Making A Debut

Though a late entrant to the planning process, Goa has emerged as one of the
most developed states in India. It has even achieved the ranking of one of the
best states in India with regards to investment environment and infrastructure.

In the last few years, the State government has been promoting information
technology in all possible ways. The Cyberage scheme implemented by the State
for the student community is an example of how keen the government is in
promoting PC penetration. Around 15,000 PCs were given away last year to
students at an extremely subsidized rate.

The uniqueness of the scheme was well received. While the State has been
overfriendly with its policies to promote IT, there were dark sides to it on how
the scheme was implemented.

According to many Goans, entrepreneurship was killed because of this scheme.
The total size of the PC market in Goa excluding the Cyberage scheme is put at
around 8,000 to 10,000 PCs in a year. "And when the government dumped over
250 PCs in the market, what can the channel community sell?" asks a PC
dealer.

The government justifies it by saying that in years to come, these PCs will
increase the market for upgrades and peripherals. But, how long can partners
wait is the question.

Recently, there were indications from the new Government about reviewing the
Cyberage scheme, according to some newspaper reports. Which means, the scheme
may be discontinued if the government does not find it beneficial for IT growth.

There are over 200 channel partners serving Goa's entire IT hardware and
basic software needs. Of this, only about 100+ are active partners. Of these
100, less than 10 partners are in to solutions providing, with revenues ranging
from Rs 1 crore to Rs 4 crore. The rest all are under the 1 crore revenue
bracket.

The customer segment is generally divided in to SOHO, corporates and the
Government. Majority of partners look for business from the SOHO segment.
Students and small business make a good chunk of the SOHO business. The purpose
of PCs is mainly for education and Internet usage.

 Only a few cater to the corporate and the Government segment. Most
Government deals involve the participation of vendors and a handful of
distributors directly. Customers in the corporate segment are mostly banks and
industries.

There are quite a few industries in Goa. But all these have their
headquarters in Mumbai and hence the procurements of IT infrastructures are
usually done from Mumbai itself. This area is not very lucrative for the
channels. However, partners still have an option of servicing these companyies'
IT infrastructure.

2004-05 was rather slow for PC business compared to the previous fiscal
according to channel partners. This was because of the Government involving
direct business from vendors and suppliers under the Cyberage scheme.

Goa cover an areas of 3,702 square kilometers. Despite its tiny size, it has
some of the best IT infrastructure. The presence of Software Technology Park,
excellent public utilities, and good broadband connectivity, make this place an
ideal destination for IT investors. Goa is also rated amongst the most literate
states in the country.

A very striking feature of Goa is the harmonious relationship among various
religious communities, who have lived together peacefully for generations. It is
also known for its tourism, which attracts people from all over the world for
its scenic beauty of coastal regions. The only sad part is that, despite its
best IT infrastructure, nobody has taken the initiative to make use of IT for
promoting tourism actively to the world.

ASSOCIATION PROFILE: Goa IT Business Association (GIBA)

FORMED: 1998

OBJECTIVE: To come under one umbrella and fight illegal activities and
harassment of the IT channel community

MEMBERS: 40

OFFICE BEARERS

PRESIDENT: Dhiren Mehta

VICE PRESIDENT: Vinayak Naik

GENERAL SECRETARY: Balakrishnan Prabhudesai

TREASURER: Gomes

The Goa IT Business Association (GIBA) has been functioning with nearly
one-third of the active IT channel community as its members. According to Dhiren
Mehta, President of GIBA, there are over 200 IT channel partners in the entire
state of Goa. Of this, only 125 partners are actively involved in IT business on
a regularly basis.

Currently, GIBA has about 40 members and by the end of this year, the
committee hopes to rope in another 20 members. "From next year, our target
will be to add 25% members every year," said Dhiren.

Seven years ago, when GIBA was formed, members had only one main objective-to
unite and fight illegal and unfair trade practices. Getting all members to unite
is not an easy task, but GIBA has been putting in its best to build a healthy
relation among its members. The association meets once in every two months to
sort out problems faced by its members or the channel community.

"Meetings usually attempt at resolving problems such as difficulties in
dealing with distributors, billing and delivery issues and service
problems," informed Dhiren.

Twice in a year, the association holds welfare activities involving the
families of the members. This usually happens in February when the business is
slow, and once during Ganesh Chaturthi. "Family get-togethers help improve
long-term healthy relations among the dealers," felt Dhiren.

So far, the association has successfully held IT expos, distributor meets,
training sessions and seminars. Vendors or the association usually sponsors most
events. The new committee, which was formed last April, has a new task in hand.
According to them, increasing the membership numbers will be the priority.

They are also in the process of developing a website, which will act as a
window for the outside world to know about GIBA. A member directory is also
planned in the current year. This directory has a lot of information about
members and their family.