Excellant and timely information!! Think of the fact that the banks are ready to offer lower interest for conusmer goods and higher interest for dire necessity!! Is it because of the risk factor?

Several enterprising people have set up guest houses on similar lines for corporate executives.In Bangalore a business man was reported to have taken more than a hundred residential houses on lease for this purpose. It works out cheaper than good hotels and perhaps maybe more comfortable with a home like atmosphere.

Tata's innovative strategy is great for India and many will try to imitate the business model. Yes! The same strategy should be applied to computing industry. For example in softwares the user pays a heavy price for a product like an operating system program. The cost also covers past research and future research spending and much of it goes into useless cosmetic changes & additions, rebranding and packaging.

Many software makers have started to offer different versions like standard and premium editions but not the popular softwares for os, graphics & office suites which is in high demand. I think they are making a big mistake and soon may lose out their position in the market if their competitors adopt the strategy like the Tatas have done now.

It is a good start, but I think the benchmark should be Thailand. Where even in Bangkok, you can get decent rooms for half of that. Then you see in the surge in tourist numbers.

As for the computing question, I guess ISPs can offer PC systems on subscription basis. The more software you want, the higher the monthly fee.

Funny you mention that. Read yesterday on the Internation Herald Tribune of a similar attempt- in Europe, though, which is a total different ballgame. Indeed, the concept and value proposition are quite different but as Euro strengthens it necessitates some kind of radical solution of this sort. The question regarding similar implication on software and hardware is food for thought.

Can EasyHotel succeed with rooms at £5 a night?
Shelley Emling IHT Saturday, July 3, 2004
The Greek entrepreneur Stelios Haji-Ioannou is raising his bet on travel with EasyHotel, as new chain of no-frills hotels where rooms will cost as little as £5.
Haji-Ioannou - whose private empire, EasyGroup,owns 41 percent of the EasyJet airline as well as businesses including EasyCar, EasyInternetcafe and EasyCinema - believes in the low-cost business model.
He has often pointed out that travelers can fly around Europe for less than £100, or $182, but can barely buy a night and a half in even the cheapest London hotel for the same price.
But critics wonder whether the no-frills model that has worked so well for airlines can be expanded to other businesses. John Williamson, a director of the brand consultancy Wolff Olins, said that in general the value of the "Easy" brand seemed to have diminished over the past year.
"There's no question that the company, along with Ryanair, rewrote the business model for air travel and created a new kind of brand," he said. "But in the end EasyGroup doesn't seem to have the ability to take their brand and use it elsewhere."
One example is EasyCinema, an EasyGroup business, which has run into roadblocks as it has tried to get first-run movies from big distributors.
In May 2003, EasyGroup leased a multiplex theater in Milton Keynes, north of London, and began showing mostly second-run and foreign language films for 50 pence a ticket.
In the past week, it has landed its first two blockbusters - "Shrek 2" and "Spider-Man 2" - which are opening this month at EasyCinema, on the same days as their national releases. Ticket prices have had to be increased - to £4.50 each.
With EasyHotel, how willing travelers will be to trade space for the price is anyone's guess. Room sizes will start at 8 square meters, or 90 square feet, and there will be no TV or phone. If you want your bed made, you will have to make it yourself.
"Spending two hours on a plane is different from seven nights in a hotel," said Williamson, the brand consultant. "I'm not sure travelers will go for this."
Though prices will start at £5, James Rothnie, a spokesman for EasyHotel, said that the average cost of a room would be about £30 - the level at which Haji-Ioannou has said the hotel will break even.

the very fact that this news item has evoked good response, by way of comments, speaks itself of the necessity and the possible success of this venture.

this is super cool..my feedback was not accurate towards each question (I was checking how close it would get), and it got quite close. I thought paper cup - the answer was a straw.

Very Impressive.