The entire idea seems built on a flimsy ground as the company is building its e-commerce models on a proprietary wide area network (WAN) rather than on internet. With more than 160 internet service providers (ISPs) already registered (whose reach is far more), S Kumar.Com's idea may not find many buyers. Nevertheless, ISPs suffer from handicaps like the low PC penetration and the lack of telecommunication infrastructure.

S Kumars.com will have a network of proprietary e-commerce kiosks through out the entire country. Customers can walk into kiosks and order goods to be sent to a friend living in another city. Or they can use these kiosks to enroll in distance education programmers. Customers canalso place classified ads through these kiosks.

The kiosks will be linked through a very small aperture terminals (V-Sats). Although V-Sat is a more expensive than cable at the initial investment stage, the operating costs are lower in the case of former. These V-Sat-linked kiosks will serve as points of sale for buying goods and services on line, distance learning programmers and classified information. The company hopes to earn substantially through these three revenue streams.

However, the company itself is not investing anything in e-commerce network project. The network project, which is estimated to cost over Rs 1,000 crore, will be built by its distributors and franchisees. To be a franchise of the company, one has to have a approximately 5 sq mts of area and an investment of around Rs 2 lakh. The company plans to rope in 50,000 franchises from over 1000 cities in the first phase. The second phase will target smaller towns and the third phase, rural India. With the Internet based e-commerceexpected to take some more time to penetrate to smaller towns and rural India, where the telephone infrastructure is not strong enough to support Internet venture, the company may be able to just pull off what seems like an impossible task. The company is expected to grow at a very fast pace in the next couple of years.

--Sunita Nagpal