IBM may bring Watson supercomputer to India soon: Vanitha Narayanan

In her first interaction with the media after taking over as managing director of IBM’s Indian operations in January, Vanitha Narayanan said on Tuesday that Watson would play a crucial role in IBM’s India operations in the near future.

“One application of Watson is in medical schools," said Narayanan, who oversees IBM’s business in other parts of South Asia besides India. “You’ll also have two or three different applications of Watson... We will do that in India as much as anywhere else, in terms of getting talent and expertise in a broader based manner… So we will work with clients domestically to develop local expertise."

“Will Watson play a role in India? Absolutely. In what shape, what form, where we go from now—that will become clearer as we go forward," said Narayanan, adding that Watson was “very resource-intensive".

Globally, IBM has made a big push to commercialize Watson, which once famously defeated the human winners of the US game show Jeopardy, and apply its services to any industry, especially in areas such as retail, banking, insurance and telecommunications.

Armonk, New York-based IBM already has set up a team of software developers for Watson in India.

Narayanan also said the company would focus on growing both organically and through acquisitions in cloud computing and analytics and continue to make a push in the area of automation technology for its wide range of services.

“Acquisitions are as relevant today if not more, whether it’s cloud, security, analytics—across the board," said Narayanan, citing IBM’s recent acquisition of SoftLayer Technologies Inc. as part of its efforts to bolster its footprint in cloud computing storage.

Narayanan, IBM India’s first woman chief, took over from company veteran Shanker Annaswamy, IBM’s longest serving head of India operations. Annaswamy took over in 2004 and led IBM’s India operations to more than $2 billion in local revenue with a more than 150,000-plus strong workforce in the country, according to industry estimates.

IBM’s India operations now account for about $3 billion in revenue, including exports, according to industry estimates. IBM’s 2012 revenue stood at $104.5 billion.

“We have done automation for a very long time. It is something we do across the board as it gives us a competitive advantage—in terms of cost, time and effectiveness," Narayanan said.

She also said the company had expanded its client base in the country’s banking and financial services sector over the last decade, helping it stay competitive against local rivals such as TCS and Infosys Ltd.

“If you go back about 10 years ago, we were not doing that much work with the banks in the country—the BFSI (banking, financial services and insurance) segment. We’re doing a lot more work with them now—in the traditional and non-traditional areas," she said.

Narayanan is heading IBM’s India operations at a time when the company faces the challenges of retaining and winning large outsourcing contracts and fending off rivals such as Accenture and TCS, according to experts tracking the company.

“Competing in the Indian market is a tough one for IBM," said Jim Longwood, research vice-president at technology researcher Gartner Inc. “The market is a lot more mature and competitive than it used to be."

Earlier in August, Mint reported that IBM was attempting to save its biggest outsourcing contract in India with Bharti Airtel Ltd, citing three people familiar with the matter who requested anonymity.

IBM gets about $250 million in annual revenue as part of the $2-billion contract for managing telecom networks, desktops and different software applications.

“Indian providers like TCS and HCL are also much more aggressive and end up being much more flexible from a risk sharing point of view when IBM continues to push engagement models that were successful in the past, but are too rigid and tend to move a large portion if not all the risk to the client side," Forrester Research analysts Fred Giron and Hansa Iyengar said in an email response.

“To a large extent, labour arbitrage is one of the most key factors that helps IBM meet the price competition from Indian vendors," Giron and Iyengar said.

India still continues to produce a huge number of engineering and technology graduates “who can be readily assimilated into the workforce with minimal training", they wrote.