Computer educational institutes begin to feel the ‘pinch’

CHENNAI: With the US downturn pervading all sectors, the IT training-segment

in India has begun to feel its impact. Experts have forecast the sector, which

had been growing by a robust 30-35 per cent for the past five years, to now

stabilize with a growth rate of around 25-30 per cent, in the next couple of

years.

Cyber News Service caught up with SSI Education CEO, BG Menon, the third

largest software education company in India after NIIT and Aptech, to find out

whether the lull had been intensified with the slowdown in the US and whether

training institutes have started feeling the 'heat'. SSI, along with NIIT and

Aptech, account for over 50 per cent of the approximately Rs 2,500 crore

computer training industry in India.

Has the downturn in the US affected the IT education industry in India?



I think the media has gone overboard with its emphasis on the US slowdown

and the benched IT professionals. Graduates going to the US after a basic course

in software development and earning something between $5000 and $7000 per month

was never meant to be a permanent feature. Like the dot-com bubble, this too had

to burst.

There is no doubt that IT and IT industry is here to stay. But people who

take IT seriously need to take a holistic view and equip themselves with

multiple skill sets and look at sustainable businesses and not ephemeral ones

that are bound to disappear.

The media hype around the slowdown has made students and parents,

apprehensive of this field. They are now adopting a 'wait and watch' attitude.

Though the number of people looking for IT courses hasn't dropped, converting

these numbers, into registered students has become difficult.

Now even parents are a little hesitant to get their wards admitted to IT

courses. However, the reality is that India needs software developers. And that it is a hub for outsourcing for the US and European markets. When offshore development happens in India in a big manner, the demand for IT professionals would also go up.

I don't think we should restrict ourselves to H1B visa limit. There are

opportunities in offshore software development and I think this model is going

to last for the next few years. After all, there has been no fall in demand for

IT professionals in India. This quarter witnessed more recruitment of IT

professionals in India.

Has the demand for any professional courses gone down?



Inquiries for long term courses, which are for the professionals, have gone

down. But contrary to popular conception, short-term courses are still in big

demand, probably due to the inexpensive nature of such courses.

The number of students opting for Java courses has come down sharply. That

might be a reaction to the dot-com bubble burst. But technology-related courses

such as Oracle, ASP, and XML are still popular and may soon replace them. Java

is not completely out as it is a strong platform and a replacement for it is not

in sight though C# and .NET have come into the market.

Has the downturn also had an impact on SSI?



Out profits are fallen by 10 per cent than the last quarter, while revenue

generated was to the tune of Rs 56.6 crore in the Jan-March quarter as against

Rs 63.4 crore in the Oct-Dec quarter. The July-Sept quarter recorded Rs 59 crore.

This is in contrast to Rs 131 crore that was recorded last fiscal.

There is a continued demand for IT training centers in the market. In the

last quarter, we had signed up 161 franchisees, which would become operational

in another three to six months. In the last quarter, we nearly 58,000 students

enrolled in our institutes.

What do you think about the IT Ministry's move to push the Department of

Electronics Accreditation (DOEACC) scheme?



The critical aspect about IT education is that it changes at a very fast

pace. And the private sector has made it big here because they could keep up

with the changes in the sector, make quick decisions and implement them fast

unlike a regular set up like a university or any other government institution.

A good IT training institute needs two elements- good content and good

faculty. The quality of the education imparted is of what is important and not

the certificates won by the institute. This is so because, the

employer would be looking only at whether the candidate is capable of delivering

the goods. If government certification was everything, then CMC should be ruling the roost.