Want WiMAX? Well, Dishnet might answer your prayers

When Dishnet DSL first entered the market in 1998, only dial-up facilities were available. The industry scoffed at the new broadband initiative-at the 128 kbps offered at a premium-and at the business model. There were rollout problems and servicing issues: TV cable operators cut overhead Dishnet lines and road diggers spoilt the rest. Other telcos and internet service providers also joined the game in 2002 and offered the same 128 kbps service. But, by then, Dishnet had already upgraded offerings to 512 kbps, and by 2004, sold the business to Tata's vsnl for Rs 273 crore.

Wireless activity takes away some of the Indian imponderables, such as road digging, feels C. Sivasankaran, Chairman, Sterling Infotech Group, and promoter of Dishnet DSL. Today, the company is planning Wi-Fi hotspots (6,000 in 18 months), even as pilot wimax facilities are being tested. wimax is an external modem that can be fitted into a laptop for mobility anytime-anywhere; it also works with a pc. The connectivity is 512 kbps, says V.G. Suriyanarayanan, Vice President, sales and marketing, Dishnet DSL. With 5.7 lakh notebook owners in the country, and with penetration growing at 200 per cent per annum, both services could take off with a bang. (Dishnet already has 200 Wi-Fi hotspots). It has lined up investments of Rs 250 crore for these initiatives and hopes to break even in two years.

Sivasankaran has repeatedly said: "Not to make profits is a sin; but to be sentimentally attached to a business forever is foolish!" It's a belief he's turned into a tried and tested business model: be the first mover, pioneer a new business, make a success of it and then cash out. Will he do it again? Watch this space.

-Nitya Varadarajan

Carlson Calling
The Carlson Group is expanding in India.

Carlson Group's Nelson: Indian hospitality beckons

She enjoys being a grandmother more than being a CEO, "but only just". Meet Marilyn Carlson Nelson, 64, CEO of the $25-billion (Rs 1,10,000-crore) hospitality and travel services provider Carlson Group. The Minneapolis-based Carlson-which owns the Radisson, Park Plaza, Country Inn & Suites hotel brands and the TGIF chain of restaurants-is in expansion mode. "We have 22 hotels in India, and have signed contracts for 14 new properties," informs Nelson. Also on the anvil: plans to launch the top-end Regent Hotels brand in India. "I believe, the travel industry in this country is poised for a boom," she adds. Interestingly, Carlson manages all its Indian properties under contracts. However, Nelson points out that the Carlson Group has invested money in its Wagonlit travel services joint-venture in India and has also established IIMT (Institute for International Management and Technology), a hotel management institute with campuses in Kolkata and Gurgaon.

India is on her radar for another reason as well. She's scouting for a BPO partner who can take care of Carlson's considerable back-office functions. "But if we transfer some transactions to India, jobs will be lost elsewhere. So, it is a very delicate tightrope." she says. Going by her track record, it'll be a breeze.

-Kushan Mitra

Good, Better, Oops!
Mphasis discovers just how fickle fortune is.

Agents in the hood? Yup, and they worked for Mphasis

Six months after this magazine called Mphasis Indian it's next big thing (see BT, June 6, 2004) and barely a month after it described how the company was now trying to buy its way out of trouble and to growth (see Acquire Or Die, BT, April 10, 2005), the company surprised almost everyone with a 32 per cent growth in revenues and a 26 per cent growth in earnings (2004-05 over 2003-04). The modest growth of the IT services component of this (22 per cent to Rs 481.47 crore, and this now accounts for 62 per cent of the firm's revenues, down from 67 per cent last year) is a cause for concern, not alarm. More immediately, the company's results for the last three months (the period ending March 31, 2005) were modestly-impressive with revenues increasing 29 per cent, earnings 23 per cent, and revenues from it services, 27.6 per cent.

Not long after, an international study of BPO (business process outsourcing) firms (see The World's Best BPO in this section) named Mphasis the world's fourth best BPO. The fact that it scores over Wipro Spectramind, Progeon and other larger firms wouldn't have been lost on the company.

If the celebrations have been muted, it is because Mphasis has been embroiled in a controversy involving three former employees of its call centre arm Msource who siphoned some Rs 1.5 crore (around $340,000) off the accounts of some CitiGroup customers in New York.

