LINUX VENDORS ATTACK VIRGIN INDIAN MARKET

From Reuters/Bangalore

BANGALORE, May 30 (Reuters): Two fo the world's top vendors of Linux, the
free open-source software platform, say they plan to attack the Indian
market which they see as virgin territory.

Red Hat Inc, which sells a popular standardised version of Linux, and
computing giant International Business Machines (IBM) announced a strategic
relationship this week.

The two, which are busy striking partnerships and holding roadshows, believe
they can mount a strong challenge to Microsoft's Windows range in India.

With low computer penetration, a cost-conscious market, a host of regional
languages and a rich crop of software programmers, India is ripe for the
picking, they say.

India has just five million personal computers in a nation of one billion
people, only a third of more than 45,000 bank branches are computerised and
thousands of small businesses are just starting to use computers.

As elsewhere, Microsoft Crop's Windows has had a strong run in India,
especially in personal computers. Linux backers hope to change that.

"We're the most cost-conscious in India," Mr Javed Tapia, a director of the
board of Red Hat India Pvt Ltd, told Retuers. "There's tremendous
potential... (and) in India we're also looking at the desktop side of the
business (unlike elsewhere)."

Designers of India's $200 'Simputer', aimed at taking Internet to rural
India, are using Linux to run the device.

Mr Tapia said Red Hat's deluxe version, including the operating system, the
Star Office suite of applications and games, retails for Rs 3,550 (US$75.70)
with no limit on the number of users.

A spokeswoman for Microsoft said the basic price for its Windows 2000 for
networks and its office suite was Rs 19,000 for each product. But the exact
price would hinge on the features chosen and the number of users.

Microsoft has traditionally emphasised easy use, a variety of functions,
strong support and cost effectiveness to push Windows.

Mukul Mathur, IBM's Linux manager for South and Southeast Asia, told Reuters
by e-mail the open source standards which enable free tinkering of code,
ease of remote management and low costs were key features of the Linux
platform.

"For these reasons, Linux is ideally suited for Indian customers," he said.

IBM is marking Linux-based software bundles aimed at small companies with
less than 100 users. an entire suite of backend software is priced at Rs
30,000. Used in conjunction with the free StarOffice, overall costs would be
low, IBM officials say.

Mr Mathur quoted a study by the independent International Data Corp (IDC) as
saying Linux sales were expected to grow by an annual 80 per cent in India
over the next five years, well above the 52 per cent growth forecast for the
Asia-Pacific region.

In line with its $1 billion global push for Linux, IBM has tied up with
three leading Japanes computer-makers -- NEC, Hitachi and Fujitsu -- NEC
announced in Tokyo on Wednesday.

Besides Red Hat, IBM is also partnering other Linux distributors in India
like Caldera Systems and SuSE. In Bangalore, IBM has started one of its
seven worldwide Linux development centres along with a separate competency
centre -- one among four in Asia.

Red Hat, which is planning roadshows in 12 Indian cities, has linked up with
leading software educational firms and is looking to partner the premier
Indian Institutes of Technology (IITs). ENDS