Bill Gates, Chairman, Microsoft & Rajiv Kaul, Managing Director, Microsoft Corporation India (R): Inida is key to the software monolith's global gameplan

If you want to start a religion you'd better find some followers. The seer of Redmond-part of his designation, then, Chief Software Architect, is apt-wants to. India is no whistle-stop on William H. Gates the Third's ongoing journey to spread the gospel according to Bill (and, consequently, Microsoft) to the world; it is central to the company's efforts to build a following for its way, one that encompasses computing anytime, anywhere, and on any device. The importance of being India is evident time and again during Gates' four-day, four-city trip to India between November 11 and November 14. In Delhi, he ends a presentation to CEOs by exhorting them to get their developers to work on .Net, Microsoft's bet-the-company web services initiative-something that, shorn of jargon, will allow organisations and individuals communicate and share data without in-depth knowledge of each other's it systems. But it is in Bangalore, where he addresses a gathering of 3,000 developers from several companies at Infosys' Roman-style amphitheatre, and another gathering of 4,000 Wipro developers across the road that Gates is at his evangelical best.

At both locations, the gathered geeks cheer him as if he were a rock star. "Gates is an icon of the software industry," gushes K. Swaminathan, one of the developers who has managed an invite to the event at the Infosys campus. "It is a privilege to be able to share his thoughts live." One follower found.

Gates pushes all the right buttons. "Software is magic," he says at the first talk. "The software industry is the most exciting place to work." Cheers erupt. "A few years back, people would have been wary of doing mission-critical work in India," he says at the second. "Now, customers insist that India be considered." Cheers erupt again. More followers found. It isn't all about software and India. Gates takes a few swings at the competition and, time and again, pushes the virtues of .Net.

Microsoft's Group Vice President, Worldwide Sales and Marketing, Orlando Ayala, knows exactly how important India's half-a-million-odd developers are to the company. He first came to India in 1984 and has been to the country five times since, spending close to three weeks on one trip and authoring a concept note on why Micorosoft had to be in India. "Priority number 1 (for Microsoft) is to find out how we can better our relationship with developers," says Ayala, his English tinted with a heavy Mexican accent. "And this country has a unique position with respect to developers."

That's one strand of Microsoft's Great Indian Manoeuvre. Listening to Rajiv Kaul, the tall and always impeccably dressed Managing Director of the company's Indian operations spell out initiatives in the areas of education, e-governance, and market development, the other strands come into focus-a complex weave of what, at first sight, appears to be philanthropy, corporate social responsibility, and a planning-horizon that stretches well into the inconceivable future.

Kaul rattles off the three phases of Microsoft's growth in India: Phase 1, running up to 1997, was essentially all about establishing a presence; Phase 2 was when the company focussed on distribution, invested in localisation, grew the number of Microsoft Certified Professionals from 1,000 to 100,000, started working with governments and partners, and fought piracy. "Now in Phase 3," says Kaul, "we want to move up to the next level- help our partners do even more, help developers acquire skills that can make them architects, and make India an offshore superpower for (our) .Net (platform)."

The strategy is all that, but it is also one that could pay off, and pay off big, not next quarter, even next year, but over the long-term. "It is not a pure India business point of view," explains Sanjay Mirchandani, the former CEO of Microsoft India, and now President, South Asia, Microsoft.

"Priority number 1 for us is to better our relationship with developers. And this country has a unique position with respect to them" Orlando Ayala, Group VP (Worldwide Sales & Mkt.), Microsoft

The present strategy, according to him, is built around Microsoft's development centre in India, some outsourcing that is being moved to the country, projects that the company is working on with key partners, and recognition of these partners within the global Microsoft system. "That has been the shift in the past couple of years; and it is going to be even more pronounced now." Maybe that can explain a four-day trip to, and announcement of an investment of $400 million in a country that contributes less than 1 per cent to Microsoft's global sales of $28.37 billion.

Accelerated Development

Microsoft India Development Center's all-glass-and-wood ninth floor office in Hyderabad's Cyber Towers is where one strand of that strategy originates-it ends in Redmond. Srini Koppolu, the tall Vizag native picked by Microsoft to head the centre, knows all about what R&Ding in Redmond is like: he worked 10 long years there (and has several patents to his credit on several of the company's best-selling products, including Office and IE 3.0). Already, he claims, "MIDC has been involved in developing products and technologies in some key focus areas for Microsoft." That, in the four years since it was founded in 1998, it has.

"Companies and governments have systems on different pieces of technologies. The .Net framework allows them to integrate these" Rajiv Nair, President, Microsoft Corporation India

In 2000, MIDC rolled out Windows Services for Unix Ver 2.0, an add-on that helps Windows co-exist with Unix, a product that helped the company sell to companies with legacy Unix systems; this year it came up with Ver 3.0; and now the centre is working on the next. In June this year, Koppolu's men rolled out Visual J#.Net, a product that gives a good reason for Java language programmers to convert to the .Net religion (technically speaking, it enables VJ++ customers to move to .Net). And MIDC is working on a key Microsoft initiative, enterprise storage. "Information is the most valuable asset a business owns," explains Koppolu. The centre's enterprise storage group has the task of making Windows the best platform for storage systems.

