Sun invests in India as business there booms

Sun Microsystems Inc. is to make large investments in India as business for the company grows quickly in the country, according to the head of its Indian operation.

Sun’s revenue in India grew 28 percent during its fiscal year to June, with services revenue growing by 70 percent and server shipments up by 70 percent on a unit basis, Bhaskar Pramanik, managing director of Sun Microsystems India, told reporters Tuesday in Bangalore.

The revenue growth in India outstripped growth in China during the period, Pramanik added.

Sun, which does not disclose revenues by country, added 164 new customers during the year in India. It has a dominant share of the telecom and software outsourcing industries, and the banking, financial services and insurance segments of the Indian IT market, Pramanik said.

Worldwide, Sun’s results have been less impressive as it battled competition from server rivals IBM Corp. and Hewlett-Packard Co. It recorded revenue of US$11.1 billion for its 2005 fiscal year, down 1 percent from a year earlier. It reported a net loss for the year of $11 million, an improvement over last year’s $388 million net loss.

Two of five wins in the Asia Pacific region for the company’s new managed services offering have come from India, a Sun spokesman said Wednesday. These are Punjab National Bank in Delhi and telecommunications services provider Reliance Infocomm Ltd in Mumbai.

Sun, in Santa Clara, California, has identified India as one of four countries for “major investments” in its global “mission charter” for the financial year ending June 2006, Pramanik said.

A large part of the India investment — the size of which was not disclosed — will be in Bangalore, both for sales and marketing and to improve the company’s services and engineering capabilities, he said.

The other three investments are planned for Beijing, Prague, and St. Petersburg in Russia, Pramanik said.

Sun has invested $150 million in India since 1998. It employs 1,200 staff in the country, 1,000 of which work at its engineering center. Sun offers systems running Linux as well as its Solaris operating system, but customers in India are not yet comfortable using Linux for mission critical applications, according to Pramanik.

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