Zenith Computers poised to grow the gaming way!

Inspired by the findings of a survey? Well almost! After having secured the titles of the country's second largest PC vendor (IDC report, 1999) and the single largest brand in the home PC market (IMRB report, 1998), Zenith Computers Limited wants more. In a strategic move revolving around the objective of outdoing multinationals and grabbing a significant portion of the high-end market, the company has launched India's first ready to use gaming PC, Zenith Xtreme, in collaboration with Singapore's Creative Technology Ltd., a leading provider of personal digital entertainment solutions.

Zenith's decision to come out with the product was largely based on findings of an IDC-India survey carried out in September 2000. According to the survey, among the primary reasons people bought PCs for home were "the need to enhance computer skills of self and family members", "children's education application", and "playing games".

Using technologies offered by Creative, Zenith Xtreme is set to offer total end-to-end PC gaming and entertainment experience and is packed with features like the latest 3D graphics engine, multi-channel 3D audio engine and 3D surround-sound home theatre speaker systems. Other features include Creative 'sound-blaster-live' sound card, Creative PC-DVD 12X, Creative Cambridge sound works, four point surround FPS 1000 speakers and Creative video blaster web cam go plus, which works as a desktop PC camera as well as a portable digital camera. Xtreme is being powered with Intel Pentium III processor of speed 800 MHz and onwards. The machine is being offered in two variants, Xtreme Standard (price Rs 75,000) and Xtreme Premium (price Rs 115,000).

Speaking to domain-B, Raj Saraf, chairman and managing director of the company, claimed that this kind of PC does not exist anywhere in the world — not even with Compaq and IBM. He further stated that even though it is the highest priced PC in India, if the same configuration were to be offered by any multinational company, it would cost much more than the Zenith pricing.

Adding to what the chairman had stated, Shrikant Joshi, senior vice president product and technology division of the company added, "The machine symbolizes the ultimate spirit of the internet age."

Mr Joshi denied that the decision to make the machine was influenced entirely by the outcome of the IDC survey, but admitted that it did help in crystallizing the decision. According to him, Zenith had been planning such a product much ahead of the survey. He said that all along Zenith had been operating in the lower end of the market and now the company wanted to move up the value chain. Moreover, he added, the MNCs had been coming into the market in a big way and the company wanted to come out with something that the MNCs would not be able to replicate easily.

Xtreme is likely to do wonders to the financials of Zenith Computers. To a question on the likely volumes of sales, Mr Joshi told domain-B, that the company expected to sell about 300 machines in the next two to three months, thus giving it a top line addition of over Rs 30 crore. This could well mean higher profits for Zenith. At the expected margin of around 10 per cent, this could add a cool Rs 3 crore to the bottom line of the company.

What next?
With the onslaught of pay channels due to come soon, Zenith is likely to tap the set-top boxes market in the future. Speaking to domain-B, Mr Joshi said, "Though it is difficult to quantify the market size exactly, one would think that each of the 50 million homes, which have a colour television, will ultimately require a set-top box." Assuming that a set-top box is sold for Rs 5,000 each, the total market size amounts to Rs 25,000 crore, huge by any standards.

In the meantime, the management has decided to defer the ADR issue of group company, Zenith Infotech Ltd, on account of the poor market conditions prevailing right now. The issue is likely to be floated sometime around June next year.