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‘It’s A Global Brand Based In India’

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Online tech support service is a rare example of a 24x7 branded IT services firm from India catering to customers in the US, Australia, Canada and now also in West Asia, with a model that some of India's largest ITeS firms will give an arm and a leg to own. At its Gurgaon headquarters, customer support staff do not hide behind American aliases. Rather, they answer calls in Indian names. They deliver the service not as an American back office, but as an Indian service — and charge the customers in US dollars. Growing at 300 per cent year-on-year, iYogi has hit $100 million in revenues in five years of operations ending 2011, and is still growing at 15 per cent month on month. Uday Challu and Vishal Dhar founded as your computer's online doctor in 2006. But today, the service caters to anything that has an IP address. Its 2,700-odd staff manage close to 2.2 million devices at subscribers' homes remotely from Gurgaon (only four employees are based in the US). These could range from archaic Windows 98 computers to the latest Windows 7, Apple laptops to Android phones, printers, digital cameras, routers, set-top boxes and even smart TVs. There are close to 304 kinds of devices and applications for which iYogi offers online tech support at anything between $20 and $300 per annum. At least 85 per cent of its business comes direct from consumers, the rest from partners such as Netgear and CA Technologies. iYogi's biggest rival Geek Squad — started by retail chain BestBuy — is already a $2.2-billion company. iYogi believes it is in a $30-35 billion sweetspot, roughly equivalent to the unserviced demand for online tech support. BW's Rajeev Dubey met Uday Challu and Vishal Dhar at iYogi's Gurgaon headquarters to ask how will the company keep itself ahead of the curve.

What  is the genesis of iYogi?
I had started a physical tech support company in 1985 with engineers going to people's homes, and I could not scale it. I always knew the opportunity was there. In the enterprise space there were huge companies from IBM to EDS to Dell Perot, which provide consumer services to other smaller enterprises. There is nothing in the consumer space. There is no platform and there is no tech support brand. Geek Squad was there but hidden in the BestBuy business so I did not know them. Just when we started thinking about the company, BestBuy announced they are starting Geek Squad two years ahead of us.

When are you launching in India?
We have been working on our launch in India for a year-and-a-half now. We launched in West Asia recently and by next quarter, we will enter the European market. Following this, iYogi will foray into India and some other countries in the South East Asia including Singapore, Hong Kong and other English–speaking countries in the Asia-Pacific region. In India, we are looking at large OEMs (original equipment manufacturers), smartphone manufacturers, retailers for distribution where we will attach our product for distribution at the point of sale. And also attach our service at the point of need, that is during the breakdowns.

How difficult do you think the Indian market will turn out to be?
We are looking at working for traditional Indian consumers — from Kanpur to Nagpur. So far, we have had a McDonald's kind of pricing strategy which follows the same price everywhere. India will surely have a different price. There are people who buy new technology and have very little tech support. India has a consumer base, varied by culture, language and demographics. Even within the middle class, there is the upper-middle which  comprises our target market. So, there are a lot of nuances of working in India and we are going to make sure that we succeed hands down. This is the market we want to dominate. It is our own local market.

What are the numbers like right now?
Our user base is 1.4 million. About 85 per cent of our business is direct-to-consumer acquired over the Internet. We are one of the top searched sites worldwide in tech support. We are just shy of two million unique visitors that come to our pages every month.

What kind of products does your online support cater to?
Everything. We cover from smart TVs to set-top boxes to PCs, tablets, Apple, Windows. We do Android. Also, we are consumer-centric, not product-centric. If you are our customer for a PC and later, you buy a Samsung phone, I will not tell you, "Sorry, I do not support a Samsung phone." So my job is to make sure that we are able to support all our customers — irrespective of what they are buying or using. We are present across platforms, across devices and across brands. We call ourselves freedom of choice, third party independent provider. We have plans starting from $20 and going up to $300.
Have you begun sending technicians home when online help fails?
In the US, we started home visits about a year ago. But we send only when it is required. It normally happens when I cannot get into the machine or when the consumer himself cannot get in. For instance, in a case when the machine is not booting, or the phone has completely died. Only about two per cent of the issues we face need a physical intervention. For software, we can solve 100 per cent of the problems online.

When Every second day a new product is announced, How do you stay abreast of the new technology?
That is a core capability. We have about 150 people in product management. There are another 200 in software engineering whose job is only to identify — when Microsoft Windows phone will come out, what is it going to be like? what is it going to do? Therefore, what are the user experiences which my consumer will face. What are the challenges they will face when they migrate from an Android phone to a Windows 8 phone? What are the likely issues they are going to call for? So my technician needs to be trained before the release, even before I have got my hands on the phone. That is core to what we do.


But how open are the organisations to the idea of sharing technology/ product details beforehand?
Luckily, technology is now too pervasive for anybody to be close-boxed. Twenty years ago, you had to wait for the product rollout. Today, once I know that they have ‘touch', I know what they are going to do. Once I know there is this interface on the phone, then I know which functions and features they will put into it. We understand how consumers react to technology and what technology does to them and the kind of difficulties they face. You do not necessarily have to wait for the release. We normally have a short 30-day period before the actual launch happens.

What is the biggest risk to your business?
Right now, we have the country risk (service in only a few countries). So, diversification is important. A fundamental risk would occur if we stop innovating. I have to be prepared for the next rollout of technology. We had been looking at providing Apple support for a long time but Apple made products which needed very little support—until they launched the iPad. The phones and the iPads landed in the hands of people who were not traditional Mac users. That is when the opportunity came. Today, the fastest growing business is that of Apple support. So, if somebody were to make a perfect product, we are dead. Luckily, with continuous introduction of new technology, new challenges and opportunities are likely to come up.

Cars are becoming smarter with one third of the cost attributed to electronics. Do you consider adding new offerings such as those?
We have started to move into home electronics, which is outside the purview of personal electronics. It means I can maintain or manage anything that has an IP address. Most cars, until very recently, had not built the concept of an IP address but all new vehicles have an IP address. All devices are becoming network-centric. There is an opportunity for us to either set up and install or help you use it. We are ready to sign a partnership with a home security systems seller in the US which installs cameras in your home which are connected to a DVR (digital video recorder) so that you can see every room on your smartphone. It is for the next version of baby monitoring. We signed up a deal with them for remote management, setting up and installing the DIY kit. Clearly, we will move into digital home devices. So the car will also be a part of the digital home process. Most BMW cars have 28 GB hard disk drive. Whatever music you play, you can download on to it. And it crashes too. All we have to do is to go inside, recover the system and put it back in order.

Which areas will you move into right away?
DIY home electronics have network-centric design, home servers, home heating systems. In the US, you can buy a digital home security system for $125 but installation will cost you $250. But we can help the consumer use physical installation at a fraction of the cost. We are exploring avenues by attaching ourselves to new IP-centric devices right at the time of sale. We can expand our scope to any area. We are entering into new areas like smart TV and cars. The true opportunity will come to us when your phone and personal electronics will get enmeshed into your car.

(This story was published in Businessworld Issue Dated 13-02-2012)