes a lot of sense for sense for IT companies that want to set up shop in Nagpur in a big way. Not only is it cost-effective but as the colleges and residential area is in close proximity, there will not be a shortage of manpower to companies working out of it,” says Rakesh Agarwal, CEO, Mayur Computers.

A scientific hub
That brings us to another big plus point of Nagpur, its educational prowess. Over the years largely due to the presence of innumerable engineering government companies, Nagpur has emerged as a scientific and engineering hub. The city is the home to a number of national level scientific and governmental establishments like the National Environmental Engineering and Research Institute (NEERI), Central Institute of Cotton Research (CICR), National Research Centre for Citrus, National Bureau of Soil Survey and Land Use Planning (NBSS–LUP), Jawaharlal Nehru National Aluminium Research and Development Centre, the Indian Bureau of Mines, India’s Intellectual Property Training Institute, the National Academy of Direct Taxes, the Chief Controller of Explosives of the Petroleum and Explosives Safety Organisation, and the South Central Zone Cultural Centre in addition to a regional office of the Indian Meteorological Department.

The city also has several reputed engineering colleges like the Visvesvaraya National Institute of Technology (VNIT), Priyadarshini College of Engineering, Yeshwantrao Chavan College of Engineering, Ramdeobaba Kamla Nehru Engineering College, Laxminarayan Institute of Technology (LIT), G.H. Raisoni College of Engineering, as well as several reputed public as well as private colleges like Dr. Ambedkar College and others. According to an industry player, VNIT has recently set up a nano-technology center in Nagpur, one of five in all of India.

“Nagpur biggest strength is its educational institutes. With around 18 engineering colleges in and around the city, there is a steady flow of workforce. The big problem was that till now there was not much opportunity for these people. But that is changing and as benefits from MIHAN and other projects percolate, Nagpur will see reverse brain drain. All the Nagpur citizens that had to leave the city earlier, will surely flock back,” says Chandrahas Chaudhari, technical head (Business Services), ADCC.

“At the very core Nagpur people are very nice and chilled out; they seldom like to settle down in other cities. Also they are very dedicated and the attrition rate is almost marginal,” adds Swaminath. She was born and raised in Mumbai and settled in Nagpur post marriage, but now prefers the city over the hustle-bustle of big metro like Mumbai.

“Nagpur has all the makings of an IT hub, but sadly it has not been the case. According to me the city is very well suited for high-end R&D and has one of the best engineering graduates that you can find anywhere in the country. The only problem is that it gets a tad to hot in the summers,” says AK Maji, director (Acting), NBSS-LUP.

For far too long Nagpur has been a victim of political machinations. The region (Vidharbha) has been wanting to separate from the state of Maharashtra, which does not want to let go because of the immense natural wealth (remember Chota-Nagpur mining belt). The city has dragged along almost valiantly, been relegated to secondary status within the state.

But all that seems to be changing now and those huge cranes near the airport are laboring towards a new morrow. Nagpur’s time seems to have come to reclaim its rightful position under the sun. So next time, someone asks you “what else” in context to Nagpur. Don’t dwell on it much and ask him to get a new perspective because very soon oranges will have to find a new place as all the orchards would be replaced by campuses and IDCs.

***EOM***

Vadodara: Rise of culture

Dewang Mehta and Sam Pitroda, the two people who single handedly changed the face of Indian IT and telecom, found their bearings in Vadodara

It is a common Indian practice to associate cities with individuals. And the more famous and more numerous celebrities a city can boast, the more it’s snob value. So MK Gandhi is intricately linked with Porbandar and Rabindranath Tagore is associated with Kolkatta, Dhirubhai Ambani with Jamnagar. In more contemporary context, Amitabh Bachchan and Allahabad go hand in hand, while Sachin Tendulkar represents Mumbai, so on.

Going by this logic, Baroda, or Vadodara, should be termed as cradle of Indian IT & telecom, as two of its denizens single handedly changed the face of Indian industry. The first one, Dewang Mehta (born in Umreth, on the border with Anand district) to Indian IT to the world and brought the world to Indian IT. The late president of Nasscom was the public face of Indian IT. Meanwhile, Satyanarayan Gangaram Pitroda or popularly known as Sam Pitroda found his bearings in Vadodara, while pursuing his Masters in Physics and Electronics from Maharaja Sayajirao University. The current chairman of Knowledge Commission and the CEO of C-SAM, is hailed as the father of the PCO and the precursor to telecom revolution.

Yet, the city of Vadodara has largely been untouched by the magic of technology. While the government over the years has actively promoted Surat, Ahemadabad and Gandhinagar; Vadodara has been largely ignored. Ask any citizen and he was look at you askance, no one really seems to have an answer as to why things went the way, they went.

Industrial behemoth
It is quite baffling, considering that the city was at the very forefront of industrial revolution at the turn of the twentieth century. The first modern factory (Alembic Pharmaceuticals) was established in Vadodara in 1907 and subsequently companies like Sarabhai Chemicals, and Jyoti came up in the 1940s. Steadily over the years, Vadodara became a hub for chemicals and textile industry.

If that was not enough, in the late sixties, oil and gas companies made a beeline for Vadodara. Out of the blue, Vadodara was a host to companies like Gujarat Refinery, Indian Oil Corporation. Discovery of oil and gas in Ankleshwar led to rapid development of the city. Even ONGC and GAIL set up there centers in the outskirts of the city. Followed by the oil and gas majors, fertilizers and chemical major like Gujarat State Fertilisers & Chemicals (GSFC), Indian Petrochemicals Corporation Limited (IPCL, Reliance) and Gujarat Alkalies and Chemicals Limited (GACL) also set up shop in the region. By the eighties, the city was brimming with activity, and there was a vibrant SMB sector.

That was before the recession set in. Over the next many years, the city stuck by economic gloom. As the whole Gujarat state went downhill on the economic parameters, so did Vadodara. In the nineties, the situation was so bad that a lot of the SMBs had to shut shop or ship out. That was quite the case till the Modi government came in power in the State after which much of the recession was arrested and subsequently reversed. While Vadodara might not have gained from the boom, it certainly did not stagnate.

From industry to IT
The tide might be turning, or at least there are some signs that it could. There has been an awakening of sorts in regards to the use of IT. Pharma and oil majors had driven much of IT adoption in Vadodara, as they happen to be big users of IT. But much of this equipment is either sourced directly from the computer vendors, for instance, ONGC extensively uses Silicon Graphic machines, thus the local channel community is not really benefited. Of course the servicing and the peripherals industry is flourishing in the city.

