Zylog to offer Internet voice services

CHENNAI, INDIA: City-based software services company Zylog Systems Ltd will soon offer voice over Internet protocol (VOIP) services by partnering with a leading US company.

'We are contemplating to become a service provider and focus on the retail segment. The current players are catering to the enterprise segment,' Sudarshan Venkatraman, chairman and CEO of the company, told IANS.

Agreeing that the dynamics of a service provider was different from being a services and solutions provider, he said: "Marketing is not new to us. We also market couple of software products and solutions. We understand VOIP technology and are confident of our success as a service provider."

The company is planning an investment of around $3.5 million for the project.

Zylog Systems might go in for a 49:51 joint venture with an American company whose name Venkatraman declined to reveal.

Venkatraman did not foresee any threat from existing telecom service providers.

"It is always the small players who would first get into any new technology or service and create the market.

He said the existing telecom players have no incentive to get into retail VOIP, as it would make their current infrastructure redundant.

It would happen only when the Indian government allowed Internet telephony within India, he said.

According to Venkatraman, Zylog was targeting mobile phone users because many handsets would soon become VOIP enabled.

Meanwhile, Zylog is expanding its existing business-software services and solutions for banking, financial services and insurance, telecom, retail, pharmaceutical, manufacturing and others.

In the Asian Pacific region, the company would focus on banking. In Europe, its stress would be on telecom and insurance sectors.

According to S.P. Srihari, finance controller, the company gets 65 percent of its revenue from software services and the balance from selling solutions.

Presently 98 percent of its Rs.4.04-billion ($102 million) revenue is from North America and the balance two percent is shared between Europe and Asia-Pacific. "The rupee appreciation against the US dollar affected our income only to the extent of 5 percent. By 2010, the share of revenue from Europe and Asia Pacific regions would go up to 5 percent," said Srihari.

Queried about the company's plans to build a development centre at Siruseri near Chennai, Srihari said: "We just opened one centre near Chennai. The Siruseri centre would depend on the central government's decision on extending the Software Technology Park of India (STPI) tax sop scheme."

He said if the STPI scheme was not extended then the firm might set up the new centre in a special economic zone.

Source: Agencies