Will Aakash see many takers in India

Written by Diksha Dutta | Diksha Dutta | Updated: Oct 17 2011, 05:42am hrs
No Indian wants history to repeat this time. Three important initiatives have been taken by the Indian government in the past decade to enhance connectivity, Aakash being the third attempt. Simputer, a low-cost Linux based handheld computer and one laptop per child (OLPC) were the previous two. To boost digital education, encourage connectivity in rural India and provide a fillip to e-commerce has been the primary endeavour of these initiatives.

The governments much-touted cheap computer, Aakash, has created immense excitement in the tablet industry, which is nascent, yet growing fast. As per the latest CyberMedia Research study on the Indian tablet computer market, India sales touched 1.58 lakh units in the 9-month period ending June 2011. The study points out that the tablet market has emerged very quickly with 10 vendors lining up 27 models for the consumers.

Though there are enough challenges and competitiveness among tablet makers, analysts feel that coming months will see even more players entering the tablet market, that too at low prices. Olivepad launched the first tablet in India in July 2010. The first major brand to launch followed in October 2010the Samsung Galaxy Tab. The Apple iPad, the most well recognised tablet, arrived in India only in January 2011. HCL Infosystems joined the bandwagon recently.

Step back and understand what went wrong in the past. The Simputer, first released in 2002 was envisioned as a low-cost alternative to personal computers. With initial goals of selling 50,000 devices, the project had sold only about 4,000 units by 2005. The second big hope was the OLPC pilot programme launched in India in 2007 with 20 laptops at a school in Khairat-Dhangarwada village in Maharashtra. Although the pilot programme was successful, analysts say that the human resource development ministry was highly skeptical about OLPC, and expressed concerns about the health implications of prolonged laptop use among students. Net result being, the project did not pick up too.

Cut to present: Aspirations on Aakash are big. At present, Datawind, the British company manufacturing the tablet has an order for supplying 1 lakh units to the government. The government also plans to sell 10 million tablets in the next 6-7 months and the next tender will come next month, says Suneet Singh Tuli, CEO, Datawind. The government is buying the tablets for R2,276 per unit and giving them to education institutes at a 50% subsidy.

At the same time, the government is taking a lot of precautions for adoption for Aakash. It has asked Datawind for a special

replacement warranty. The government wants the company not to repair the Aakash tablet, but replace it if any problem is faced, which will be a big cost to the company.

Challenges, opportunity and repercussions Tuli explains that the focus on Aakash had issues within the company as well. There was a big conflict at the board level as we were concentrating on Aakash before getting the tender. At a time when there was heavy demand in markets like the US and UK for laptops, we were focusing on this. But I knew we had to make it happen, says Tuli.

Analysts reckon that the India tablets market has many more models available with a range of features and at a variety of price points, compared to six months ago. However, for the tablet to become a common mans device, usage tariffs for high speed data services need to be brought down even further along with useful and relevant content for the consumer. Hemant Joshi, partner, Deloitte Haskins and Sells says, Wi-Fi and 3G connection is prerequisite for Aakash to work and we still need the basic infrastructure to support these connectivity devices.

Naveen Mishra, lead analyst, telecommunications practice,

CyberMedia Research notes, The three factors that will drive the growth in the tablet market are connectivity, content and device. All the three are partially developed till now. We need to take into account that this is a new founded market that manufacturers are still exploring and it is at an experimental stage. Right now there is no segmentation, but soon the consumer segment will get defined. At present, the main market for tablets is consumer segment to watch movies, chat etc and the enterprise segment is still picking up.

Analysts feel that there is need digital content for school and college education, which is still at a nascent stage in the country and education institutes are not open to its adoption. The good news is that the main idea behind using tablets for education purposes is for browsing and not downloads of heavy files.

Rural broadband initiative might take off soon. But definitely by 2012, there will be a plethora of tablet makers, says Joshi from Deloitte. Even other players like Reliance, Olive, Beetel have

aggressive plans to tap the low-cost tablet market, once Aakash gets commercial. It will be intriguing to see the combination of connectivity, content and communications device to succeed here.