Many companies are now keen to exploit the vast talent pool that is available in the city. In a recent report released by CII, “Vadodara: Knowledge City”, stated that the city is attracting a large number of investors to create infrastructure for IT and related companies. “Vadodara has a great potential to develop as an IT hub on account of its large English-speaking population and low cost of living. There are at least three IT parks coming up in Vadodara district. We are also considering to offer land of Gujarat Communications & Electronics and another 17 acre site of defunct Priyalakshmi Mill in the heart of the city,” said Raj Kumar, secretary, department of science and technology of government of Gujarat and MD of Gujarat Informatics. According to him, large presence of IT parks and big banners of IT industry would be visible in the next couple of years in the city.

While L&T plans to come up with an IT zone near Vadodara, many more IT parks are also in the offing, in fact Nipium Infotech is planning IT park in association with the Singapore government at the cost of around Rs. 500 crore and is waiting for an approval. There have also been reports that HCL intend to set up operation around the city. Even Pitroda’s C-SAM has a development center in Vadodara.

“Vadodara is fast emerging as a favored destination for companies looking for cost-effective operations and trained manpower. Vadodara might now have highly skilled people available as of now, but that is bound to change as more and more firms set up operations here,” said Yogesh Thakkar, CEO, Rhythm Electronics – one of the leading channel players in the city.
Over a dozen new IT and BPO companies have started operations in the city over the last many years. MNCs are also entering the city through the M&A route, CSC recently acquired local player CSC that provides high-end BPO services from Vadodara center. There is also InteQ IT Services India that operates out of Vadodara and provides RIM services to US clients.

Much of the companies that operate out of Vadodara are 300-500 seaters. Though the biggies are coming in the small way, as of now, TCS has a 200-seater facility in Vadodara, set up especially to work with Gujarat State Electricity Board. “There are a few call centers in city like Fortune Infonet and others. Slowly and steadily Vadodara is catching up as an investment destination. When Dewang Mehta was alive he used to push the city. Sadly after his death, there was not much action,” says Nilesh Kuvadia, CEO, IT Consultancy Group. Kuvadia is also a member of the Baroda Information Technology Group (BITG). BITG currently has around 350 members and has been active for the last 9 years.

A computer savvy city
Like any other smaller city, the biggest asset of Vadodara is the workforce. Thanks to the numerous colleges like Sardar Patel University, Sigma Institute of Management Studies, Parul Institute of Engineering and Technology, and of course MS University, ensures there is a steady stream of well-educated youth flowing into the marketplace year-after-year. “Vadodara’s biggest strength is its well-educated talent pool from the only English-medium University of the state and growing private sector educational institutions. The quality of education is as good as those available at high-tech institutes like IIT Roorkee,” says Indranil Deb, manager (Program), ONGC.

Deb also vouches for the high computer literacy in Vadodara. “The people are very computer savvy and you can find even small-time chemists doing their accountancy on computers. Even in the late 80s, there were students here that were taking up courses on C and C++. The product of Vadodara is as good as any other that you will find in the country,” he states. Currently ONGC operates a high-end Virtual Reality center in Vadodara.

Naresh Kumar Garg, senior scientific officer, BARC, also underscores the same point. “To be honest, over the last many years a lot of amazing work has been done on the e-governance front, especially the computerization of land records. This has led to high computer literacy. Personally, the way Vadodara Municipal Corporation has also gone in for automation is a feat by itself,” he says.

“This city is a heaven for outsiders as the culture is very cosmopolitan, yet not really commercial. I have been in this city for the past 19 years, and cannot think of anywhere else that I rather be,” adds Garg.

Indebted to his highness
Vadodara has a nickname, Sayaji Nagari, it is quite an apt one. Any discussion on Vadodara cannot be completed without mentioning the name of former ruler of the state, Maharaja Sayajirao Gaekwad III, who ruled the state from 1881 to 1939. The visionary ruler is responsible for all that Vadodara has to offer, even today. He was a reformist, and on assuming the power, made primary education free and compulsory, banned child marriages, encouraged fine arts, among other achievements. Maharaja founded Bank of Baroda in 1908 and also University of Vadodara, aptly named after him. To get a glimpse of the amazing personality, visit the Maharaja Fatesingh Musuem, located in the Laxmi Vilas Palace Compound and houses one of the best personal art collection in all of India.

“The Maharaja was so ahead of his time that he had created a man-made reservoir in Ajwa that would take care of the water needs of the city for the next 2 centuries and it is very much doing so,” says Deb.

Situated some 40 minutes (air) away from Mumbai. Vadodara is ideal location for back-office and BPO work. As of now, the real estate prices have not peaked and this makes the city an ideal candidate for investment. The only possible drawback is probably prohibition policy. Thus, after a hard day, you cannot really chill out with a beer or two. Other than that, it is city that really showcases all that is good in a small town-city of India, be it culture or its warm people. It is quite hard not to be in love with Vadodara, as it is unique in so many ways and therein lies it biggest charm. The city does not really need celebrities to associate with it, as every citizen is a ardent supporter.

***

To say that every Indian is obsessed with the Rupee would really be of no surprise, considering our very material existence depends on the currency that has the Mahatma printed on it. But, of late, there has been surge in the obsession and it is directly proportional to the surge of the Rupee versus the US Dollar. Thus, the rise of the Rupee is a tale that everyone is talking of; right from the mantriji to our business magnates. And yet, something seems to be lost in translation. If you happen to track the Dollar (even for the past few days), it has been falling against all currencies quite like the London Bridge (remember the rhyme, London bridge is falling down…). Thus to be quite honest, it certainly is not strengthening of the Rupee but rather the weakening of the Dollar.

Nonetheless, the impact is quite evident on the Indian IT industry, that has been quite dependent on exports from the US. Personally, I feel it is a time for reassessment, a time to get back to the basics and start working from there. Indian IT industry has never really considered the domestic market as a viable proposition. If there were ever a right time, it is right now. And that is what I intend to say in my latest story published in the Dataquest magazine, in which not only did I try to assess the impact on the IT industry, I proposed some solutions (nothing out of the world believe me). Read on.

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The Brighter Side of a Stronger Rupee

There is no denying that a stronger rupee has eaten into the profits of the export services firms in India, sometimes forcing them to take drastic measures. But a strong local currency has a positive impact. Not only can it make imports cheaper, it can force the export-oriented firms to look more seriously at the local market. By all means, the latter has started happening. Will the strong rupee be a blessing for Indias domestic market?

On a balmy May night in 1991, a Swissair Airbus took off from the IGI Airport, New Delhi. It was headed for Zurich, Switzerland. As some of the passengers figured out, there was something special in the cargo. At the airport, there was much heightened security around the cargo-hold and officials seemed unusually nervous and edgy. In its belly, the Swiss aircraft was hauling 20 tonnes of gold from the Indian governments treasury, to be sold in the international marketplace. A news item in the NYT stated that the gold was sold for around $234 mn, priced at $11.7 mn a ton.

