Dell takes on Educomp in education

Dell Inc, the world’s third-largest PC maker with annual revenues of more than $60 billion (Rs 2.8 lakh crore), has announced its entry into the bustling education solutions market in the country.

The company, which announced that its India revenues crossed $1 billion last week, will tie up with content providers to offer full scale “digital classroom” solutions in the country, competing with the likes of Educomp, Everonn and NIIT.

“We want to be a one-stop-shop for schools,” says Kriti Kapoor Dell’s director of solutions marketing for public sector in Asia Pacific and Japan. Dell has been in the business of ‘connected’ or ‘intelligent’ classrooms for close to a decade, primarily in the US. Over the last several years, it has expanded into eight new markets, including China in 2009.

While the pure services market is difficult to estimate due to the high percentage of equipment sales mixed in the revenues of the companies, it is expected to be worth thousands of crores of rupees a year, including equipment costs.

It also ties in with Dell’s corporate strategy of transitioning from just a seller of equipment to a ‘value added’ seller of equipment that provides services as well.

In India, however, it faces many challenges, including a 94% marketshare for the government in school education and established competitors like Educomp Solutions and NIIT Ltd. Out of the nearly 1 million (10 lakh) schools in India, only around 60,000 are estimated to be in the non-government segment. The 94% under government control cannot support the kind of ‘connected classroom’ that Dell envisions, though the company is trying to sell very basic versions as well.

For the present, only around half of the state governments have even initiated digitalisation of the schools and even there, the proportion of schools touched by digital technology is only around in the single digit percentages, says a competitor to Dell. Nearly all the programmes have been for setting up of dedicated computer labs, while states like Assam are now going in for dedicated ‘chemistry’ or ‘match’ learning rooms which have computer and other equipment to help students learn.

Perhaps in anticipation, Dell is offering a starting package that consists of just a projector, a tablet PC for the teacher and a touch-sensitive white-board costing just $5,000 (Rs 1.4 lakh) per classroom. In addition, schools can purchase laptops for each student and a mobile wireless networking-cum-docking station. The netbook-like laptops cost between Rs 18,000 and Rs 30,000 each and are aimed at the private schools.

Dell also has a huge disadvantage compared with its established competitors —- it has practically no software or content of its own, while others such as Everonn and Educomp have a rich repository of syllabus-based audio, video and text material. Indeed, the first demonstration by Dell was enabled by a classroom software from one of its competitors.

Dell says it will partner with its competitors to secure content before offering the entire package as a solution to schools.