Blue Ocean: Cost & Differentiation focus in Red waters

MTNL's new move could just break the clutter in the PC market. If you happen to be an MTNL customer, you will soon be able to get a PC for as low as Rs 4,500. To top it up, this PC, which MTNL will offer in partnership with Chennai-based Novatium comes bundled with an internet connection for a small monthly fee. Communication and IT minister A Raja is slated to launch the low cost PC in Delhi on Monday. This computer, called netPC by Novatium, is a no frills device, this means, most of the common hardware that you find on any normal PC is absent here.

The terminals will be connected to a centralised server in the locality by MTNL and provide it with the internet service. The PC which looks and functions like any other desktop does not have a regular CPU or any storage devices. All applications, including the storage of data of all customers are done by the centralised server in the locality. A similar project undertaken by Novatium in a south Chennai locality provided all users with 2GB of remote storage space on a central server. With regard browsing the internet, common problems like the viruses, installation of different security software does not occur since connectivity to the World Wide Web is remotely managed by Novatium.

Put simply, Novatium and MTNL will sell computing as a service against the traditional model where the customer buys the device and then takes a connection from a telecom company or internet service provider to access the net. The netPC’s advantage is that its customers do not have to face the challenges associated with a regular PC. The USP for this model is the low cost of ownership, low maintenance and only server end system upgrades that keep obsolescence at bay.

Customers also have the choice to use either Windows or the Linux operating systems. Since the entire concept is routed through a centralised server, customers are saved the hassles of hardware and software costs as well as upgrades as these tasks are carried out centrally.

This model is totally new and never been tried. A good thing to note here that core here might now be the desktop but the service provided. If this model works out the whole idea of a desktop might go for a toss as the storage space is completely out of picture. But privacy and integration might be issues. So guys do you think its an apt example of blue ocean in red seas?

Source: Economic Times dated 24th sep 2007