Some days later, another 46 tonnes of gold was carted away to the Bank of England, London. But this time, the consignment was drawn from the Reserve Bank of India (RBI) coffers and pledged in return for loans from the Bank of England, and Japan. The hush-hush transaction had been necessitated due to the terrible state of the Indian economy at that point in time.

The situation so was bad that the near-zilch forex reserves were just enough to cover a few weeks of imports, and the country was on the verge of defaulting on loan repayments. At that point, the finance minister, Dr Manmohan Singh could only wring his hands as the gold was moved out of India.

Naturally, as soon as the news leaked, there was uproar throughout India. Gold is more than a precious metal for Indians, it is a sign of prosperity and wellness. People decried the governments decision; many termed it as a sell-out, while others equated it to mortgaging national honor. Indeed, India’s credibility had touched rock bottom, lenders were not willing to loan without gold as a mortgage (that too insisting on moving it physically). At that time, the exchange rate was some 20 rupees to a US dollar.

This ripple (gold reserves transfer), in time, converged into a wave that changed the course of the Indian economy. Under pressure from the International Monetary Fund (IMF), India had to liberalize the economy and open up the markets. The rest, as they say, is history.

Over 16 years have passed since that gold was sold, and so much has changed. Made in India is a tag used with pride and Indian businesses are creating news all over be it steel or tea. Even Indian forex reserves, which had dipped to less than $1 bn in 1991, have crossed the $200 bn mark. With GDP growing at around 9% for the past few years, and massive inflow of FDI, the picture is quite rosy.

An indicator of the same is the Indian Rupee or INR that is appreciating. Today, it stands at around 40 INR to a USD. Yet, not everyone seems to be celebrating. The reasons are not hard to miss.

Little Miss Muffet
For the past decade or so, the IT Industry has been the most estimable sector of the economy. Growing at over 20% per year, the industry, according to Nasscom figures, is set to touch $60 bn by 2010. Much of this growth can be attributed to cost arbitrage. The idea is fairly simple: earn in USD, pay in INR and sing tralalala on your way to the bank. Due to the big differential in value terms (it was 48 INR per USD in 2002), Indian companies were able to sell services much cheaply. And foreigners woke up to outsourcing.

Even so, there was a catch, as Indian companies were riding on a cost plank, the billings were competitive and always under pressure. Meanwhile, due to a spurt on the domestic shore, the costs (most importantly, manpower) were always on the incline. Quite like miss Muffet (the IT players) had been sitting on a tuffet, eating curd and whey, before the spider (price rise) came and sat beside her.

Since 2002, the INR started appreciating, and IT companies were caught in a quandary. With every rise in exchange rate, the margins (almost anorexic) were furthered squeezed. Yet, the companies weathered the situation with fair stoicism. The fact that the government was proselytizing rapid growth and thus giving away tax sops, could have played on the minds. Anyways, there was little noise about the gradual increase in the INR rates.

As the INR continued on its northward trek, some noises were made, now and then, here and there. Steadily, the squeaks became a chorus, and much concern was expressed at the way the currency tide was turning. But when the trek turned to a sprint, the IT industry was wrought with fear. A pall of despondency descended on the sunshine sector, everyone discussed the issue with aggravated disbelief. Doomsday scenarios were plotted. And everyone spoke about how the rise would be the toughest challenge faced by the industry, an uphill battle for survival. Experts proclaimed that the rise of the INR was impacting the competitiveness of Indian players and would lead to companies favoring other locations.

Yet, what everyone seemed to miss was that the rise of the INR was a natural economic phenomenon and, to be correct, was not really a steep rise. It was more a case of USD depreciation (read the box Rupee Up or Dollar Down?).

Time to go Desi
If there was ever a time to sing the Indian song, it is now. Over the last many decades the IT players have been looking beyond India for growth, nothing bad in that. But in these years, the domestic pie has been increasing steadily. Consider this, according to the DQ20 figures, the domestic IT market has touched Rs 73,315 crore (growing by 27.2%) as IT spreads to B and C tier towns. A good indicator of this has been the fact that during the past year, over 11 lakh notebooks and 49 lakh desktops have been sold.

MR Venkatesh, a CA based in Chennai, and author of many papers on the various economic issues including exchange rate, thumps the table enthusiastically. “I have always believed that there is huge potential in the domestic market, after all, the population of India is greater than the combined population of the US and Europe. It is simply a no-brainer. Now that the INR has strengthened, it makes an even more compelling case,” he says. He talks of how the Indian Railways has made use of technology in a big way not only to increase its efficiency but also to grow revenues. “Like railways, there are many more IT success stories waiting to happen,” he adds.

The process might have already started. Till date, while TCS, Infosys, Wipro, and others were blazing trails overseas, the IBMs and the HPs became huge players on the domestic scene. Thus every big outsourcing deal like TCSs ABN Amro, was matched by IBMs big domestic deals like Bharti and Idea. The MNCs were marching away with the domestic cherries most of the time. Not anymore.

There seems to be a change in the mood now, as players are focusing on the market with renewed zeal. A good illustration would be the latest TCS deal with BSNL, worth over Rs 570 crore. “If players believe that the rupee will continue to appreciate and appreciation is not going to be reversed soon, it may provide an additional incentive to develop the domestic market,” says Alok Ray, former professor of economics, IIM Calcutta, and visiting professor of economics, University of Pittsburgh, USA.

Even the BPO industry is looking inward. Take the case of Intelenet Global, while its international revenues declined due to the tanking of the USD, it has become a power to reckon with on the domestic BPO front. Intelenets acquisition of Sparsh (a domestic BPO) is paying high-dividends as its domestic business grew handsomely and currently accounts for 23% of the total revenues. Thus the dip in the overseas is being offset by the rise in the domestic. So, are other BPO companies like Sitel India turning inward. “The myth that domestic clients do not pay well has been shattered. In fact, domestic companies are ready to pay provided you have a good business case. The demands of the domestic industry are quite like overseas ones,” says Safir Adeni, CEO, Sitel India.

There is more to the desi story though. The process will lead to democritization of IT. The benefits from the IT Industry were transferred to a limited audience, usually in the metros and fairly well-heeled. The common man was largely untouched by the miracle. But as when the markets expand, the growth is bound to be more inclusive. The telecom sector is a brilliant case study. In a few years time, India has turned into a Mecca for all mobile companies and this transition has benefited all. Similarly, as the laptops and routers and servers reach the Indian hinterland, it will create a domino effect.

