The IT industry has so far witnessed three major changes. Each changeover has been marked by emergence of technologies that have dramatically increased the number of IT users and applications, riding a new wave of growth. No doubt, elements of the previous period remained, but new technology was the driving force in the growth of the industry.   

The first period ushered in computer technology with the coming of the mainframes. But usage was limited. Mini computers led the IT growth in the second phase and helped automate several business processes. And, the third phase which began some 20 year ago, belonged to the PCs and client/server technology.   

The fourth period, which is in its early stages, is the Internet era or the wired market era. The wide and instantaneous reach of Internet, displays its potential to fuel another `order-of-magnitude growth' in the IT industry.   

In 1996, about US $ 19 billion was spent on Internet/Internet-related products, which represented 26% of the incremental growth in the IT industry. Internet is gradually replacing PCs as the driving force in the growth of the industry. IT industry revenues could jump from the present less than 2% of global production to 3-3.5% in the next 10 years.   

What constitues the Internet?   

Internet can be said to be a very large network of computers or a network of networks in which one computer can communicate with another, in a seamless fashion. Internet integrates several networks to form a large world wide network. The term internet also encompasses resources that can be reached from these networks. The terms Internet and world wide web (WWW) which run on the Internet are many a time used inter-changeably.   

The TCPL/IP (Transfer Control Protocol/Interent Protocol is the standard for Internet networking. But, all networks are not based on the TCPL/IP protocols.   

The Internet is neither owned nor governed by any single authority. Voluntary associations like the Internet Society (IS) and Internet Engineering Task Force (IETF) an association of users, together decide standards for Internet use and asigning addresses. Each net work funds its own infrastructure and collects fees from users by way of connection charges.   

Size and growth of the Internet   

The Internet is made up of thousands of smaller regional networks scattered across the globe. About 20 million users connect online on any given day. The total number of Internet users world wide is estimated to be round 100 million of which about 55-60 million are in US alone. The Internet population is growing at a rapid pace adding close to 10% in its numbers every month.   

Internet users are both business people as well as consumers. The business market is dominated by access to information services while the consumer market is dominated by access to entertainment/information services.   

Internet's Salient features   

Internet users are predominantly the educated young urbanites in the higher income bracket.   

Internet penetration varies widely. US has the highest penetration rates and has a 1-2 year lead over other countries.   

Internet also puts business on the same footing regardless of size and/or financial muscle. This is one of the key advantages of the Internet.   

Internet makes it possible for companies to enteract with any other business/service providers/customers present anywhere in the world.   

Internet access costs a fraction of the cost associated with alternative networking and communication technologies or other physical forms of delivery.   

All industries (except the traditional intermediaries) stand to benefit from the Internet. The direct beneficiaries included suppliers of Internet and related hardware, software and Internet-related services.   

Internet is mostly software driven. Growth in Internet is therefore bound to benefit the software providers.   

Information available on the net is vast and it is increasing rapidly. This makes it essential for the users to have aggregation services.   


The current Internet population of about 100 million users world-wide is expected to increase to about 350 million by the year 2003.   

Internet in India   

According to Nasscom, the current estimated subscribers are about 0.25 million (2.5 lakhs), which is expected to reach 1.5 million (15 lakhs).   

Commercial transactions on the net were estimated at Rs. 120 million in FY' 99. This is expected to cross Rs. 300 million by 2000.   

The current user base of about 0.15 million is expected to grow strongly to about 0.5 million by 2000 AD.   

Despite the tremendous popularity, Internet has not been able to expand to its full potential in India. One of the key deterrents has been the price of VSNL service.   

Policy framework   

In October, 1997, the government framed the Internet Licensing Policy permitting entry of private ISPs. It is however yet to stabilise and emerge from controversies.   

Now Internet 2   

The next generation of the internet-Internet 2 was to be given final shape at technology summit to be held in Pittsburgh in June 1999. Internet 2 aims at developing a new family of advanced applications and technologies to meet emerging academic requirements in research, teaching and learning. The project will create a leading edge network capability, enabling a new generation of applications, and work with industry and international partners to transfer new technologies into the global internet.   

The workshop, jointly organised by NLANR Engineering Services and Internet 2, will build up from where the previous technology meets left off and cover critical topics like network tools, security and gigapops. Importantly, issues related with campus networks and performance various networks and systems will come up for discussion.   

Internet 2 is a collaborative project of over 150 US research universities working in association with top industry leaders and US Federal government agencies.   

I.T. firms target India for e-commerce   

India by all indications is set to emerge as the next stop after the US and Europe for global software vendors vying for a share of the electronic commerce (e-commerce) business worldwide, which is expected to grow into a trillion dollar industry by the end of the century.   

IGNOU to make inroad into Infotech education   

The Indira Gandhi National Open University is tying up with Microsoft Corporation for a major foray into information technology education and infotech courseware exports. On the offer will be several specialised IT courses and Microsoft authorised training centres across the country.   

