There are no free lunches, they say. But its really not true. Larry Page and Sergey Brin, two Stanford students, are providing free lunch to their customers. From free search engine to free email service on the Internet space, the business model has brought them fame and money and made their companys stock skyrocket on the Wall Street.
Some analysts prefer to call their company Google Inc. as an Internet Powerhouse. And, when the company announced that the web-based mail service named Gmail which is still at beta testing stage would double the inbox storage space to 2GB and further to 10 GB by end of April, it sent the email service providers back to the boardroom.
As the Internet Powerhouse starts driving the email market, the competitors of Google in India have to firm up their strategies. They must decide how they would confront a company which is making anytime and anywhere information access a reality with large mailbox storage facility.
Global players like Yahoo responded by increasing the inbox storage space and Hotmail provided anti-virus protection to all its customers with more value additions to their paid service.
Yahoo has promised to increase the free web email storage space from the existing 250 MB to 2 GB.
For Indian email service providers, it is global competition without any duty borders knocking on their doors. Realising the extent of competition, Rediff.com, which many consider as number one portal of the country, increased the storage space straight from 5MB to 1GB.
Now, Rediff is planning to come out with a slew of paid services which would include a handshake between some Indian mobile service providers and their email subscribers.
Theres an air of apprehension among many analysts as to how regional and national portals will be able to handle the onslaught of the global majors.
But, both Rediff and Sify executives feel that it is too early to push the panic button. Their confidence is based on the fact that as regional players, with more than 95% of its subscribers of Indian origin, they have a natural advantage of being close to the heart and mind of the Indian customers, compared with their global rivals.
Rohit Verma, executive vice president (marketing) of Rediff.com said, We know our customers better than our global players. With new bundle of services catering to our local needs, we are in an advantageous position.
One example of localisation of services is Indiatimes.com offering email facilities in 11 Indian languages.
One of the advantages for the large Indian regional players is that many of their email customers, who also use their portal services, are targeted at local and regional needs.
Speedera India head Abhay Dubey, an Internet based content delivery company thinks that as long as the Indian players provide value-added services with regional features, they would be able to hold on to their clientele.
They will feel the heat of what both Google and Yahoo are doing. For Indian portals, customer-churning could be less if there is a parity of feature functionality with global players, said Mr Dubey.
Sify offers 100 MB mailbox and it has plans to increase the storage capacity whenever there is demand from its customers.
Said Ajay Nambiar, head of consumer channels of Sify, Google and Yahoo, increasing their email storage capacity, will not have much impact on the Indian service providers for the reason that users do not consume more than 20-25% of their 1 GB storage.
But Mr Nambiar also said that Sify is adequately positioned to offer larger space to its users shortly.
Rediffs Mr Verma thinks that consumers have already started using more space with the rise of digital content in the information space.
People have started storing music and photos in their mailbox. We are ready to provide extra storage capacity whenever it is required, said Mr Verma.
The storage cost is going down everyday so we dont feel that it will start pinching us, said Mr Verma.
More than storage cost it is the technology of storing data, use of the disk and tape storage combination and the development of new and innovative customer-friendly options to manage the mailbox are crucial issues that Indian email service providers will face in future, said Mr Pradhan.
The present storage cost, according to Vijay Pradhan, the country manager, Storage Tech India Pvt Ltd, a $2.2 billion US-based company, is anything between $5 and $6 per MB.
Some people associated with the IT industry feel that there will be an immediate shake-up in the industry. But said Mr Verma of Rediff.com, We dont see any of our competitors going out of business. Rather, with the rise of the entry barriers, we may not see any new players in the market.
The surge of demand for free email service is just the tip of a iceberg, feels Kaushik Chandra of PricewaterhouseCoopers (PwC).
With the surge in e-commerce activities, if Indian portals can deliver better services, there is no reason why customers will not visit their sites, shop things and use the mail site to interact with others, said Mr Chandra.
I am hoping this isn't some kind of misunderstanding....
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I dont like to erase nothing.
