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Intel sees opportunity in Indian PC market
By agencies
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Tuesday, 07 June 2005, 19:30 IST
BANGALORE: Intel, whose chips power 80 percent of the worldÂ’s computers, sees India as a huge market for its personal computers.
The semiconductor giant led by Chief Executive Paul Otellini sees India as a steady market for its personal computers. According to a report in the Financial Times, the chipmaker says financing is the catalyst: PCs can be bought for a monthly payment of 
499 ($11.45) per month. Some reports say Intel sees its annual sales in India growing by some 30 percent.
Intel is advising Indian banks and PC makers on how to market loans to attract more buyers among the 100 million middle-income Indians who earn less than 6, 000 ($143) a month. India's PC market is still only a third the size of China's even though the country is home to software developers like Infosys Technologies and Tata Consultancy Services.
Intel stands to gain as India targets increasing the number of households with PCs fourfold within the next four years, to 65 of every 1,000. The country's decisions to eliminate excise taxes on microprocessors in January 2004 and on PCs in July have already reduced the cost of personal computers by a third, Intel said. The company supplied the chips for almost 90 percent of the 3.6 million computers shipped to India last year, according to the market researcher IDC.
To increase sales, Intel this year arranged for financing from State Bank of India, Indian Bank and Bank of India for people buying PCs assembled by local merchants or made by Indian manufacturers like HCL Infosystems and Zenith Computers.
India lags in the consumption of information technology services even though technology, primarily software and services, accounts for more than 25 percent of its exports.
The country's hardware market is a fragment of the 175 million servers, desktops and laptops shipped worldwide in 2004, according to an IDC estimate. The United States accounts for almost one third of the total, while China and Japan account for 12 million to 15 million units each.
India, with a population exceeding one billion, also lags in Internet access. The country has about 20 million Internet users, compared with 80 million in China.
Providing financing for buyers may help increase the number of computers sold in India by 5.5 million units over the next four years, according to a report by the Ministry of Communications and Information Technology.
Intel's involvement in arranging loans for computer purchases is needed because most of the Indian manufacturers and the assemblers are too small to negotiate financing directly, said Amar Babu, the company's director of sales for South Asia. Companies that assemble computers from other manufacturers' parts account for about half of the Indian market, according to the industry group MAIT.
"The opportunity is just very, very large," Babu said. "The challenge with financing is, the deeper you go into the country, the harder it is to get."
499 ($11.45) per month. Some reports say Intel sees its annual sales in India growing by some 30 percent.
Intel is advising Indian banks and PC makers on how to market loans to attract more buyers among the 100 million middle-income Indians who earn less than 6, 000 ($143) a month. India's PC market is still only a third the size of China's even though the country is home to software developers like Infosys Technologies and Tata Consultancy Services.
Intel stands to gain as India targets increasing the number of households with PCs fourfold within the next four years, to 65 of every 1,000. The country's decisions to eliminate excise taxes on microprocessors in January 2004 and on PCs in July have already reduced the cost of personal computers by a third, Intel said. The company supplied the chips for almost 90 percent of the 3.6 million computers shipped to India last year, according to the market researcher IDC.
To increase sales, Intel this year arranged for financing from State Bank of India, Indian Bank and Bank of India for people buying PCs assembled by local merchants or made by Indian manufacturers like HCL Infosystems and Zenith Computers.
India lags in the consumption of information technology services even though technology, primarily software and services, accounts for more than 25 percent of its exports.
The country's hardware market is a fragment of the 175 million servers, desktops and laptops shipped worldwide in 2004, according to an IDC estimate. The United States accounts for almost one third of the total, while China and Japan account for 12 million to 15 million units each.
India, with a population exceeding one billion, also lags in Internet access. The country has about 20 million Internet users, compared with 80 million in China.
Providing financing for buyers may help increase the number of computers sold in India by 5.5 million units over the next four years, according to a report by the Ministry of Communications and Information Technology.
Intel's involvement in arranging loans for computer purchases is needed because most of the Indian manufacturers and the assemblers are too small to negotiate financing directly, said Amar Babu, the company's director of sales for South Asia. Companies that assemble computers from other manufacturers' parts account for about half of the Indian market, according to the industry group MAIT.
"The opportunity is just very, very large," Babu said. "The challenge with financing is, the deeper you go into the country, the harder it is to get."