The Good, the Bad and Imports
Now then, the hardware sector should be on a roll. As India is a net importer in terms of hardware, be it chips or LCDs, the industry benefits the most from the current scenario. Considering that INR has appreciated by over 7% in the past few months, one expects to see big banners proclaiming never-before prices hanging on the roadside. But that has not really been the case.

Indeed, hardware prices have been dropping, but not dropping as suddenly as they should. The suddenness of it all is missing. Could it be that the hardware manufacturers, the smart cookies are pocketing the margins that they are deriving from the rise. Disagrees Vinnie Mehta, executive director, Manufacturers Association for Information Technology (MAIT). “The advantage gained from a stronger INR versus the USD has more or less been nullified by the rise of the Japanese Yen and the Chinese RNB. Since much of the hardware that comes to India is imported from these two destinations, there has really not been that much advantage to talk of,” he says.

Meanwhile, all that Raj Saraf, chairman and MD, Zenith is willing to say is that “the benefits have been passed on to the customer.” Ask why and how much, Saraf is not willing to go into the nitty-gritty. The silence from the hardware industry is a wee-bit surprising. After all, one mans poison is another’s honey. The cheer on the hardware side should have mitigated the gloom on the software side. But that has not been the case so far.

Also, could the INR appreciation impact the evolving manufacturing story? If it is cheaper to import, why manufacture? “I dont think so,” says Mehta, adding, “the attractiveness of the Indian market would not be impacted simply because of its sheer size. Manufacturers are coming to India to tap the domestic market and not due to cost arbitrage or other things.” That is indeed the moot point: the domestic market. The hardware sectors focus (by choice or force) on the domestic industry seems to be paying off finally.

Survival of the Fittest
All said and done, the exporting software (read services) needs to reassess and realign the goals. They need to gear up for the changed scenario. As TR Madan Mohan, director, Consulting, ICT Practice, Frost & Sullivan puts it. “Margins of export intensive firms such as BPOs have been adversely affected in the last two quarters. A 1% increase in INR against the USD can impact 70-75 base points for KPO/BPOs and about 35-40 base points on margins of IT companies,” he says.

Volatility is the real devil, points out Ameet Nivsarkar, VP, Nasscom. “While one can learn to live with a gradual rise of currency, it is the sudden one (like the one witnessed in the past few months) that is hard to digest,” he says.

S Gopalikrishnan, CEO, Infosys, echoes the same sentiment. “Rupee appreciated 7% during the first quarter and 9% during the year. It takes time to absorb such a change and is a challenge for the company,” he said. According to him, the company plans to raise its billing rates by 3-4% for new contracts and by 2-3% on renewal of the existing contracts.

But that could be tough, as says Sudin Apte, country head & senior analyst, India Operations, Forrester Research: “First, the margins of Indian IT vendors are affected by INRs rise against the USD. In the quarter ending June 2007, the rupee appreciated almost 7% and this has hit their profitability. In addition, Indian IT exporters claim that their revenues have gone down, while costs have risen. Our research based on (IT Vendors) client interactions indicates that some of the Indian IT-ITeS companies are trying to raise prices to cope with the situation and are asking their North American clients to share some of the risks. Moreover, the bigger Indian vendors are exploring a pricing model with some of their clients that would maintain a base-level convertibility and assured returns in dollars. But we don t see a very positive reaction to this by their clients,” he states candidly.

Apte has a solution for the industry as well. “To negate the impact I advise Indian IT companies to look beyond just pushing up the utilization because there are limits as to what extent firms can raise utilization. Raising it a few points further may not be the solution as the results are limited. So these firms have to take other initiatives such as enhance efforts for non-linearity; further flatten the delivery pyramid by using process IP and automation of several managerial tasks (that are manual at present); and boost front-end sophistication, for instance, firms like TCS and Infosys have made reasonable strides in this regard, most other firms need to upgrade skills related to sales, relationship management, account management, negotiations, standardization of sales process among others,” he says.

Also, as the INR is more or less stable in comparison to other currencies, it makes sense to look for greener shores namely in the Europe, and other places. “It is always a good long-term policy to diversify your markets for reducing risks, irrespective of short-term fluctuations in exchange rates. It should be easier, given our past successes and the good brand image and reputation that some Indian IT companies have already built up,” says Ray.

Don’t forget that with INR rise acquisitions become cheaper as well. As Indian companies look to spread far and wide, a strong currency will surely be of help and servicing the loans taken earlier would be easier.

Big Squeeze on Small Vendors
While the big players have been able to tide over the crisis, it is the small ones that have been feeling the heat. Caught between the devil and the deep sea, i.e, lesser revenue and high costs (as they don’t have the economies of scale), IT SMEs do not seem that sure anymore. According to experts, they need to do the same things like their bigger cousins, namely increase productivity and diversify, except they have a lesser margin for error.

“Apart from these initiatives, for smaller vendors, the time has arrived to identify their strengths and focus on just one or two lines where they can provide services instead of spreading too thin,” adds Apte.

Nivsarkar also talks about the numerous initiatives taken by Nasscom to help the SMEs diversify. “We are actively promoting new locations for our SMEs and running quite a few country programs,” he says.

It is deja vu for the Indian IT industry. When the Al Qaeda had rocked the world in September 11, 2001, there were talks of a US meltdown and the resultant impact on the world economy. Then too, the Indian IT Industry was under the scanner due to its exposure to the US economy. But nothing of that happened, on the contrary, Indian companies grew and benefited.

The INR appreciation (the minor that is there) is a sign of times to come; an indication of India’s growing economic stature. In 1991, we had to pledge our gold to foreign banks and take loans from the IMF. Just 12 years later, in 2003, India became a lender to the IMF, contributing some 180 mn to a reserve fund used to bail out countries in a financial mess. India also wrote off 12.5 mn that seven heavily indebted poor countries Mozambique, Tanzania, Zambia, Guyana, Nicaragua, Ghana and Uganda owed to us! Prime minister Manmohan Singh must be surely rubbing his hands in glee now.

In light of such positive changes, it is but natural that currency will appreciate and should. There has been much speculation of another fall in USD due to the messy situation of the US economy, a mammoth trade deficit and rising unemployment rates. But no one is ready to stick his neck out to guess when and by how much will the hallowed USD fall. “When and how is a million dollar question with a billion dollar implications,” says Venkatesh. IT players just need to stop cribbing and realign their focus. The mantra is simple; go desi and go now!

As far as the currency conundrum is concerned, the only advice that one can give to the industry captains, is the one governess Miss Prism gave to Cecily in Oscar Wilde’s ‘Importance of Being Earnest’ written in 1890s. Albeit, with a minor change.

