BANGALORE: The changing profile of the Indian PC market will see Intel, the world’s largest chip manufacturer, increasingly focusing on the tier 3 and 4 towns as part of its future growth plans.

The Indian PC market which was largely dominated by 5-6 cities around seven years back is now spread across 300 cities with strong demand outside of the metros. Intel India director -- sales (South Asia) Ravichandran R, said tier 3 and 4 towns will becomes its future growth areas. In fact, these locations are recording higher growth than the metros though on a smaller base.

According to IDC, the installed PC base in the country recorded a CAGR of 32.3 per cent to grow from 9.5 million in 2003 to cross 22 million in 2006, thereby more than doubling in a three-year time frame. This constitutes one PC for every 50 Indians.

Ravichandran said it is increasingly looking at the penetrating into this market largely through its partner network as this space is very large and fragmented. The major buying segments in the tier 3 and 4 towns will be the SMBs and retail. It is estimated that 65 per cent of the PC sales in the country come from these segments.

The Intel official said the challenge for them would be to get their share of the consumer’s purse, which would otherwise normally go into purchase other electronic items like a TV.

Intel is already looking at increasing the PC penetration through twin strategy of increasing broadband internet connectivity and educating the masses on the benefits of technology. It is already participating in projects at places like Pune and Uttarakhand to provide wireless internet connectivity through the technologies of WiMax and WiFi.

This push into the tier 3 & 4 towns is also being fuelled by the Intel’s World Ahead programme which will provide the content, access and education about PCs. It has already committed an investment of $1 billion for the developing countries for this programme.

Ravichandran said the large volume of growth is still coming in from the top metros and this will be increasingly driven by the large retail formats.