Watch Out

I will call it a pretty damning report, and it certainly gives food for some
serious thought. Specially to those who are involved in planning and building
the IT infrastructure of the country; and to the leading IT leaders like IBM,
HP, and Sun who claim to be partners in progress and not 'mere' vendors.

A recent survey reveals that in India's high-end computer market in
infrastructure verticals including financial services, process manufacturing,
retail trade, services (telecommunications), transportation, utilities and
wholesale trade, three players control almost a market of hundred players. IBM
leads with 50 percent market share, followed by HP at 33 percent, and Sun at 17
percent.

This report has been brought out by OpenMainframe, a forum comprising
industry and IT representatives, and other stakeholders. Those involved in the
report are heavyweights such as senior economist Bibek Debroy, Indian Council
for Research on International Economic Relations (ICRIER) chief Dr Rajiv Kumar,
and Jeff Gould, editor of OpenMainframe.

If this is true, then there can be very serious questions about how free and
fair is the competition in this space, and if it has resulted in blocking entry
of some key ingredients that will give vital competitive edge to IT deployments
- new innovators, bundling of IT goods and services for the best of breed
approach, and universal inter-interoperability between IT systems.

The experts behind the report are bang on when they say that "given the need
for inclusive growth in India... in the last few years, social sector programs
have seen a dramatic increase in scale and scope targeted towards the
underprivileged... it is imperative that the public and private sector build a
large-scale IT back-end, especially high-end servers, including mainframes. For
this, it is vital that there is free and fair competition in the mainframe
sphere in the country"

And considering the fact that large computers will play a critical role in
some of the big infrastructure and e-governance projects, it is important that
this report be taken seriously.

The Indian high-end computer mainframe market is still small, but is likely
to take off considering the thrust on large infrastructure projects including
Unique ID, 2011 census, land records and police modernization, national
knowledge networks and so on. In many other countries, building such
infrastructure on proprietary or not very open systems has shown that technology
and license restrictions come in the way of scaling up economically.

While the report suggests that the Competition Commission of India look into
the matter, I am not in favor of that. The IT industry and the users in India
are smart enough to work this out between themselves, and not get entangled with
inquiry commissions which lead to nothing but delays.

Ibrhim Ahmad