IBM upbeat on Indian SMBs, sees Indian small business IT-spend at $10bn
6^th July 2008, Tradingmarkets.com

Sensing a huge business potential in the country's fast growing small and medium business segment, IT major IBM said it would launch an array of cost-effective solutions for its Indian SMB customers. "We expect the SMB segment to grow at over 20 per cent year-on-year. SMBs are no longer just investing in basic IT infrastructure but is looking at partners to manage their ever-complex IT needs while they grow," IBM's Global Technology Services' Vice President and General Manager, Nipun Mehrotra, told PTI in an interview here.

The total IT spend of Indian SMBs is expected to touch USD 10 billion this year, of which USD 1.1 billion is expected to be spent on IT services alone, Mehrotra said. IBM, which is presently on a massive expansion drive to rapidly strengthen its footprint in Indian SMB market, has an SMB customer-base of above 1,700 customers here, Mehrotra said, adding, "IBM has targeted to sustain the growth rate in the present fiscal as well". The IT major had announced 'Packaged services' for Indian SMBs in July, 2006. This was primarily aimed at those customers looking for "easy to choose, easy to implement solutions", he said.

The IT giant has been investing heavily in its SMB-focused business in India with a view to strengthen its domestic operations in this segment, Mehrotra said. However, he did not divulge any further details of the investment plans.

IBM had acquired Bangalore-based network solutions provider, Netsol, two years back enabling the IT major to enhance its footprint to more than 60 cities and 140 project locations in the country, Mehrotra said. IBM presently offers various SMB-focused solutions and services such as Scalable Modular Data Center (SMDC), Network Operations Center-Inside, Integrated Infrastructure Management services and Site Assessment services.

SMDCs are smaller version of datacenters designed for SMBs and carry most of the features of large-scale enterprise level data centers, he said. IBM deployed SMDCs for 15 customers in last year, allowing the enterprises to have small-sized data centres ranging between 300-3000 square feet, he said. The IT-major, which had acquired local firms--Network Solutions and Daksh in the services space, has also plans to increase its presence in the country through the in-organic path, Mehrotra said.

"IBM is always open to the idea of acquisitions to drive shareholder value," he said. Early this year, the company's Worldwide Evangelist for Security, Pierre Noel, had told PTI in an interview that the IT giant was planning to increase its investments in its India-focused security business this year.

The investment would be done out of IBM's USD 1.5 billion global security budget and will fund the IT-majors ongoing projects to develop new security products in the country. As on December 31, 2007, IBM has nearly 73,000 employees in the country and has two research labs in Delhi and Bangalore. It also runs two other development labs in Pune and Bangalore.