Netgear changes gear in India

It has been a decade since Netgear started selling its range of networking products. The company was amongst the first few to adopt outsourcing in a big way, setting up a manufacturing unit in China. Due to its smart outsourcing strategy, it changed the networking products industry, i.e. reduce price to a level, which made it extremely affordable to all.

Yet, Netgear has been a late entrant in this country, just over a year now. And is trying hard to make a headway into the emerging network equipment business in India. The company is launching its latest range of networking products (like Range Max 240 routers) in India and is also firming up its team.

To that end, Ian Mclean, vice president (Asia Pacific), Netgear, had visited India some time back. He spoke at length to Shashwat Chaturvedi from CyberMedia News, detailing the go-to-market strategy and other such challenges to be faced. Excerpts:

Netgear made a foray in the Indian market over a year ago; how has been the response thus far?



The response has been fantastic. We have registered a 350% growth last year. We are make big strides in the Indian market, increasing our presence in Tier 2&3 cities. Our products have been well accepted by the Indian market. We have good traction in the wireless switching and Wi-Fi routers market. Netgear is renowned for its innovative products at cost-effective rates, and we will launch a slew of such products in the coming days.

What are your Indian initiatives and strategies in the coming year?



We want to increase the number of channel partners in India, increase the national coverage. We are focusing on different verticals like insurance, education, banking, manufacturing, for growth. We are also looking at customizing the products specifically suited to the needs of Indian consumers. India is steadily becoming a broadband country and we are looking at taping that opportunity. Netgear is also launching the latest products here like Range Max 240, etc.

You are focused on the SME/SMB segment, but the recent trends in the U.S. markets show a distinct shift of focus to the home users (over 80% sale of Wi-Fi routers was for domestic use, last year). Do you see a similar shift in Indian market as well?



U.S. is a very different ball game all together. I agree that the home user market in U.S. has blossomed into dominance, but when you compare it to other places say for instance in Europe the story is quite different. Take for instance another factor, Cisco's Linksys is the number one player in U.S, while everywhere else Netgear is the dominant player. We certainly are attentive to the needs of home user segment, but are looking at SME segment to drive up the sales for Netgear.

Cisco, 3Com seem to be quite aggressive in Indian of late, how will you counter them?



To say the truth 3Com does not seem to be doing all that great in India. Cisco is our long-term competitor, but at the current moment it more focused on the core enterprise Telco space, whereas Netgear is looking at the SME/SMB segment. So, there is a difference in our focus. The only way we know to beat competition is through innovation and cost benefit, and we will employ the same means in India. For instance Netgear has a target of introducing nearly 20 new products on a quarterly basis. We are also working at developing products for Asian market in Asia itself.

Netgear has been in news for its partnership with Skype for the introduction of Wi-Fi enabled VoIP phones, when will we see that product? And when will it be launched in India?



We will be launching the product soon. Currently it is in the testing phase. The launch will be country specific, taking into factor the ground zero conditions. The phone could be launched in India by the end of April 2006. The only problem is the paucity of Wi-Fi hotspots in the country; there are hardly any hotspots. There are some encouraging signs, like the move by a public sector Telco to introduce hotspots in various places. Also, there could be certain administrative issues as well.

Netgear has a manufacturing base in China, are you looking at India for manufacturing will there be some development carried out of India?



Netgear's philosophy is simple, look at reducing the manufacturing and transfer the benefits to the consumer. We are looking at India, it has got all, skilled labor, etc., but we cannot talk about anything concrete at the moment.