The University is mulling over the idea of floating a separate body for the IT education venture which will also take up consultancy work with the industry.   

A team of senior faculty members is likely to visit several top universities around the world, such as Stanford, Carneige Mellon and British Columbia, to work out a working relationship.   

Talks are also going on with Microsoft and other similar bodies for conducting programmes.   

Punjab Plans IT park at Mohali   

The Punjab government through its Electronics Corporation in Collaboration with a private partner, is in the process of setting up a software technology park (SOFTOP) at Mohali. It will comprise a dedicated satellite earthstation for international connectivity and, will provide physical infrastructure for setting up the industry's operations.   

The park complex would cover an area of about 4 lakh sq. feet to house software export units. An electronic hardware manufacturing complex, with a total covered area of about 2 lakh sq. feet, will house electronics and hardware manufacturing units.   

An institute of Information Technology is also planned to provide training in computer software and expert consultancy to the software industry and create a research facility in the field of hi-tech system software.   

An area of 15-20 acres has been reserved for allotment to global industries for allotment to global industries for setting up manufacturing and R&D units in electronic and I.T.   

UP govt. approves new I.T. policy   

The Uttar Pradesh government on April 21 approved a new Information Technology policy waiving sales tax on software industries for the first 12 years and decided to develop "smart cities" where all government work will be done through computers.   

The government would also provide "incentives" to private companies willing to invest in setting up computer industries in the state.   

For transmitting communication signals, the government also plans to establish earth stations at Noida, Dehradun, Allahabad, Varanasi and Lucknow.   

Maharashtra chalks out plan to lead I.T.   

The Maharashtra government has decided to adopt a three pronged strategy for projecting the state as the "leader" in the information technology (I.T.) industry. For this the government plans to concentrate on aggressive marketing at the national and international levels, prepare a comprehensive website on I.T. and also release an I.T. directory according to Shri Prakash Jawadekar, Chairman state Task force on I.T.   

The government will lay emphasis on the implementation of the I.T. policy with special focus on "empowerment through connectivity". It plans to computerise government departments and encourage private sector investment in this sector.   

MP announces I.T. policy   

Madhya Pradesh Chief Minister Shri Digvijay Singh on May 5 unveiled his model of I.T. policy for the state and signed as many as six MOUs with companies like NIIT, Tata, IBM, Oracle India Software and C-DAC for boosting I.T. proliferation in the state. NIIT would assist the MP government in developing a citizen-IT interface, which is a key cornerstone of the state's I.T. policy.   

The thrust of the MP model of I.T. would be on electronic governance and strengthening the decentralisation of decision making. MP government did not propose and direct investment but wished the private sector to come and invest in setting up IT infrastructure based on excellent telecommunications facilities along with a 10,000 km optic fibre backbone it offered. A target of attracting investment to the tune of Rs. 4,500 crore has been set by the state. It also aims to achieve a share of 10 percent of the national IT output by year 2008. This would provide employment opportunities to about 10 lakh persons.   

MP has formed a registered society called Madhya Pradesh Agency for Promotion of IT (MAP IT) headed by the Chief Minister which will act as a nodal point for all IT development work in the state. Shri Singh also inaugurated a website where concerned citizens can directly send in their queries or complaints to him through a bulletin board service which is also being set up.   

IIS Infotech initiates new software deployment method  

Delhi based JIS Infotech launched on May 10, 1999 its training, accreditation and consultancy services in association with the National Association of Software and Services Companies (NASSCOM) to upgrade the competitiveness of Indian Software industry. US is a member of Dynamic Systems Development Method (DSDM) consortium. DSDM is a vendor-independent framework of controls for the development of business-centric I.T. systems to function under tight time schedules.   

Software exports from TN grow at 200 p.c.   

Software exports from Tamil Nadu grew a little over 200 per cent for year ending 1998-99 to Rs. 1,246.14 crore, compared to the previous year's performance of around Rs. 400 crore. They are expected to grow by another 100 p.c. this year to touch Rs. 2,500 crore, according to Software Technology Parks of India an autonomous society under the department of electronics.   

Software, electronics exports grow 43%   

Computer Software services and electronics exports have registered an increase of Rs. 5335 crore from Rs. 12,440 crore in 1997-98 to Rs. 17,775 crore in 1998-99 a growth of 43%. The growth is 29 per cent in dollar terms.   

Exports of computer software services alone have registered a growth of 84 percent (66 per cent in dollar terms).   

The growth is attributed to some major policy decisions on issues relating to reduction of international telecom and leased line tariffs ADR/GDR linked Stock Option Scheme and recognition of video software exports.   

Export revenues also increased on account of Y2K opportunity and widening of software base in India.   


The Council of State Industrial Development and Investment Corporation of India (COSIDICI) is going to launch its own website on the internet which, among other things, will provide hyper-links to other member corporations which have their own independent websites. The Small Industrial Development Bank of India (SIDBI) Lucknow, has assured assistance to COSIDICI in launching the website.