Rajan Anandan, who recently took over as managing director and vice president for sales and operations at Google India, has inherited one of the few profitable Internet operations in the country — in the 15-month period ending March 31, 2010, the company had a profit after tax of US$22 million on revenues of US$175 million, according to Medianama, a website focused on telecom and digital media in India.Dataquest puts the site’s 2009-10 revenues at US$37 million. (Google India, which, as a private company does not have to reveal financial numbers, would not confirm these figures.)
But profits are not the primary focus for Anandan at the moment. Large parts of India are virgin territory for the Internet. According to the International Telecommunication Union, there were 81 million Internet users in India in 2010, a penetration of just 6.9%. Google has to be an evangelist, a developer and, finally, a profitable business, Anandan told India Knowledge at Wharton.
An edited version of the transcript appears below.
India Knowledge at Wharton: Google dominates headlines in spaces such as email, videos and maps, and has also been successful with its mobile products. But it has struggled to create a social networking site with staying power. The company recently launched its latest effort social networking effort, Google+. What is different this time?
Rajan Anandan: We have been successful with social media. In fact, Orkut to date has around eight million active users. However, technology is all about innovation and hence we’ve launched Google+.
Our social strategy is to make the web social. The web should in fact be your social destination. The Google+ project is our attempt to make online sharing even better. We aren’t trying to replace what’s currently available. We just want to introduce a new way to connect online with the people that matter to you. Google+ aims to make sharing on the web more like sharing in the real world. You share different things with different people. Google+ gives people more choice when it comes to how they share and connect online.
India Knowledge at Wharton: Every Indian Internet user knows Google. But very few people know what Google is doing in India. Could you briefly describe your operations, your headcount and how you plan to scale them up?
Anandan: Google today has four centers in India — Bangalore, Hyderabad, Delhi and Mumbai. Bangalore was one of Google’s first R&D centers outside of the U.S. and was set up with a charter to innovate, implement, and launch new Google technologies and products. Google Hyderabad, the second of Google’s offices in India, is home to engineering, online sales and operations, information systems, human resources and other support functions. The Google Delhi and Mumbai offices focus on supporting Indian advertisers through the Google AdWords program and developing local business opportunities by providing locally-relevant products and services.
India forms a key part of Google’s strategy of operating as a globally-integrated company and is one of the few places in the world where all of Google’s global functions are represented. We currently have a headcount of 2,000 employees in the country. While we do not give forward-looking projections, I would like to say that we have very ambitious growth plans and will be expanding our operations in the country.
India Knowledge at Wharton: What do you see as Google’s mission in India?
Anandan: India is uniquely important for Google and there are multiple reasons for that. India is seeing the fastest growth in Internet adoption across the globe. With 100 million users in India, the Internet is definitely going mainstream here. Our mission is to bring the enormous potential that the Internet offers.
We are investing in India because we believe that we can add real value here by helping users to access information and by enabling companies to reach their target audience more effectively….
By 2015, we believe that there will be three billion people using the Internet, up from the present two billion. Companies like Google fundamentally transform lives by bringing the power of the Internet to users. In addition to being the world’s largest search platform, we are also the largest email platform and YouTube [which is owned by Google] is the largest video platform. [Google] Maps is among the largest geo-platforms. The mobile opportunity in India is really big with more than 500 million mobile users….
From an advertising standpoint, we have seen double digit growth and we continue to see high traction in the market for all offerings. In a nutshell, India is a high growth and high potential market for Google. We are committed to grow the market by offering more locally-relevant services to further drive the adoption of Internet in the country.
India Knowledge at Wharton: Your development centers at Bangalore and Hyderabad are working on cloud computing applications. What is your perception of cloud computing?
Anandan: We believe that the cloud is changing the way people communicate and collaborate worldwide. In India, despite connectivity challenges, we are seeing increasing interest and momentum for our cloud offering. The computing world everywhere has evolved from [saying,] “The cloud is the future” to “The cloud is the present.”
We are seeing strong interest for our products and services in India and can say with confidence that cloud computing will be highly disruptive in this market. Looking forward, our strategy is focused on a number of areas: first, bringing more businesses to the cloud; second, growing the market with our partners; third, hiring across functions, and fourth, making Indian sites the centers of excellence for enterprise engineering globally.
Businesses of all sizes benefit from cloud computing. In India, big organizations like Indiainfoline and Sterlite Technologies are on Google Apps. But the interest from the small and medium business sector has been phenomenal. Among our users are Saurashtra Cements, Flipkart, Team Computers, India Pistons, Orient Tiles, Cosmo Films and Haier Mobile.
India Knowledge at Wharton: There has been some talk about Google setting up a US$1billion data center in India. Has there been any progress on that front?
Anandan: We do not speculate on rumors. Google has never said that we will set up a data center in India. We serve countries as needed. Google has data centers in multiple locations in order to allow businesses to optimize their computing power and performance, as well as protect against loss of user data in the event of power outages.
India Knowledge at Wharton: Google has been often been recognized as a good place to work, but the company has recently faced complaints from employees about comparatively low pay and the cutting of some benefits. How has the company responded to this?
Anandan: Globally, in every market, Google has been nominated as the best employer. In India, too, we have been voted as the best employer in the country for the second time in a row in a survey conducted by The Economic Times and the Great Place to Work Institute. I believe we are the only company to have done so. This award is based on employee votes, so it says a lot for us. At Google we hire the best, empower them at incredible levels and keep them motivated…
India Knowledge at Wharton: The Internet has innovation cycles that tend to be shorter than that of other industries. How does Google keep itself fresh?
Anandan: The Internet … has very rapid cycles of innovation. One has to constantly seed and drive this business. Android has crossed 50% market share in the smartphone category…. In video, YouTube is the largest video network by far in the world. We will continue to seed innovation.
India Knowledge at Wharton: What is Google’s take on providing privacy for its users?
Anandan: At Google we take privacy very seriously. In fact, I would say that we are obsessed with it. Among all companies in the world, we do more for privacy-related issues. For most of our products, the user is in control. We don’t control the flow of information; the user does. We have even introduced the Google Dashboard, a service that provides an online summary of a user’s Google files — Gmail, Google Docs, Picasa photos and so on — by collecting pre-existing privacy controls in one place. Dashboard users can review and delete recent Google searches, see recently opened and shared documents and survey their interactions with other Google-powered sites such as YouTube.
India Knowledge at Wharton: How do you see tomorrow’s Google?
Anandan: The company is all about innovation, so tomorrow’s Google will offer more products, innovation and value. We will offer more magic.