Indian retailers shy away from IT

Although the US$8 billion Indian retail sector is growing fast, the IT usage is yet to match pace with it, reports CXOtoday.com.

Ganesan Sekar, senior VP of Satyam, said: "Only a handful of organised tier one retailers are investing in technology to capitalise on the retail boom in India." Moreover, as labour is cheap, even the use of technology in the Indian retail market is limited to areas such as in-store, merchandising, financial and accounting.

However, Sekar admits that several retailers, both in the organised and unorganised sectors, have started discussions with IT vendors to augment their business potential, with the help of technology. Commenting on the IT requirements of the Indian retail market, Sekar said: "At the moment, there is a need for operational solutions, such as point of sale, merchandise management system, and merchandise planning to run the business."

While Joyo and Dangdang control roughly one third of the market, no other firm has more than a 4% share in business-to-consumer (B2C) online sales, reports iTNews.com.au.

US-based consumer products retailer Newegg has an estimated two million registered users in China, or about 3% of the country's total. Giant online retailer Amazon first invested in Joyo in 2004, at which time it was generally consider China's leading B2C provider.

However, although Dangdang appears to have grown faster since then, both firms are losing money, according to analysts. Amazon founder Jeff Bezos announced on a visit to China earlier in June that his firm would increase its stake to take control of Joyo, and was changing the company's name to Joyo/Amazon.

eWeek.com reports electronic payment vendor CyberSource is buying fellow e-payment player Authorize.Net for $565 million in cash and stock, the companies announced. Steve Rowen, a research analyst at Retail System Research, said the merger of these two players is not in itself surprising, but the size of the deal reveals a lot about retail interests.

"CyberSource acquiring Authorize.Net is a highly logical move. Is it an industry-changing deal? Not at all," Rowen said, but added that a deeper look at the metrics behind data theft suggests other significance to this $565 million deal.

"To a data criminal, a personal account number has a street value of $3. By way of comparison, the full track data from a credit card swipe at a card-present merchant yields anywhere from $35 to $50. As a result, e-commerce retailers are not as attractive to thieves as those who operate physical stores," Rowen said.