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TCS launches IT services for SMEs, eyes $1-bn revenue from cloud computing

Christened 'iON', the package will enable the fledgling small-and-medium enterprises access world-class IT services at virtually zero capital expenditure.

twitter-logoPTI | February 16, 2011 | Updated 13:44 IST

The country's largest software services company Tata Consultancy Services (TCS) on Tuesday commercially launched integrated IT services for SMEs that use affordable cloud computing model, and said that it expects a revenue of $1 billion from the segment in the next five years.

Christened 'iON', the package will enable the fledgling small-and-medium enterprises (SMEs) access world-class IT services at virtually zero capital expenditure.

It will also keep them at pace with the ever-changing technologies at no additional cost and make the best of manpower available to clients, TCS Chief Executive Officer and Managing Director, N Chandrasekaran, told reporters here.

For the offering, which TCS claims is the first such by any vendor worldwide, customers will be charged on pay-per-use basis, he said, adding that the company is targeting the services at companies with annual revenues of Rs 10-500 crore.

IT companies, including TCS, have till now been targeting large corporations and offering custom solutions.

"We have been running a pilot of our cloud computing services for one-year at 130 companies. Right now, the contribution of SMBs in our total revenues is negligible but in next five-years we expect to garner $1 billion from this segment with the help of these services," Chandrasekaran said.

TCS Chairman Ratan Tata said at the launch that IT companies have ignored the all powerful SMEs which contribute over 45 per cent to the country's GDP and assured that his company's solution will help such units implement IT in their working without much efforts.

"The system will modify itself...you will be with the technological changes," Tata said, addressing an audience comprising of SMEs.

Chandrasekaran said TCS has observed that worldwide spending of SMBs on information and communication technology has been growing at three times the pace compared to large companies.

As a part of iON, TCS will provide everything to its customers right from the level of hardware, software and even network solutions, which will include devices and services for enabling connectivity of its customers with cloud platform.

It will primarily sell the product in India to start with and will gradually start selling the solution in other geographies, Chandrasekaran said, adding that 80 companies have been appointed as franchisees to sell the product to companies across the country.

"Our sales force will not be involved in selling the product," he said.

Manufacturing, wellness, education, retail and professional services will be the sectors within SMEs which the company is targeting for the services while the pricing will vary on a case-to-case basis, Chandrasekaran said. He added that the pilot project has helped it evolve 2-3 pricing models.

A typical contract with a customer will be for three-years and the company is still thinking about the exact exit package, he said, clarifying that all of the customer's data will be given back to him.

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