India represents a huge opportunity: Darl McBride

By : |July 19, 2006 0

Bangalore: Headquartered in Lindon, Utah, SCO owns the core UNIX operating
system and is the exclusive licensor to UNIX-based system software providers.
Darl McBride, President and CEO, SCO spells out his vision for India, the
company’s performance in the last two quarters, products and serviced offered,
the emerging trends in enterprise and SMB OS market in the country and also
gives his perspective on BRIC and its future in an interview to AC Ganesh of

What are the factors you took into consideration when choosing India?

We have been doing business in India for a number of years, well before I joined
the company. We were the early birds to set up the operations in India and I
think that it has helped our business there. The I.T. industry in India knows
that we aren’t a start up company that is here today and gone tomorrow. We’ve
been in business for more than two decades and we plan to be in business for
many decades to come. 

Darl McBride, President and CEO, SCO

How are SCO products influencing the Indian market?  

SCO products are reliable, scalable, highly secure and work well especially in
various vertical markets (as mentioned before) and once installed they work for
years and years without interruption and without requiring much service or
support. In a country as large and as vast as India is, I think that it says a
lot that some of the most important institutions (banks, government agencies,
utilities, etc.) depend on our products. 

Elaborate on SCO’s products and services in India?

SCO has had a presence in India & the SE region for more than a decade now
headed by Sanjay Gupta (Country Manager — India & SE Asia). We have a strong
presence in vertical sectors such as banking, finance, government agencies,
utilities and transportation. SCO has a complete range of products and services
available in India through its distributors and partners. The company also has
an engineering center for development and professional services in our New Delhi
offices. Obviously the mobile market in India is huge and we have started
working with service providers and various companies to begin offering mobile
services in a number of regions. So during the past year, we have really
diversified our product offerings from operating systems with UnixWare and
OpenServer to adding mobile services too.  

How has been the performance of SCO in India since its inception here?

India has been a major growth center for the company with a 40 percent increase
in revenues between 2004 and 2005. We expect that revenues will continue to
increase from this region of the world with the high growth of I.T. expenditures
that India is expecting during the next 4-6 years. 

percentage of total revenue for SCO do Indian markets contribute?

We don’t
break out our revenue numbers by countries or region, but typically about 55 per
cent of our revenues come from North America with the rest (45 per cent) of the
revenues coming from outside of the U.S. 

Brief us on SCO’s performance in the last two quarters?

The business has been more challenging than ever, mostly because of the extreme
competition in the OS marketplace. But the opportunities have never been greater
for SCO. A number of large customers have started or finished SCO OpenServer 6
implementations across their enterprise with great results. The company’s new
mobile services business is showing tremendous promise and we are already
participating in a number of pilot projects with companies around the world,
including companies in India. That market is wide open right now and whoever can
deliver the kinds of mobile services that companies and governments are looking
for in the shortest amount of time will win.

Name few customers for SCO in India

Indian Overseas Bank, Dena Bank, UCO Bank, ITI , UBI, The Centre for Railway
Information Systems, Power Grid Corporation of India Ltd, Punjab State
Electrical Board, National Thermal Power Corporation, Haryana Vidyut Prasarnan
Nigam Ltd., and Central Power Research Institute  and many more. 

What is your headcount in India? What kind of a skill set do you look at while

We currently have 9 in sales/presales support and 15+ in engineering and
development and we continue to grow this number. 

Brief us on plans for India in the coming quarters? 

We have been doing a very good job in India and the Southeast Asia region in
terms of revenue growth, new customers, new product launches, etc., and we will
continue to grow the business by bringing new technologies and products to
market, by working with our partners and by providing good support and service
to our customers.

What are the verticals addressed by SCO?

SCO has traditionally been a company that is strong where transaction processing
is important and reliability is of paramount importance, so we address markets
such as retail, banking, finance, hospitality, insurance, pharmacy, utilities,
transportation and government agencies.


What developments are taking place for the Enterprise market and as well as SMBs?

SMBs have incredible opportunities now because technology prices have come down
so low that they can adopt the same kind of software and hardware that only
their bigger competitors could afford a few years ago. So there really is this
leveling affect in terms of competition.  


Is there any way to reduce UNIX server cost for SMBs?

Our company is very focused on the SMB market. This is where most of our
resellers that sell SCO UNIX sell into, so it’s a market that we’re very
familiar with. We have a number of products and solutions that are priced and
targeted specifically for the SMB customer, including SCO OpenServer 6 for Small

Elaborate on marketing strategy and SCO’s engagement in Indian market with ISVs,
channel partners etc?