Gates spends three hours with the developers at MIDC on this visit. He must like what he sees and hears. By 2005, he states, MIDC will be Microsoft's largest development centre outside the US, its workforce will increase from 150 to 500, and the company will invest an additional Rs 500 crore in it. Still, if you want to proselytise the masses, you need apostles.

The new Apostles

On his last visit to India two years ago, Gates found those apostles. "I said," recollects the man, "Let's assume Infosys, Wipro, Tata (Consultancy Services), and Satyam do achieve their vision; we need to start working with them; even help them find opportunities around the world." "We've put pretty big investments into our partnerships here."

The Infosys Microsoft Enterprise Architecture Lab is one such investment and Gates makes sure to register his presence there during his visit to Infosys. "The lab studies, develops and promotes Microsoft's .Net architecture," says S. 'Kris' Gopalakrishnan, Chief Operating Officer, Infosys, during the occasion. And it showcases .Net's capabilities to prospective customers through what the software industry calls 'proof of concept', as close to a demo as you can get without it being the real thing. Other partners, in other parts of the country are also working on similar initiatives in association with Microsoft's .Net research centre in Bangalore.

Ayala saw some of them in action on a recent visit to the city and was blown away. One was a core-banking application, another allowed farmers easy access to credit, the third was an enterprise resource planning package for schools, and all were built around .Net. "Getting our partners to be creative and making the software come alive (through such applications) is very much part of the Microsoft business model," says Ayala. "That's why we are excited about India."

The Great Indian Software Juggernaut will, as it continues its relentless progress across the world, take such solutions with it, but there is another, more competitive aspect to Microsoft's partnerships as becomes evident during Gates' talk to the Wiproites when he suggests that a Microsoft-Wipro combine can best IBM, the company's "largest, and thus far, most important competitor". That's where the not-so-well-known consulting division of Microsoft, Microsoft Services, could play a role.

Here's how this works: Microsoft Services deploys mission-critical solutions for a few top-end customers in association with its partners. Apart from accelerating the acceptance of the company's technologies and platforms, this also helps the partners go out and provide similar solutions to other companies. "We are not a consulting company," says Kaul. "We don't make money on services, but this helps our partners and customers." And the company, of course.

The focus on partnerships, and its efforts to be on the right side of the Indian developing community will also ensure that Windows doesn't lose out to Linux, although this isn't as close, or as life-threatening a race as most people make it out to be. "If anyone is hit hard by the growing popularity of Linux, it should be Sun and hp," says IBM Asia's Linux Business Manager Sandeep Menon. Coming from a competitor, that closely echoes Gates' own assessment of the situation.

Still, there are enough rabid penguins out there to be cause for some concern, and rightly so: Linux isn't going to go away. "It is not an issue of whether users will eventually move to Linux, but when," says Javed Tapia, the head of the Indian ops of Red Hat, the world's largest vendor of Linux. "Increasingly, public sector organisations, governments, and others are recognising the cost and other benefits of using Linux as an operating system." He's right: from c-DAC, the government-owned supercomputer company, to the Supreme Court, which has a few pilots on, to HDFC Bank, and the National Stock Exchange, they have. The corporates, Microsoft and its partners can handle; governments and their arms are different. And that is where Rajiv Nair and his team of nine come in.

Getting India Hooked

"It is not a pure India business point of view. That has been the shift in the past couple of years" Sanjay Mirchandani, President (South Asia), Microsoft

Nair, Microsoft's first employee in India, is the company's point man for its e-governance initiatives that are at various stages of implementation across 12 Indian states. Remember the much-written-about Gyandoot project in Madhya Pradesh's Dhar district that enables farmers access information through cyber kiosks? Microsoft was a partner. And remember the not-so-much-written-about Bhoomi project in Karnataka that digitised 20 million land records (See Freedom In The Fields, BT, July 21, 2002)? Microsoft was a partner in that too.

Nair is quick to rule out any immediate commercial benefit of such initiatives. "These governments would have anyway undertaken e-governance," he says. ''Our involvement has just accelerated the process." There's no arguing the fact that projects such as Gyandoot and Bhoomi have made governance transparent and improved the lot of countless individuals (predominantly farmers).

In the long run, though, they are certain to pay off for Microsoft. The world over, governments are huge customers of hardware, software, and applications. By getting in early, Microsoft has ensured that its own platforms and technologies enjoy top-of-mind awareness among the very people who could one day place orders for hardware and software to wire up an entire state or government department. "Historically," says Nair, "companies and governments have built systems on different pieces of technologies." "The .Net framework allows them to integrate these systems into one cohesive whole."

That's the same long-term attitude evident in Microsoft's educational gambit: it subsidises the cost of the Microsoft Certified Professional examination-an effort targeted at facilitating the creation of more software pros conversant with the company's platforms-and that of software sold to educational institutions. Surely, the thinking goes in Redmond, all this must pay off sometime.

-additional reporting by E. Kumar Sharma, Venkatesha Babu and Roshni Jayakar

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