Rediff Logo Infotech Banner Ads Find/Feedback/Site Index
January 16, 1998


Nashsoft-Microsoft talks fall through

Email this story to a friend. It's David versus Goliath. Software giant Microsoft against a tiny start-up, the Bangalore-based anti-virus software company, Nashsoft Systems. But the result is a stalemate.

Microsoft India's insistence that Nashsoft sell the latter's anti-virus package for bundling with Windows 95 at less than a tenth of its market price has resulted in a potential deal falling through due to disagreement over prices.

The Blunting Edge
Nashsoft-MS talks fail
Hope for cellular biz
Talks were on for the last eight months between the companies to bundle Nashsoft's anti-virus package 'Nashot for Windows 95'.

The plan, according to Nashsoft, was for Microsoft to buy 20,000 copies of the package initially and up to 100,000 copies if things went well. They would then be bundled with Windows 95 and sold also in Dubai and Singapore.

While for Nashsoft the numbers were attractive and it would have been the single biggest order to date, the price Microsoft wanted it at was ridiculous to them.

"At the price Microsoft wanted, we may as well have thrown away the package. But we have worked hard at developing it,'' said Narendra Kumar, managing director, Nashsoft Systems Private Limited.

"I agree that a bundling arrangement with Microsoft will enhance Nashsoft's brand image but merely because of that we cannot agree to such a ridiculous price. But we cannot lose money because our image is being enhanced, anyway,'' he said.

Microsoft India, however, says that while talks were held no deal was struck. Said Meena Ganesh, director, application developer and Internet customer unit, Microsoft: "There were talks but it did not end in a deal being as it was not a sound business proposition.''

While Nashsoft's package is priced at Rs 3,995, a scaled-down version of it was to have been bundled along with the Windows 95 operating systems.

Nashsoft, started in 1989, is a first-generation entrepreneur's effort at making a name as a developer of anti-virus software.

Incidentally, Microsoft's new India chief, Sanjay Mirchandani, said recently in Delhi that Microsoft would support the local information technology revolution through partnerships. "We have very high expectations from the mature Indian market,'' he had said.

Kumar recalled that ironically, Microsoft Chairman Bill Gates had in a Comdex event two years ago said that the anti-virus software market is one of the biggest after the one for operating systems.

Asked what rationale Microsoft offered for the prices they offered for the package, Kumar said he had no clue. Nashsoft, he said, would have agreed to sell the copies at a price lower than the market price because of the numbers involved, but certainly not at less than a tenth of it.

Since the long-drawn talks have now fallen through, Nashsoft is preparing for the time Windows 98 will be released.

Currently, its best-selling product, though by a slight margin, is 'Nashot for Windows'.

Kumar explained Microsoft had also orally agreed to give the file format of 'Word' to Nashsoft to help the latter cure macro-viruses on non-Windows platforms.

"They agreed to give it to us eight months ago, but have made no concrete move so far and we have not received it yet,'' Kumar said.

- Compiled from the Indian media

Tell us what you think of this story