SCO has a strong presence in banking, finance, government, utilities and
transportation verticals. Within India SCO has direct presence at 4 metros and
works with OEMs , Sis, ISVs/VSPs and solution providers to address customer’s
requirements — we have grown in India year-over-year, signed on new customers,
have conducted a number of corporate events under the leadership of Sanjay Gupta
and are looking forward to ramping up our business as we move forward with the
help of new technologies such as mobility.

With most of the companies engaged in educating the channel partners and
resellers, is SCO also looking at the same to reach out and address them?

SCO is a very channel friendly company and has been recognized by VAR business
and other publications with awards for our channel programs. We believe in
transferring the knowledge to our channel partners to enable them to propose the
solution not the boxes. We have done various consumer specific events and other
activities to introduce new technologies to the market and train our channel
partners so they are ready when they receive customer leads.   

What about the after sale service to the customers? 

SCO has worldwide support services and infrastructure in place and we do provide
services through our trained partners. We have a team in India which can take
care of any special support needs and of course this team is backed up by our
engineering teams around the world. We have a worldwide support infrastructure
in place and provide support ranging from email/fax/telephone through to
enterprise level support, 24 hours a day, 7 days a week.

What is your vision for India?

India represents a huge opportunity because of a number of factors. The
projected revenue growth of the I.T. market in India is the highest in all of
Asia, and outpaces the rest of the world. The Indian government’s plan for I.T.
investment and expansion into more rural areas is also significant. SCO has been
prominent in Indian banking for a number of years and that will continue as bank
modernization continues throughout the country. 

      Throw some
light on emerging trends in Enterprise OS markets?

Probably the biggest trend in the enterprise OS market is around virtualization,
where the underlying OS becomes more and more transparent and multiple operating
systems are able to run on one system. We are already seeing this with some of
our customers. One of our major customers runs a product called Merge with SCO
OpenServer which allows OpenServer to also run Windows applications on the same
system. We anticipate seeing this trend more and more in the years to come. 


perspective on BRIC (Brazil, Russia, India and China) emerging as strong
markets, their strengths and future?

I actually just gave a keynote on this very topic at a trade show in Russia. The
BRIC markets are compelling because they represent a collective population of
2.7 billion people with nearly $16 trillion in purchasing power, and I.T.
spending that will increase 13.9 percent annually to more than $110 billion by
2009. This kind of growth clearly outpaces the rest of the world and these
countries will experience rapid I.T. changes during the next 5-7 years. 


What are
the challenges SCO is facing and how do they plan to tackle it?

We have some very tough competitors in our product categories, with Microsoft
Windows on the one side and Linux on the other. Many customers view Linux as
offering a similar value proposition as UNIX in many respects because, well,
it’s based on UNIX. Added to that is the problem of it being freely
downloadable. How do you compete against free? SCO has had to fight and innovate
every step of the way to show customers that what we offer them is better
supported, more reliable, and of greater value over the long term. 

Who is a
bigger threat – Microsoft or Linux for UNIX?

They are both equally tough competitors for different reasons. Microsoft because
they have so much cash, a strong brand, and they are really good marketers, and
Linux because it is so much like UNIX.


Now more
and more enterprises or developers are going to Linux. How do you plan to bring
them back to UNIX?

Linux has been around since the 90s and we have many customers that have stayed
with SCO on UNIX. So you have to ask yourself why? People don’t move operating
systems because it’s the popular thing to do; especially SCO customers. Many of
these customers have been running SCO UNIX for more than a decade with very
minimal downtime and little maintenance required. Customers just don’t want to
give that up.


is looking at mobile/wireless market. What exactly you are looking at here?
Again, don’t you think you are a late entrant here?

The most lucrative non-hardware category for the mobile and wireless device
market in recent years has been ringtones. Beyond ringtones and e-mail services,
there are few applications or services that businesses have adopted en masse.
From our point of view, mobile services is a market that is wide open and
whoever can deliver the right applications and services with the speed to market
and quality that is required will win. We’ve been preparing these services for
more than two years, and so far, I like what I see.

So far we’ve delivered some very unique communications tools with our Me Inc.
mobile services product line called Shout and Vote, and we seen great adoption
of these services from a number of verticals including sports franchises,
universities, realtors, retailers, and many other industries. In addition to
this, we have our EdgeClick mobile services platform that allows developers to
use our EdgeBuilder software development tools to create custom mobile services
for any business or organization. We’re seeing a lot of interest in this area
with customers implementing a variety of unique and powerful mobile services.   