“That would be delightful. Cecily, you will read your Political Economy in my absence. The chapter on the Fall (read RISE) of the Rupee you may omit. It is somewhat too sensational.”

That’s the story of the “rise of the rupee”. Somewhat too sensational. The reality may be different.

Shashwat DC
shashwatc@cybermedia.co.in

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Rupee Up or Dollar Down?

Amidst the reports and panic about the “rising rupee”, the real picture may have got fuzzy. While it is true that the INR has appreciated against the dollar to record levels over the past one year, and now hovers at INR 40 to a USD, the fact is: so have most other currencies, including the Euro, gained against the US dollar. Little googling reveals something not so startling. The INR may have gone up in comparison to the USD, but so have most others. Thus, effectively, the INR has maintained its level against most other currencies (that have let market forces determine the rate). Hence, the real issue is not that the INR is appreciating, but that the USD is depreciating. This minor wordplay betrays the bigger implications.

SaysVenkatesh. “Quite many have been barking up the wrong tree because almost all world currencies, barring a few like Yen, have appreciated in comparison to the USD. It has been a global phenomenon. The rise of the INR is an economic phenomenon; as the economy becomes stronger so does the currency. But the current spurt should be referred to as the dollar depreciation rather than merely a rupee appreciation. In this light, I do not really think Indian exporters have much to complain about,” he says.

Not quite says Nivsarkar. “While the USD has indeed depreciated on a global scale, the INR has also appreciated quite reasonably due to the huge inflow of foreign investments into the Indian economy. Thus, it is a blend of both the factors,” he states.

So lets rake up some dust on this matter. In 2002, according to data available from RBI, 1 USD was equal to 48.59 INR; 1 GBP was equal to 73 INR and 1 euro was equal to 45.92 INR. As of today (according to XE.com), 1 USD is equal to 40.35 INR; 1 GBP is equal to 81.91 INR and 1 euro is equal to 56.11 INR. Thus, over the last 5 years, INR depreciated against the euro and the UK pound, while going up against the USD.

Again, the reasons are not hard to fathom. Over the last few years, the US economy has been going through a meltdown. Economic growth has been tardy and has been beset with crises, like the latest meltdown in the sub-prime lending market. In fact, according to a report published on BBC today, “The USD has fallen to a record low against the euro as investors bet that the Federal Reserve will cut interest rates to help the economy.

By late afternoon in Europe, it took $1.3901 to buy a euro, passing the last record of $1.3852 set on 24 July.” QED, it is the USD that is going down and not the INR going up. Hence, the glass might seem half empty, but is half full as well. The USD has dropped against most currencies. While that may affect the cost savings accrued to Ameriocan companies, there is little change in the attractiveness of any specific offshore location

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Attrition Blues!

It is Catch 22 for the IT giants in India. On one hand, the margins are being squeezed, on the other, they need to pay more to retain the workforce. There have been signs that at least the big companies are resisting wage hikes, namely, TCS, Wipro, and Infosys. In fact, in the recently announced Salary Survey conducted by Dataquest and IDC, Infosys ranked at #12 and TCS at #13, in the top paymasters in 2007.

Result, rising attrition. According to a report published by PTI, the big four, namely, TCS, Infosys, Wipro and Satyam have seen an exodus of about 10,000 people in the first quarter. Though these firms have been rapidly hiring, they collectively hired more than 25,000 employees in the April-June period, the net addition was just about 16,300taking their total headcount to 2,85,357 employees.

Most of these employees seem to be leaving due to the lure of greenback, thus joining MNCs and smaller firms that are ready to pay higher. If there is any further strengthening of the rupee, great salary hikes (average salary growth of 11% and average salary hike 19%, according to DQ-IDC Survey) might be a thing of the past. Already there has been talk of how the wage hikes are becoming unrealistic, and currently forms one of the biggest components of the operational costs. The good news is that salary satisfaction is not really linked to salary hikes and much of this attrition can be controlled by imaginative HR strategies. A lot of small players seem to have learnt that and are finding newer ways of retaining their employees, rather than just trying to pay them more.

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Call it the revenge of the native!

The chart shows the movement of stock/ADR prices of selected IT Services firms. Is offshoring falling out of favour with the American investors in the wake of a weakening dollar?
After enjoying immense favor with the investors, thanks to their impressive growth rates and margins for more than four years, the leading offshore service providers saw their stocks plummeting in the last six months, thanks to a weakening dollar that gave rise to fears about the sustainability of offshoring economics.

Between March (23rd) and September (7th), the price of Infosys ADR dropped 9.6% while that of fellow Bangalore company, Wipro, dropped 15.7%. But the most drastic fall was seen by the stock of “growth machine,” Cognizant which plunged by a whopping 23.5%.

In the same time period, the traditional North American outsourcing firms like IBM, Accenture and CSC saw their stock prices going up by 21.6%, 9.9% and 5.6% respectively.

The Indian firms like Infosys, Wipro and TCS (not listed in the US) have admitted that the weakening dollar has hit their margins.

Meanwhile, the North American firms have built significant India delivery capability and are fast mastering the art of managing talent in a highly competitive labor market like India, as revealed by a Dataquest-IDC survey. This has leveled the offshoring battlefield further, and that has certainly not helped the cause of investor confidence in Indian firms.

Getting to interact with Prof. Brandenburg was really a high-point for me. It was not only because he is renowned as the ‘father of the MP3’ (which he disputes), but also for the person he is, a true academic genius. I really admire the values that Prof. Brandenburg stands for. A few decades back, the fledgling IT industry was dominated by people who were inventors, people like Gary Kildall, Gene Amdahl, Seymour Kray, Bob Kahn, Vincent Cerf, and so many others. Today, it is mainly dominated by business magnates (Yes, there is Steve Jobs and one could argue even Bill Gates, still).

In those days, inventors tinkered with technology not for the money that could be made out of it, but how it would aid people in their everyday lives. Prof. Brandenburg belongs to that genre, he was instrumental in inventing MP3, and once he had done so, he returned to Fraunhofer Institute to aid other people. When during the conversation, I talked about money and compared him with Sir. Tim Berners-Lee, he baulked and said that he had made money (thanks to a German legislation) from his invention and he seemed quite content with it. His simplicity is truly touching.

The whole interaction was published in Dataquest: (http://dqindia.ciol.com/content/q&a/2007/107091702.asp)

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‘For the next decade, MP3 will exist and be alive’

Music and mathematics make the unlikeliest of pairs. Arguments abound about how the two are interrelated, and how mathematics can be used to understand, evaluate and analyze music. Some even passionately debate how at the core of a composition is an algebraic equation. Still, the correlation between the genius of Fibonacci and the brilliance of Beethoven is a little hard to swallow.

