“The Rs 15,000 PC has become a brand”

If you have a system running at 600-800 MHz, which is still good for most computing applications, you don’t need gigabyte capacities—that is the key idea Ravi Pradhan, country manager of Via India brings out as he speaks to Chris Ann Fichardo about the challenge he faces in making the thin-client concept a commercially viable option in India

How robust are Via’s thin-client machines?

The challenge is to make people aware that even in 600 MHz you can run XP or Linux applications. People think that to use XP you need a high-end expensive system which costs Rs 40,000-Rs 50,000. If you look at a student he does not have a budget of Rs 30,000-Rs 40,000 but can definitely afford something that costs Rs 10,000.

What are the factors that are driving growth in the thin-client market?

In the US, you can get a PC for $500-$700 which is an extremely affordable price for the average American who earns around $25,000-$30,000 a year. But in India with the average salary so much lower, a Rs 30,000-Rs 50,000 PC is on the higher side and Rs 11,000 becomes the affordable price point. At Via, we are trying to bring system prices down to around Rs 11,000-Rs 12,000.

Previously, the price of a thin-client was almost same as the PC, which led to the consumer questioning the value of a thin-client. Today, there is almost a 20-40 percent difference in the price, quality has improved, replacements happen in 24 hours, warranties are offered on products etc. The thin-client market has become more aggressive. Unlike the small volumes in the past, we have clients buying 10-15,000 units from us. Companies have started seeing value in these low-cost PCs.

How has the home market reacted to Via products?

People used to ask for ‘Intel PCs’, now they ask for the Rs 15,000 PC—they don’t worry what brand it is. The
Rs 15,000 PC has become a brand and this is an interesting trend. These buyers are not conscious of saying they want a cheap product. Buyers now know that the Rs 15,000 PC is a good option and is even recommended by the IITs.

Where is adoption coming from?

Adoption is coming from households and is growing much faster than we anticipated. When we initially started we didn’t foresee such huge support from the corporate sector—we have already signed five or six contracts. In about a year from now we should have at least 30-40 corporate clients. And once the user gets used to the product in office he will think about buying one for the home. People don’t want to spend their money in experimenting.

Do you think reduction of import duties on second-hand PCs will have an adverse impact on the low-cost PC market?

Absolutely not. In an imported PC, the components are from different PC vendors and so become difficult to manage. In a Rs 15,000 PC it’s all from one vendor. It’s the management of a PC that is expensive not the hardware, so I think we have winner on our hands.

Thin-clients are a very interesting concept, but never really took off. What are the chances of survival now?

Previously, there was no industry sponsor for thin clients who looked after all segments and different markets, Via believes that we can provide full-fledged support to this market. We are also providing the hardware and know-how and even bring OEM partners to this market. The biggest drawback of the past was that nobody was there to provide technical expertise in this area. Now Via is doing it, whether it’s the motherboard or the power supply unit.

We are trying to develop a whole new market segment and so this will take some time, maybe a year or so, but we are already beginning to see results of this move. VXL for example used to sell thin client machines for Rs 18,000 to Rs 20,000, now it is Rs 11,000-Rs 12,000 because they are using industry standard parts. Earlier, most of these companies had to develop their own motherboards to support these machines, which hiked costs tremendously. Now Via has developed a motherboard for the thin-client market, which is 50 percent cheaper than what thin-client manufacturers were paying earlier.