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Intel to Strengthen E-Biz Presence in India

Intel Corp. is set to expand its e-business operations in India, which it calls one of the biggest markets of the future and a key market for a global network of Internet data hosting centers.

Intel (INTC) plans to invest US$10 million to set up a separate division for online services and will enter into alliances with Indian Internet data hosting companies.

The Foreign Investment Promotion Board (FIPB) of India has already approved the proposal.

The new online division will mainly manage Intel's ISP program, a worldwide channel initiative that will provide ISPs with a variety of Internet-tailored products and technologies.

Atul Vijaykar, who spearheads Intel's South Asia efforts, said that India is a focus area "not merely because of its size and population, but also because of the fairly high level of computerization and growing Internet use that we see it as the most promising market in the South Asian region."

Intel will step up its presence in 100 cities across the country during the current year and focus on newer areas like networking, electronic business and enterprise solutions.

"We currently have our presence in 50 cities in India, while plans are afoot to expand our base on 50 more cities in this year" said Atul.

Intel will also continue to invest in companies which will add value to products in the areas of content development and Internet infrastructure.

The microprocessor giant is reportedly taking a 30 percent stake in a Cybermedia online venture. "Cyber Media Online Ltd (CMOL) will have equity participation from Intel," said sources at CMOL.

So far, Intel has invested in seven Indian companies: Rediff on the Net, Avigna Technologies, Eastern Software Systems, Network Solutions, Ritechoice, Silicon Automation Systems and Bharti Telespatiale.

Intel has invested US$10 million for a 20 per cent equity stake in Bharti Telespatiale Ltd, the holding company for the Bharti Group's Internet and VSAT joint ventures with British Telecom.

Sources informed that Intel is investing US$5 million in Total Shopping Network (TSN) in India, which is a direct- and Internet-based shopping network.

Intel, which has not yet gone in for any buyouts in India, has its options open on the issue that is decided by the company's corporate business development (CBS) wing.

Intel is planning to open an Internet data center in India. The sources could not shed any light on the quantum of investments to set up the center. The company has not set a firm deadline.

According to a senior company executive, the explosive growth of Internet in India is driving rapid growth in the ISP sector. Intel sees this as a strategic opportunity to build a relationship with the ISPs through a dedicated program.

Intel Corp. is now concentrating on China, India and Brazil as it sees in the three countries "the biggest potential for the promotion of IT because of the increasing demand for the Internet economy," according to Vijaykar.