Notwithstanding the debate, the contribution of mathematician Karlheinz Brandenburg to the mellifluous universe of music is incontestable. The audio engineer, by using simple algorithm, unshackled music in a way it was barely conceivable.

Brandenburg (and his team of inventors) invented the Motion Picture Experts Group (MPEG) Audio Layer 3, more popularly known by the file extension MP3, at the Fraunhofer Institute in Germany in the early nineties. It was on July 7, 1994, that the Fraunhofer Society released the first software MP3 encoder called l3enc. And it completely changed the way we looked at and heard music. All of sudden, music had turned portable; it could be played anywhere and was more or less freely available. Over the next few years, MP3 completely lorded over all the music formats that existed in the past and the present.

But instead of basking in the glory of his invention, or raking in money by the millions, Brandenburg decided to return to Fraunhofer as the director of the Institute for Digital Media Technology (IDMT) in the picturesque town of Ilmenau, Germany. He now enjoys simple pleasures of life like listening to music on his iPod Nano, swimming or trekking.

Widely regarded as the father of MP3, Brandenburg is currently working on futuristic technologies in the same domain, like a program that automatically discerns and unearths music based on the type of music that we listen to from the Internet. In an interview with Dataquest, Brandenburg talks about his invention and himself. Excerpts.

It has been around thirteen years since the MP3 format was publicly launched, and yet it continues to be the most popular format for music. In this rapidly changing world isnt that a sort an anomaly?
I think MP3 is a common ground for compressed music; it is one format that is supported by all kinds of equipment and can be decoded and listened to anytime, anywhere. People like this continuity; they dont want to change the format of their music every other year. It is due to this universitality that MP3 continues to be popular.

MP3 is the second most popular search item on the Internet, and, ironically, it wasnt even invented keeping the computer in mind. Did you have an inkling of how popular it would be?
Yes and no. One always has dreams, when I did my PHD work, I was dreaming that my work would be used by millions of people. But I dont think I or anybody else in the group had a feeling of how large our work would really be.

How do you feel about the marriage between Internet and MP3?
In was in late 1994 and early 1995, that we at Fraunhofer had an internal discussion about the future potential of the Internet. We knew that we had a window of opportunity to make MP3 the Internet audio standard. Quite shortly after we released the shareware encoder and decoder software, we saw the first people using MP3 on the Internetthat was in 1995.

How does it feel to be referred to as the father of MP3?
I am certainly not the father of MP3. I know who else contributed in the development of MP3, whose shoulders I stand on and who else worked on the topic. Hence, I never refer to myself as the father of MP3, I do know that I contributed significantly to the development of the standard, so feel very connected to the MP3, thats it.

Your views on MP3 and P2P servicesdo you not think that like any other commodity, users have a right to share and trade music?
I always had the opinion that IP should be treated with respect. A musician, and others in the creative process, should benefit from their creation, so I didnt like the idea of Napster. That does not mean I endorse every move and idea of the music industry. I do think, there should be a chance for musicians to make money from their creation, while others continue to enjoy music.

The music industry seems to hate MP3, do you think their fears are justified?
Justified to an extent, but highly exaggerated. In fact, this exaggeration became a problem by itself. They feared MP3 and would not embrace it, and it took a long time for legal services to come up. Internet provided lots of opportunities for lesser-known musicians. It is important that websites like Myspace and others provide a way for these artists to showcase their talents. The music industry did not capitalize on this opportunity.

What do you think of DRM? Should there be some sort of protection for MP3 files?
MP3 by itself is a format that plays everywhere and a blank MP3 does not have any sort of protection. Though I do understand that people do want some sort of protection. But having multiple proprietary systems that do not work with each other complicated things. It was a bad idea. DRM should work in a way that as a customer you should not notice it. If you are a legal customer, you should do whatever you are entitled to with your music without getting into any difficulties. For instance, if your computer breaks down or you have to replace files from another computer, or if you have different brands of devices, so on. All the current problems we have with DRM is bad in terms of usability.

Ideally, DRM should not be visible at all to the consumers and as long as we dont have that, it is better to have no DRM (the current multiple format one) at all.

What do you think of the numerous patent disputes that have arisen over the use of MP3?
Some of these issues have been very bad for the industry and the population, as commercial interests have driven them. As nowadays, everybody tries to get in and make quick money. Patents themselves are a good idea. I cant comment on any specific legal dispute. But it is clear that a lot of things have happened that make us all worried as to what the future will be.

There is often the discussion about your own personal gains, you could have benefited a lot more. Does that thought ever occur to you?
Thats a frequently asked question. But then, I have indeed benefited commercially from MP3. I am holding one patent that is about to run out, and am on a number of patents that Fraunhofer Institute holds. In Germany, there is a law that the inventor gets a fraction of the revenues generated from royalties so not only me but also a lot of others get a share from the royalties, as well. There are a lot of patents and lot of people who contributed to MP3, so it is a win-win situation.

What do you think of the current generation of MP3 players, do you feel they are good enough?
There is always more to come. What I think we will see is more of connectivity, like it will get easier to connect to my computer to get music. What I would like to see, and we are working currently at Ilmenau, is an automatic play list generator. Even when companies have done a lot in improving the user interface, I still have to search for what I need to listen to next. The MP3 player or the iPod could help with that selection. Otherwise, I really like the current breed of MP3 players.

What do you think of the iPod?
It is quite good. I own a couple of iPods and other MP3 players as well.

How many MP3 players do you own?
I must have bought close to 15-20 MP3 players over the years. At the moment, I use my 8 GB Nano, but I recently bought Samsung, and have several Creative Labs players.

What is the future of MP3?
On one hand you have the AAC format. We worked quite a bit on AAC as well. We all at Fraunhofer are proud of what became of AAC. My colleagues are also working at MPEG surround and MP3 surround. I think for audio in general, we will see a big step forward beyond the current surround systems. The current systems are based on ideas that have been around for over two decades. We are now working on it and calling it Ozono, there you can have immersive audio, you feel like you are somewhere out with much better sound quality. It gives you a much better idea of surrounding, of being somewhere else versus 2-channel or 5-channel audio.

You have also been involved with a program called Soundslike, what is the progress on it?
Work on Soundslike has been continuing. The original Soundslike did not work that well, the newer version discerns music patterns and helps with the selection of music. If I understand right, we can see the first products incorporating Soundslike to be out this year. It would be some PC software product.

