The dot com bust and the ensuing slowdown forced many companies to throw in the towel. But not so for Pradeep Kar and Microland. The man is still bullish on the company’s prospects and believes he can win the day. Pankaj Mishra tries to find out the reason behind such optimism

Microland founder Pradeep Kar is no stranger to the highs and lows of business. From the Internet boom of the late nineties—when he launched ITSpace.com and indya.com, to the ensuing bloodbath, which saw these ventures die a quiet death, the man has seen it all. More recently, Microuniv, Kar’s educational venture also closed shop which he says matter-of-factly was inevitable. “Microuniv was supposed to establish itself in the e-learning space, which is no longer a viable business option.” Industry sources are also questioning the prospects of Planetasia.com, which till recently was focussing mainly on dot com clients. However, for Kar the show must go on. He is busy scripting ‘version 3.0’ for Microland, which he says will let group companies steer away from the current crisis. According to him, Planetasia and Innerframe put together will account for around 80 percent of the group’s revenues this year.

Kar believes the company has the grit and detemination to pull through

Notwithstanding, the slump in business and the dot com bust, Pradeep Kar is still bullish on the company’s future prospects. This has to great extent been fuelled by the recent client acquisitions by Planetasia, Netbrahma and Innerframe. Microland too has clinched some major deals in managing remote services. Kar expects these to account for 15 percent of the group’s revenues this year. He plans to close year ending March 2002 at $25 million and in a turn of events that have seen before, expects substantial capital infusion in the group by the time. Sources close to the company state that Netbrahma is on the verge of finalising a strategic investment. Official sources however, declined to comment.

Planetasia.com
Planetasia.com, whose launch in 1997 marked Microland’s complete exit from the hardware business is currently going through a restructuring phase. As part of this gameplan, the company will focus primarily on enterprise accounts. “There were around 800 companies listed on the BSE and we knew that each one of them is going to need a Web presence. Therefore we launched Planetasia.com, a company focussing on Web design and integration,” says Kar. At that time, Microland wanted to become the ‘Cisco of the Internet space’ in India.

Anand Sudarshan, co-CEO Planetasia, spoke about the recent deals clinched by the company in UK, US and Asia but refused to divulge details. He merely said that while one was a global telecom major based in UK, another was one of the ‘horsemen of the Internet economy’. Sudarshan admits to facing pricing pressures and says that revenues are going to be lower than last year’s $15 million. “Almost 50 percent of our projects are fixed price-based with offshore billing rates hovering around $40 per man per hour. The US which formerly accounted for more than 70 percent of Planetasia’s revenues will account for 40 percent this year, while Europe and Asia will account for 30 and 20 percent respectively,” he says. The company has identified Media, Pharma and Insurance as new business areas and plans to earn around 80 percent of its revenues from these segments.

Innerframe

Innerframe, which was supposed to be hived off from Microland to provide technology infrastructure services, will now exist as ‘Microland’ with the spin-off plans still invisible. Innerframe is now expected to play an instrumental role in the group’s consolidation exercise and has forayed into providing ‘remote services’ to enterprises. M S Rangaraj, director-marketing and new business initiatives, Microland says that the remote services will fetch revenues in the range of $3.5 million this year. “We have been in the business of managing and monitoring technical infrastructure of enterprises for long. Doing this from India, is what we call remote services,” says Rangaraj. In the Managed Service Provider (MSP) space, Microland competes with Wipro Infotech, and HCL. But according to Rangaraj, even Infosys and TCS are now emerging as potential competitors in this segment. Even though the company is doing battle with the big boys, it recently managed to bag a Fortune 5 client for offering remote services. The project is valued in excess of Rs 1 crore and involves managing the client’s call centre located in India. A team of 65 professionals is managing the entire project.

“Our core competency lies in the expertise that we have garnered for the last 2 years at Microland. We have a team of 730 engineers devoted for managing technology infrastructure,” Kar says. With India emerging as the hub of offshore call centres, the segment holds immense potential for Microland.

Netbrahma

According to sudarshan, the company is looking at reducing its dependence on the US in the years to come

Netbrahma, focusing on providing Internet infrastructure services and stacks, is believed to be moving up the value chain. The company is developing stacks in the areas of telecom convergence and IP infrastructure. “We were initially looking at the US market, but owing to the slump, are now exploring opportunities in Asia. In Taiwan, we have entered into a marketing arrangement with a local vendor and are also talking to potential clients in China and Korea,” says Bhaskar Sharma, CEO, Netbrahma. He adds that during April 2001 the company’s services business took a beating and therefore, selling productised solutions in the form of stacks began as a viable alternative. During May 2001, Netbrahma’s projected revenues were $4.5 million for year 2002, but figures have fallen since then to a meagre $2.5 million. At present, services account for 80 percent of the revenues at Netbrahma, but moving forward, Sharma is looking at a 50:50 mix between services and productised solutions.

“We are in the process of rebuilding Microland, times are difficult and the pricing pressures are high. Fortunately, our core management team has stayed together in these testing times,” says Kar. Till last year, when Kar joined the Internet bandwagon with indya.com and ITSpace.com, industry sources were predicting Rs 300 crore revenues for the group by 2005. But today, Microland is even shy of talking about a possible IPO. Daunting task ahead for Kar, who will now have to work harder to lure investors. Planetasia and Innerframe hold the key to the group’s future as both of them are now boasting of Fortune 5 clients. But it remains to be seen if Kar can pull this one off!