Which are the potential
markets you are targeting in the next few quarters?

We will continue to target the
markets where we are strong as well as enter into new markets with our mobile
services where we’ve never had a presence before. Companies and government
agencies are looking at what we are doing in the mobile services space and I
think that we are really turning some people’s heads. They are really surprised
at the capabilities that we are bringing to the market. 

Elaborate on your
partnership with MySQL?

The company entered into a
mutual agreement with MySQL last year. They saw our customer base as an
important one to them and MySQL was not yet certified on SCO UNIX platforms. So
we had a number of meetings and worked out an arrangement where we would work
together to get MySQL certified on the SCO UNIX platform and work together to
jointly support our customers, participate in joint sales calls, marketing
opportunities, etc. 

Brief us on your latest
offering mobile digital services?

In September 2005, after many
years of development work and using the assets that we have in-house, we
introduced what we call Me Inc. mobile services. These are services that
initially were available on the Palm Treo platform, but we are now extending
this out to Windows Mobile devices, simple every day cell phones and even
personal computers. Our initial services, called Me Inc. Shout and Vote
services, are really powerful at helping people communicate quickly and gather
opinions among friends, co-workers, and basically any group that is central to
someone’s life. I can be sitting any where in the world with my Palm Treo 700,
quickly record an audio message using the Me Inc. Shout service and send it to
all of my employees with the click of a button. That’s really powerful and
quick, and that’s the kind of capability that we’re giving to all of our mobile
customers. It’s also a nice personal touch because people aren’t just reading an
e-mail. They are alerted that they have received a Shout message from me and
then they hear my voice as I share my message with them.

Beyond the Me Inc. services,
we’re also providing resellers and developers with tools to quickly create
mobile services of their own that they can then sell and provide to their
customers. We’ve already seen some early success with this and we hope to
announce a very large customer in India that has begun using these mobile
services very soon.

The other strength of our
mobile services is that we incorporate a very powerful backend technology called
the Edge Processor. The Edge Processor is the service engine behind our mobile
services. It allows our customers to record a message and then quickly send it
out to any thousands of individuals. We’ve already had customers using this to
send Shout messages to more than 38,000 registered customers at once. In fact,
the Edge Processor is so powerful that we haven’t found the threshold yet for
how many customers we can service at once. So we can handle really large,
enterprise demands with this kind of technology.  

What are the advantages of
having UNIX or MeInc. over similar products in the market?

All of our products have very
unique advantages for different reasons. Our UNIX products really set themselves
apart from other products on the market because of their reliability, security,
and performance. Few other products on the market offer those advantages on the
Intel hardware platform like we do. The Me Inc. products provide us different
advantages because no one else is providing the kind of service that we provide.
It’s unique. It’s also a very fast sales cycle. People see the technology and
how it can be applied to their business and they typically say, “Wow. I want
that.” It doesn’t take weeks or months to deploy. It’s a very fast sell because
customers quickly realize the benefits of using it. 

How effective is MeInc.
going to be, when similar products have failed in securing huge market share? 

Most companies that have tried
to do what we’re doing have failed because they rely on the phone to do all of
the work. If you only rely on the phone, then the application or service
typically becomes big, cumbersome and slow. We believe we have the right set up
to keep the mobile service small and agile on the phone, while providing big
benefits to customers by combining our mobile service with our backend Edge
Processor technology. I don’t believe that anyone has implemented this the way
that we have.

What are the other trends
in Enterprise OS market?

Virtualization is coming on
strong and of course all of the big OS vendors are taking advantage of 64-bit
technology and multi-core processors now.

Which are the products
lined up for further release? 

Without getting into
specifics, you’ll continue to see us update our OpenServer and UnixWare products
while also rolling out new mobile services in the coming months.

What has been SCO’s
performance in last couple of quarters and brief us on the plans

for the next two quarters?

The business has been
challenging, mainly in the server OS side of our business, but the company is
starting to scale up on the mobile services side of our business. We will
continue to maintain and update our UNIX business and focus on growth
opportunities in our mobile services business. 

What is your global
headcount and are you planning to ramp up?

The current number is 191 and
that number has been ramping up and I expect that it will continue to grow if
our mobile services business continues to grow like we expect it to.

Which of the products and
solutions contribute the most to SCO’s revenues?

Clearly most of our revenues
come from the sales of our SCO OpenServer and UnixWare product lines, but we are
ramping up quickly in the mobile services area.

© Ciol Bureau

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