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IBM Focuses On E-Business In India

The prime driver at IBM now is e-business strategy, and recently its focus has shifted to small and medium sized business, especially in a country like India, which promises loads of potential.

IBM Global Services (India) Private Ltd., which has been concentrating on the services business, will now address the problems of e-commerce in India.

The Indian arm of the multinational giant is gearing up to tackle the untapped potential in the country.

To enable the company to focus on services and e-businesses in India, senior vice president and group executive sales and distribution for IBM, William A Etherington, was in Mumbai recently.

He pointed out that while in 1995 the company considered the Internet an academic entity, in 1996 the firm realized just how popular the medium is and how popular it could be. That's when IBM launched its e-business strategy.

The company first tried the strategy on itself. It put in place a procurement systems which helped save IBM $4 billion.

"Though on the Internet any small business looks like big business, business is not restricted by any physical boundaries," officials said.

For India, IBM's focus will be on e-business, though the Indian presence of IBM, through a 50:50 joint venture with the Tata's, has still a long way to go.

Although electronic commerce is still at a nascent stage in the country, company sources indicate that it will largely be business-to-business in the early stages.

"In India, the focus will be on banks, insurance, manufacturing companies, the government and small and medium sized businesses," sources maintained.

Currently the Indian market contributes Rs 553 crore (US$132 million) out of IBM's total global revenues of $81 billion.

Also, while the Indian economy is half that of China, so is the market share of IBM and the penetration of PCs in India. But potentially, as Etherington indicated, India could overtake China.