Microsoft Corp. on Wednesday agreed to provide Internet search services to Indian mobile phone users as Chief Executive Steve Ballmer met with Prime Minister Manmohan Singh to discuss the company's expansion in the country.
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Ballmer said his meetings with Singh and Communications Minister Dayanidhi Maran focused on government policies that have a bearing on the world's largest software company's interests in India and how it could participate in enhancing computer and Internet usage in India.
"We had a good chat on the need for additional innovation that will really help drive PC growth and PC penetration," he told reporters.
In October 2005, Microsoft Chairman Bill Gates said the Redmond, Wash.-based company would invest $1.7 billion over a four-year period to expand its operations in India. The company has since hired more engineers, struck new business alliances with Indian companies and increased funding for computer training programs at schools and colleges.
On Wednesday, it announced a deal to provide mobile search and other Windows Live services to customers of Hutchison Essar Ltd., one of India's leading cellular phone service providers.
The new service, expected to start in January, will be the first of its kind in India, said Asim Ghosh, managing director of Hutchison Essar, which has some 21 million subscribers across the country.
Ghosh said Internet penetration in India is low because of poor infrastructure and because many Indians can't afford to buy computers. Mobile phones are much cheaper and can prove more effective in enhancing Internet connectivity here, he said.
Moreover, India is currently adding 6 million new mobile phone subscribers every month.
"With India being the fastest-growing mobile market in the world, providing a rich set of online services for mobile subscribers is more important than ever," Ballmer said.
During his three-day Indian trip that ends Friday, Ballmer said he plans to discuss government policies, meet with business leaders in Mumbai and then travel to Microsoft's Research and Development Center in the southern Indian city of Hyderabad.
"There is a lot going on in India," he said.
Despite a low base of about 18 million computers, India's technology adoption is gaining momentum thanks to a booming software export industry and growing domestic market.
India also is a battleground for supremacy between Microsoft's proprietary Windows operating system and Linux, the rival open-source software that can be downloaded free from the Internet.
Several Indian state governments have embraced Linux, while others have accepted software donations from Microsoft.
Ballmer's talks with Indian leaders Wednesday also touched on steps taken by Microsoft to make Windows available in more Indian languages.
Localizing Windows has been a key component of Microsoft's strategy to stay ahead of its competition in India, where only a small fraction of its 1.06 billion people speak English.
Ballmer said the company plans to bring Windows Vista — the first update of its operating system since 2001 — and Office 2007 to India soon, but he declined to give a firm date for the launch.