TIS digital classroom biz set to overtake legacy training

Written by Nikita Upadhyay | Nikita Upadhyay | Mumbai | Updated: Mar 6 2012, 06:15am hrs
Tata Interactive Systems new push to provide digital classroom solutions will overtake its two-decade core business of selling modules to train company executives next fiscal as Indian schools choose digital solutions to supplement traditional teaching.

This segment is fast catching up in terms of revenue contribution and, over the next two years, will emerge as the largest contributor to our revenues, said Sanjaya Sharma, chief executive officer, TIS. e-learning business, started in June 2011, now contributes one-third revenues. TIS, promoted by Tata Industries, had to find new growth avenues as its core business was stagnating.

The growth was coming to a stagnation," says Sharma. Training budget of corporates are not like their IT budgets. So, its growth was limited to a certain extent.

An entry to make digital solutions for classrooms was complementary as the company had been creating content from kindergarten to 10th standard and will soon launch content for higher standard students.

The company has several advantages by its side, but will have tough competition from established rivals.

A huge market growing at 30% a year, affordable products and lack of skilled teachers favour growth, but has established classroom and e-education providers Educomp, Everonn, Eduserve and Teachnext fighting for the same share.

Digitalising content is a market which is about $25-30 billion now and is growing at a 30% CAGR, said Narayanan Ramaswamy of KPMG. Still, less than 10% of schools in India would be digitalised, which throws upon a huge business potential for such companies.

The average additional fee that a parent has to shell out is between R80-150 per month and solutions have better longevity and retention value. Exam modules help save time and cost for schools.

Gototest.com, which provides testing, evaluation and progress monitoring for students, saves anywhere between 20% to 25% teacher's time. If this is the way tests would be conducted, I would love to write a test even on Sunday, said a student of a Mumbai school which uses solutions from Gototest, a company which has testing solutions from class 4th onwards.

We are actively in talks with about 60% of publishers like Navneet and Sheth to create e-books and put an interactive layer on them, said Gautham Maediratta, vice-president, marketing, Attano, a Bangalore-based e-books provider. These books are also available 25-30% cheaper.