A lot of people have argued against the idea, saying that an algorithm can hardly choose music?
The debate is quite interesting. True it is difficult for machines to understand all the different nuances and finally decide for me whether I like the music or not, and generate a play list. There are a lot of Web 2.0 technologies involved in this, like sharing play lists, doing the metadata, synthesizing the style, etc. In the future, we will have a combination of those, the automatic system will help us in a limited way. I heard reports that on testing, people enjoyed it a lot. It is intuitive, wont be cent percent right. But it will work enough so that it can help in the selection process.

What other projects are you involved with?
I am now the head of the institute in Ilmenau and am responsible for all the activities here. In many ways life has come full circle; two decades back I was working on audio compression, now my job is to look around for what could be interesting, and work out the money and people issues.

MP3 is not a very fancy name, did the team think of any other name at that time?We just needed a 3-letter extension, because that was the time of the Windows 3.1 OS and the file extension could not be more than three letters. Others had in fact used the term MP2 for layer 2 music. If I recall correctly it was the Internet Underground Music Archive that already had music in Layer 2 format. So we had an internal discussion on what extension to take and then it was just a file extension. Little did we realize that this file extension would be used as a generic name for the whole technology. It wasnt a conscious decision by us, we always referred to the technology as MPEG Layer 3, and only later on started to use the term MP3, after the term had gained popularity.

What do you feel about MP3 and open source?
MP3 on one hand is a patented technology but its source was available for free for a long time. We do support the idea of open source and feel that it is a good idea. But that does not make MP3 free in terms of no strings attached because it still is patented technology. Of course, I did watch what was happening with Ogg Vorbis and so on, and, overall, I think for the whole of the software industry and the whole of the Internet culture it is a good thing if we have both. We need a world where people cooperate without commercial interests. I think it is a very nice model, but things would not work if it were the only model. We need a free software and free technology model as well as companies investing money and resources to do work, apply for licenses and patents and work on proprietary technology. In the end, if both systems co-exist it will be of advantage to all.

It has been 13 years, how much longer will it stay with us?
MP3 will stay the common denominator; it will continue to be the format for a lot of different equipment for the next ten years at least. What will happen after that is hard to guess. Over the past years, more bandwidth and more storage capacity has been available to us, so you could have newer formats for multi-channel sound. It will be very interesting. Will it be MP3 Surround for portable devices or will we go for different format altogether, is anybodys guess. But, for the next 10 years while there will be new systems, MP3 will co-exist and be alive.

Shashwat DC
shashwatc@cybermedia.co.in

One of the biggest faced by governments across the globe battling terror is money laundering. How to stop the funding and transfer of funds to terror outfits? Post 9/11, a lot of measures have been put into force to curb the transactions. All these actions are labelled as Anti-Money Laundering or AML. Recently there were reports of how sleeping cells in Germany and Canada were recieving money through Internet. In fact, Internet has become a favored means for surreptiously sending across money by terrorist outfits.

AML is a war, rather an ongoing war. And the biggest weapon that the governments have with them is technology. By using IT extensively, money laundering can be curbed to a great extent. Indian authorities have also woken up to AML and are trying to put in place the strategy, it is an uphill task. I had authored a story on the issue, and it was published in CIOL. Thought, I’d share the same….
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Battling terror by choking finance

Several countries are in the process of implementing anti money laundering measures to fight off the evil of terrorism. Where does India stand? An analysis.

One hot summer morning in June, 2000, Mohammed Atta and his close associate Marwan al-Shehhi sauntered into the Florida SunTrust Bank and opened a joint account with few and forged documents. Just a few months ago, Atta and al-Shehhi had opened accounts in Citibank and HSBC’s Dubai branches, respectively. Over the summer, approximately $109,440 was wired into their account from their U.A.E. bank accounts. According to FBI, the deposits to their bank account totaled $303,481.63 in over a year. This money was used for airline tickets, flying lessons, living expenses, etc. The whole operation culminated on the morning of September 11, 2001, when Atta crashed the American Airlines Flight 11 Boeing 767-223ER aircraft in the North Tower of the World Trade Center. And the world woke up to terrorism, and the evil known as money laundering.

Post 9/11, U.S. came down stringently on money laundering, trying to eradicate the financial sources was an important objective of America’s war on terror. To that end, numerous legislations were promulgated; in the U.S. it was the Patriot Act, while the European Commission set up the Financial Action Task Force (FATF) recommendations and the Wolfsberg Principles on Private Banking. “The FATF has a set of forty recommendations which are updated on a consistent basis to keep pace with money laundering techniques. The FATF membership now includes 31+ countries with some countries from the Gulf Council as permanent members,” says Hanuman Tripathi, MD, Infrasoft.

It is certainly not an easy task, as the criminals try and stay one step ahead of the legal dragnet. And technology is on their side. With the boom in Internet banking and online transactions, fraudulent funds can be transferred at click of the mouse. Premjit Dass, associate director (Advisory), Forensic Services, KPMG, estimates that close to $590 billion to $1.5 trillion are laundered annually, “When viewed in the context of the global GDP, it is a very large amount,” he points out.

But the authorities are trying to catch up, with the use of technology, especially software. Major banks across the developed countries have put in to place anti money laundering (AML) processes; these could range from appointing an officer to installation of an enterprise wide software solution.

In the Indian context, money laundering has always been a big problem. Hawala and black money economy are the two big issues that have plagued the various regulatory authorities over the years. Black economy according to estimates was around 40% of GDP in 1995-96, (Source: The Black Economy in India, author Arun Kumar). “Few can realistically estimate the dramatic amount of wealth locked out of the Indian economy and the myriad means through which is seeks legitimacy,” says Suheim Sheikh, managing director, SDG & head (Capital Market & Anti Money Laundering Solutions), 3i Infotech.

Ironically, money laundering has never been considered a serious issue in India, it is often deemed as a legitimate mean to save money from the tax department. All that seems to be changing now, with the Reserve Bank of India (RBI) and the government coming down heavily on money launderers and trying to get to the very roots of these activities.

The Prevention of Money Laundering Act 2002 has come into effect from July 1, 2005. The RBI has issued KYC (know your consumer) guidelines to banks that were needed to implement by December 31, 2005, but many Indian banks are still in the process of implementing these guidelines. “SEBI (Securities and Exchange Bureau of India) has also issued AML guidelines to stock brokers vide its notification ISD/CIR/RR/AML/1/06 dated January 18, 2006. A FIU or Financial Intelligence Unit has also become operational,” adds Premjit.

According to source at Indian Bank Association, the format for the KYC feedback forum is still being discussed.

