New Delhi: Mumbai-based Shawman Software Pvt. Ltd, a company that focuses on clients in the leisure, hospitality and retail industries, has developed an application for restaurant waiters to take down food orders on a pocket computer and relay them straight to the kitchen.
India edge: Oracle headquarters in Redwood City, California. The company has 436 partners in India: ISVs, value-added distributors, system integrators, consulting bodiess and resellers that drive 80% of its business.
Waiters at 45 restaurants run by the Taj group of hotels now use the application, built on Microsoft Corp.’s Windows platform. “Microsoft requires someone to sell for them,” said Jimmy Shaw, chief executive of Shawman. “Though we have domain expertise, we are not a known name and need an association with a brand like Microsoft to sell our products. The fit is good for both of us.”
As competition increases in the software and services sector, Shawman and other so-called independent software vendors (ISVs) are trying to expand their business through applications built on the platforms of firms such as Microsoft, International Business Machines Corp., Oracle Corp. and SAP AG.
Shawman has developed about a dozen applications powered by Microsoft technology since entering into an ISV agreement with the world’s biggest software firm in mid-2007. The ITC group uses a software developed by the firm to manage its spas.
For ISVs, such tie-ups ensure financial backing, access to clients, a larger customer base and the first right to test a new product of global technology partners, as well as discounts for using their platform to develop applications. For the large firms, it saves the cost of developing small, niche applications and helps them build local partner networks.
“It is win-win for both the parties. ...the ISV base is still growing at a much faster rate (than pure tech service firms) and will continue so for the next five years,” said Ashish Raina, principal research analyst at research and advisory firm Gartner Inc.’s Mumbai office. “Innovation and niche services, and products by small and emerging firms will be the growth driver for the ISV market in India.”
Conacent Consulting Pvt. Ltd, a three-year-old Kolkata firm, makes custom-developed application software on Oracle’s database and business software technology, which drives around 95% of its business. The Rs3-crore firm has 15 clients in the engineering, industrial manufacturing, and food and beverages sectors, and expects to triple its business in three years.
“Our partnership with Oracle gives our products credibility and access to their technology at a discount,” said Jaydeep Mukherjee, chief executive officer at Conacent.
In India, Oracle has 436 partners, including ISVs, value-added distributors, system integrators, consulting organisations and resellers that drive 80% of its business. The standard membership fee to join the network is $2,000 (Rs85,000).
Chennai-based Laser Soft Infosystems Ltd, with sales at between Rs30 crore and Rs35 crore, is an application software development company focused on the banking and financial services sector. The firm develops applications on platforms, including Oracle’s and IBM’s. Laser Soft gets a discount of 30-40% on platform costs from such vendors, said Gopal Rathnam, head of marketing, “but we moved to their platforms to use their rich features to develop our products, thereby benefiting our customers”.
Laser Soft’s core banking solution on Oracle technology went live at Catholic Syrian Bank Ltd early in April. The bank plans to take it to all its 350 offices by March 2009. The cost of deployment: up to Rs35 crore, of which the software costs just Rs4-5 crore.
IBM and SAP have also stepped up efforts to develop an ISV network in India. In 2007 alone, applications developed by more than 100 small software vendors were tested on the IBM system.
SAP established a fund in mid-2006 to invest in companies building solutions on its platform. The fund has minority stakes in ArisGlobal Holdings Llc., Questra Corp. and Visiprise Inc. Last year, SAP bought Hyderabad’s Yasu Technologies Pvt. Ltd, a firm that developed business rules management technology, which are used as the basic rules for business process management systems.
Tech research firm International Data Corp. (IDC) flagged this acquisition in a recent report. Apart from Yasu, “we found firms like Tally, OnMobile, Crane Software, among others, were top examples”, said Praveen Sengar, manager of software services research at IDC and the lead author of the report. These firms “fulfil gaps at larger vendors by addressing niches”, he said. SAP’s partners in India have developed more than 70 solutions.
“As more and more innovation is driven out of India, ISVs are becoming critical to our business,” said Tarun Gulati, general manager of the so-called developer and platform evangelism team at Microsoft India. “We have stepped up our efforts in engaging with ISVs as a substantial portion of our business comes from them.” Microsoft has nearly 3,100 ISVs, of which 100 operate globally.
For IBM, the big value an ISV brings is reach. “India is a huge market and any single organization cannot have enough reach or domain expertise to be able to offer technological innovations to all,” said Jyoti Satyanathan, vice-president of the platform business and software technology group at IBM India.