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Kiran Karnik

President | 30 Sep 2002

To increase the penetration of Internet in India, besides computers, we should use the existing tools to access web. You've got 40 millions TV sets (with cable connections) in India and even if 25% of them are utilized for accessing web then straightaway you get 10 millions (users) added.

With the untimely demise of Dewang Mehta last year in Sydney, it was said that the torchbearer of the IT revolution in India has gone away. But he was succeeded by a person who is held in equally high esteem. Kiran Karnik. In the last one year, Karnik has been instrumental in building brand equity for the Indian software and service industry globally and broadened NASSCOM's horizon.

Karnik in his last stint was the MD at Discovery Networks in India from 1995 - 2001, spearheading the launch of Discovery Channel in South Asia in 1995 and Animal Planet in 1999. Prior to this, he had a long stint of over 20 years with the Indian Space Research Organization (ISRO) holding various positions related to the conception, planning and implementation of applications of space technology, focussing especially on the use of communications for development.

In an exclusive interview with Akshay Bhatnagar of, Kiran Karnik shares his vision about the growth of IT especially Internet in India and its benefits to the media industry.

Q. You are going to complete one year at NASSCOM soon. How has been the journey so far?

It's been very interesting journey. Before I joined on 15th September, there was a slow down in the US economy. Besides that Sept. 11 events had just happened. The last one-year has been very challenging. But that's made it more interesting and exciting! I see a lot of changes beginning to happen in the industry within India and outside.

Q. Ok. How can we facilitate the growth of Internet in India?

In my view, we need to work in two directions simultaneously. One is, we need to see how we can reduce the cost of computers and Internet access through computers in a big way. We must realize that it's not a consumer item but a utility and information tool. So we have to lower down the tax and excise rates for this.

Second thing is to increase the penetration of Internet in India, besides computers, we should use the existing tools to access web. For example, you've got 40 millions TV sets (with cable connections) in India, and even if 25% of them are utilized for accessing web then straightaway you get 10 millions (users) added. If you have CAS (conditional access system) coming in than straightaway you have some kind of a set-top box to attach and accessing Internet is very easy through that by incurring an additional cost of say just Rs.1,000. So there has to be some policy framework from the government to really push this.

Q. How can the media industry benefit from adopting information technology especially the Internet?

The direct way is to use the Internet to create more interactive programmes. We have seen around the world that with such kind of programmes, the viewers interest increases, audience is increased and there is lot more excitement. So lot more revenues also comes in.

Secondly, there could be indirect gains in revenue by providing some special kind of services added on through the net. And these could range all the way from just interactive programmes to using the net for e-commerce also. The example could be when you have popular serials on air and somebody likes the dress which the popular actress is wearing, you can just click on that and quickly get all the details like where it can be bought, how much it cost, what sizes available, etc. This could be one kind of service. There is one more opportunity which seems very exciting to me. We can try to create a strong animation industry in the country. Today, we are doing quite well in animation. The major animation players are countries like Canada and Australia and now they are outsourcing to countries like Taiwan and Philippines which have far lower skills base than ours. India would be a great place for them as we not only has strong skills in IT that are very necessary for animation but we also have very strong creative skills. And animation is really a marriage of these two.

And as much promising as animation is e-games. And that is a huge area. The worldwide market for games is around $15 billion. And we have done nothing about it. And that's an area where we need to push ahead.

Q. If these sectors have such huge potential why has the industry not explored them so far?

See, we can get into it straightaway but there are certain entry barriers. So it involves somebody who has to take large risks and sink in lot of money. Of course, there are easier entries also but typically there are very few people in this business worldwide. There are not more than 5-6 major players in the game. So you have to break in and really get into the big league. But there are easier ways to start with. Doesn't sound very nice though, but you can be a sub-contractor to one of them. You can provide your services and I feel there is nothing bad with that as the whole IT growth in India started this way. We started just by providing people. Later on, we graduated to services. And its only now that we are moving on to products and intellectual properties. And I think we can do the same in animation also. Initially, we just provide skills as there are so many people who are capable in artistic and aesthetic skills and also know computers. They do the kind of work people want abroad. But inspite of the potential we have not done much about it.

Q. So what efforts have been taken by NASSCOM to tap these much neglected areas?

About 6 months back, FICCI and NASSCOM have come together. We have created a partnership with FICCI Entertainment Committee so that we can bring in venture funding in this area. This is an effort to tie-up with those who can bring in the funds here (that's FICCI) and the IT industry (that's NASSCOM). And in the process, we have created an e- entertainment alliance. We have had lot of discussions and are trying to identify areas in which we need to work. We looked at things like human resource shortage, the fact that there are inadequate training facilities and see how we can grow the market.

Q. Do you really think that's possible in a country like India?

It's very difficult and the way we are moving, it's next to impossible. The convergence bill has been talked for years, some draft was done and placed in parliament a year ago. It's still there and nothing has been done. In these times, technology doesn't wait. It just moves on!

The more practical way is to try and ensure that there is a strong good regulator to protect the consumer's interest. Consumers frankly are in great danger. For example, I've experienced the problems myself at home! There is just one cable operator in our area. If you complain about the service he tells you straightaway that you just disconnect. Because he knows that you can't, as you have nowhere else to go. And I've no recourse. Even consumer courts are not actually active in this as there is no licensing, no regulation, no minimum standards, there is nothing which is required of him(cable operator). And he's got virtual monopoly. The government has said anybody can come in theory but there is nothing in practise. So we've created loads of monopolies.

Q. How can advertising industry take full advantage of information technology?

I think advertisers can use IT as a means to deliver advertising in a more stronger manner. You can have convergence of television and web. But there is a barrier in that as the penetration of computers and Internet in India is very low. So unless you push that ahead, it won't work.

See it from the point of view of the advertisers. If he wants to reach the whole country, he can use TV and reach probably 80-90 millions households. But the same thing if he wish to do through a computer, then maximum numbers of computers are 7-8 millions only. Even that number is doubtful. And even they are also not totally in households because as these numbers includes computers that are in offices, shops and so on. Actual household access is very low.

Secondly, computer is a single person medium where as TV is a multiple person medium. So there is a huge difference! So we really need to push in for more computers.

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