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“Smartphones and Cloud Apps is going to be an important trend

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DQI Bureau
New Update

How would you describe cloud computing technology and what significant changes has it brought about in the Indian IT industry?

Today, people want to turn their focus completely on running their business, not their IT. Cloud-based applications takes the burden of hosting, managing, maintaining and supporting applications away from businesses, allowing them to focus on what they do best. Cloud application vendors are better experienced in hosting scalable, redundant and secure systems than most of the businesses. The economies of scale also give better cost structure for businesses instead of hosting these applications in-house. This availability of lower cost software allows many businesses adopt cloud applications to improve their business efficiency.

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The cloud computing market in India is burgeoning, what is the scope that you see for yourself? What has been the reason for some of the markets remaining untapped, namely SMBs?

India is definitely one of the fastest growing markets for Zoho, and we evaluate ourselves on a monthly basis. However, IT adoption is still in its early stages, particularly cloud applications that are dependent on internet adoption, which still has some way to go. Assuming internet penetration, next challenge is going to be reachable. Zoho is trying to tap the SMB market through various channels.

For example, TATA Communications is our OEM Partner and they are delivering some of our applications, under a white label. We are also partnering with some local companies like resellers and system integrators - we signed up with Ingram Micro recently - because an SME is going to trust his local IT vendor more. Zoho has the technology and tools. These larger companies have the reach. We partner to take advantage of each other's strengths.

Currently, Zoho.com is focusing on SMBs in the metros in India, where internet penetration is higher than the non-metros.

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Why Zoho did not sell-out to any other large company? Aren't mergers and acquisitions the 'in-thing'?

We are not another 'built-to-flip' company. We have had many offers in our 16 year history of doing business. That doesn't attract us. We believe in creating good products and building a long-term business, and have fun doing it. In other words, we are in the business to run our business, not run away from it. This long-term focus explains why we haven't accepted any external investment. We never subscribed to the 'built-to-flip' model, which is pretty common nowadays...call us old fashioned.

Zoho competes head-on with Salesforce, Google and Microsoft, how would you describe the dynamics of the competition?

Zoho competes with many vendors. That is due to the broad portfolio of products we offer. We have the broadest set of online business applications today, serving the SMB market. Our offerings (Email, Office Suite, Website Creation, Document Management etc), overlaps with Google's 10 apps. But we have 15 other business applications (like Accounting, HR, Business Intelligence, Customer Support, CRM and more) that Google doesn't offer. Same can be said about our competition with Salesforce or Microsoft. We have a much broader portfolio of applications compared to competition.

That doesn't mean we don't work with competition. Zoho is one of the largest software providers to Google Apps. We integrated over 15 business applications within the Google Apps Marketplace and serve Google's customers. It is ‘coopetition'.

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Why an Indian SME focused strategy is a must for every CEO?

There are two sides to this story. While we all are aware that the Indian SMB market is growing day by day, different companies are reacting differently. A company's strategy should depend on their business model and the focus. Companies like SAP, NetSuite and other vendors are doing just fine focusing on the Enterprises and not worrying about SMBs.

But at Zoho, we believe in bottom-up approach. We serve small businesses first and eventually bubble up servicing larger companies. We like the SMB market better as there are more SMBs than larger companies in the world. While it has its own set of challenges (like reaching these SMBs is tough), the volume make this interesting.

What are your plans for the company in the new year and the also the Indian market?

There are going to be two focus areas - products and external reach. On the product side, the focus is going to be less on launching new products and more on integrations. With over 25 apps, we have most of the products SMBs need today. Our focus is going to be on integration. You will see us launching several unique integrations next year.

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On external reach, we are expanding on sales and marketing along with strategic partnerships that will help us reach wider audience.

What would the new year roll in?

Mobile. That is going to be the future...and big, especially in India where there are 10x more mobile devices than computers. That is another area that is of high priority for Zoho and we will be launching many mobile apps in 2013.

Smartphones and Cloud Apps is going to be an important trend moving forward. Given the limited resources on mobile devices, they will be powered by powerful cloud infrastructure/apps. Mobile & Cloud application waves are tied together and it will explode. We are already seeing this in countries with higher smartphone adoption. Smartphone adoption in India is still low (4%), but as it increases, it is going to change the industry.

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