To help banks and financial institutions keep track of fraudulent transactions, many IT firms have developed enterprise level AML software. “AML software is essentially a pattern recognition and behavior detection technology. It is largely comprised of a KYC and transaction monitoring modules,” says Hanuman. Simply speaking, if there are constant transactions of big amounts of money, the system will alert the bank and it could then keep a tab. Were, this system in place in 2001, the big transactions made by Atta and al-Shehhi would have alerted the authorities. The software has the ability to categorize the customer from a risk-based perspective. The bank customers are a worried lot though, as the authorities will be watching and recording every transaction.

Indian IT companies are vying to grab a chunk of the global anti money laundering that is estimated to be worth around $10 billion, whereas the Indian market is estimated to be worth around Rs. 185-220 crores. Companies like Infrasoft and SDG-3i Infotech are the leading players in the domestic space. While most of the multinational banks have or are in the process of implementing AML processes, it is the nationalized banks that seem to be dragging their feet.

There are many reasons as to why public sector banks are lacking in comparison to private ones, chiefly because they have much larger number of branches situated in far-flung areas that are difficult to connect and they also have a complex decision making process.

“The MNC banks have an additional advantage since they have had to implement their group AML standards as they fall under the purview of the regulators in the home jurisdictions that have had AML legislation and rules and regulations for a number of years,” adds Premjit. Banks like Vijaya Bank, UTI Bank, Karnataka Bank, Canara Bank have all implemented AML systems.

Indian IT firms are also making a foray into the Middle East and South Asia markets and looking at garnering a major share. Meanwhile, companies like TCS, Iflex, Infosys, etc. are also looking at tweaking their core-banking solutions, so as to be able to deliver AML features.
Finally, will the stopping the cash flow really make an impact on global terrorism?

The answer is unequivocally yes. Nothing works like money, if these terror groups are deprived of their legitimate finances, they will be unable to carry out any major attacks. It isn’t a coincidence that with the implementations of these measures, U.S. has become a lot safer and hopefully there never will be another 9/11.

Radio Frequency Identification or RFID, has been in news for past many years but yet it remains an enigma. Walmart popularized the tags and entreprises were promised manna, freedom from manual tracking, from the manufacturing floor to the warehouse. Well, the picture might not be as rosy, things have been moving on the ground. For instance, DHL has been a big case, using RFID tags to track the parcels. There is still a lot in store on that front.

Sometime back, I had interacted with Krish Mantripada, from SAP. He is evangelizing the use of RFID and is well-known for his work on the same. The interaction was published on CIOL.
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‘The application of RFID is only limited by your imagination’

During the Second World War, the Allied commanders were having a tough time identifying friend from foe when it came to aircrafts. From ground, it was virtually impossible to discern a Lutwaffe (Geman Air Force) Messerschmitt from RAF’s (Great Britain Royal Air Force) Spitfire; hence the anti-aircraft batteries were not much of help. The problem was solved by ingenious British scientists with the invention of IFF radio transponder. IFF stands for identification friend or foe, and all the Allied aircrafts were fitted with one, making it easier for ground troops to identify Lutwaffe planes using radio frequency. This was the precursor to the RFID (radio frequency identification) tags that one finds at numerous malls spread across the global.

RFID has been around for quite sometime, but has been creating news in the past few years only, all thanks to retail giant Wallmart. A few years back, Wallmart decided to automate all its back-end processes. Supply chain management or SCM was the biggest challenge, especially if you consider Wallmart vendors are based all across from Shenzen to San Francisco. Wallmart readily adopted RFID, using it to track its goods, manage inventory, business intelligence, etc. Today, it has become a poster boy for RFID deployment.

The technology is slowly making a mark on the Indian landscape as well. The early adopters were suppliers to international retail giants like Wallmart, etc. Now, Indian companies are also actively evaluating the deployment of RFID on a mass scale. SAP offers a quite a few integrated ERP solutions that are RFID enabled. Krish Mantripada, Director, Global Solution Strategy, RFID, SCM Solutions Management, SAP, spoke to Shashwat Chaturvedi from CyberMedia News at the recently held SAP Summit about the latest on RFID and his projections about the future. Excerpts.

RFID has often been associated with the retail space only, though it promises to do a lot more. Do you think the perception is changing?
Indeed it is. With increasing RFID adoption, enterprises are becoming more and more aware about the possibilities that this technology presents. Currently more than 16 different industry verticals are actively using RFID, from the manufacturing to pharmaceutical. Even, a lot of governments are employing the technology for tracking and identification; pretty soon U.S. passports will carry RFID tags. While it started off as a great retail industry tool, RFID has become much bigger now.

RFID was termed as expensive, especially due to the prohibitive costs of the tags, has that changed?
The price for the tags have come down drastically, currently they are hovering in the 10-15 cents (U.S.) per tag bracket. Sometime ago, the cost was around 50 cents. As the adoption spreads, the economies of scale will bring the cost further down. Also, there has been a lot of innovation; some companies are testing polymer-based tags instead of silicon. One firm is also testing paper-based tags with the use of conductive inks.

Why has the Indian markets been largely untouched by the RFID revolution?
It is steadily changing; a lot of enterprises are evincing keen interest in the technology. It is really surprising about how much people are aware about RFID. In fact many firms are actively pursuing pilot projects. Indian markets would no longer be untouched by the revolution.
Are you working with Indian companies on an RFID implementation?A few leading companies are currently in the early stages of implementation. Will be unable to share precise details as of now.

From which sector do these clients hail from? Is it retail only?
It is retail and manufacturing both.

Has SAP also tied up with any company in India for RFID?
We have tied up with TCS and Infosys as system integrators; there are more such partnerships in the offing.

Isn’t it strange, that while retail is the key driver behind the RFID adoption, SAP does not have a major client in this space?
But we are actively working with all the retail majors. Consider this, a majority of Wallmart and Home Depot suppliers are SAP customers. We are catering to the RFID ecosystem.
There has also been talk about the emergence of RFID viruses, your views.Yes like every other technological innovation, there will be mala fide users who will try to misuse it. Similarly, counterchecks are evolving for RFID as well, like firewalls, etc. that will detect malicious behavior and take preventive actions. As we learn more and more, so will the protective measures evolve.

Finally, what are innovative uses of RFID technology?
There are just so many, take for instance, in California, I just drive through the Expressways, while the tollbooths capture the data with the use of RFID tag and send me a monthly bill. Some hospitals are talking about tagging their patients with RFID, to ensure that correct medicine is given to the correct patient. As mentioned earlier, a few countries are talking about RFID tagged passports. Chinese authorities in Shanghai, used RFID to track slaughtered pigs. Pharma companies are trying to curb counterfeit products with the help of RFID. In fact, Nokia has come out with a few handsets that enable RFID authentication. The application of RFID is only limited by your imagination.