In a surprisingly well co-ordinated heist, the gang (some 14 people have thus far been arrested) obtained personal identification numbers, and using an elaborate chain of false addresses and bank accounts defrauded a few customers. "At no time does Mphasis have access to pin numbers, which are required to access accounts. While the case is still under investigation, it is assumed that the fraudsters memorised account information and phone numbers and contacted the consumers directly for the pin numbers," says the firm's chief executive Jerry Rao. In a classic demonstration of bolting the stable door after the horses bolted, the company has now tightened security procedures and India's National Association of Software and Service Companies (NASSCOM) has called for a database of all BPO employees. Meanwhile, unions in the West are gloating and Mphasis is discovering just how fickle fortune can be.

-Rahul Sachitanand

OBITUARY
T. S. Santhanam 1912-2005

A week before he breathed his last in Chennai on April 15, Trichur Sundaram Santhanam was busy calling up his sons and grandsons, checking on the outstandings on their books. But such was Santhanam, son of TVS Group founder T.V. Sundaram Iyengar: hands-on and passionate about business. "He loved numbers", recalls his nephew and Sundaram Brake Linings Chairman K. Mahesh. Joining his father's business when he was only 18, Santhanam quickly established himself as the group's "money man". In 1954, he set up Sundaram Finance, which still remains one of the most respected finance companies in the country. Santhanam equally loved sports. In the late 40s, he founded the Madras Greens, a club that boasted of several top football players. A tennis player and fan, Santhanam was often spotted in Wimbledon, cheering Indian tennis champ Ramanathan Krishnan from the stands. "When we think of JRD Tata, we only think of him foremost as a great Indian, and that is what I wish to say of Santhanam," says T.T. Srinivasaraghavan, Managing Director, Sundaram Finance, who worked with Santhanam for the last two decades.

Back To Basics
The Razr helps Motorola's cause.

Nokia's Warrior: On to the battlefield with tech-savvy tactics

New boss ED Zander's gamble is beginning to pay off. Facing an onslaught from Korean chaebols like Samsung and LG and rejuvenated market leader Nokia, Zander, a former chief of Sun Microsystems, decided that the $31.3-billion (Rs 1,37,720 crore) Motorola should fall back on its core engineering and design capabilities. Its new anthem: seamless mobility. "We will focus on accessing information from any device and any location seamlessly," Padmasree Warrior, Motorola's Executive Vice President and Chief Technology Officer told bt.

The restructuring worked: Motorola's Razr phone model boosted sales by 35 per cent and helped it turn the corner. This slim phone, made of space-age alloys, packs in Bluetooth, camera and instant-messaging capabilities in a chic, ultra-modern, steel-grey body. "Sure, we missed some trends, but we are in constant touch with customers and partners to try and get a sense of what the market wants," says Warrior, adding: "Motorola has launched over 20 products in the last few months itself."

So, Motorola, which spent $3.5 billion (Rs 15,400 crore) or 11 per cent of its sales on R&D last year, will lean on research centres (including one in Bangalore) to drive innovation. Its Indian operations will also work on building a handset tailor-made for emerging markets, Warrior discloses, adding that the first such phone will hit the stores in mid-2006.

According to technology analysis firm Instat-mdr estimates, Motorola's global market share in mobile phones at the end of 2004 stood at nearly 16 per cent, compared to under 13 per cent for Samsung. Nokia is still the market leader with a 30 per cent share of the market. "I don't see Motorola losing out to Samsung and LG anymore," says Neil Strother, Senior Analyst, Mobile Devices, Instat. That's indeed good news for a company that invented the cell phone.

-Rahul Sachitanand

DEALMAKING
Going, Going, Boeing...

Boeing's Keskar: Price conscious?

Boeing seems to be flying away with the game in India. Air-India is likely to place a massive Rs 51,000-crore (close to $12 billion), 50-aircraft order with the US aerospace major (Boeing will get $6 billion or Rs 26,400 crore; the rest will go to other suppliers). The contract reportedly includes eight 777-200LR ultra long-range aircraft, 15 777-300ER long-range 350-seater planes and 27 787-8 long-range 250-seater aircraft. "These aircraft will offer Air-India both fleet commonality, economy and reliability at a great price", boasts Dinesh Keskar, Boeing VP, South Asia.

Boeing's European rival, Airbus Industrie, is obviously not very pleased at this turn of events. "It is surprising that Air-India has not considered the new Airbus A350, or the A380 double-decker aircraft," says Airbus spokesperson David Velupillai. According to Civil Aviation Ministry sources, the Airbus offer was deemed to be too expensive. There's more: Indian Airlines' Rs 10,000-crore order for 43 planes might also go to Boeing. These huge orders, it is learnt, will give India the political leverage it so lacks on Capitol Hill.

-Kushan Mitra