Opening Up The API – Why, and Which verticals are going to follow iShare?
Our platform is such that almost every 10 days to two weeks, you’re going to see new verticals open. iShare was the challenging one, so we did that first. You’ll find that in Q&A, in news, in Mail, once the new mail platform is introduced. Within three and three and a half months, our entire 12-12.5 million users will be accessible to application developers, initially through the Facebook Markup Language, and OpenSocial as well.
Making yourself a programmable platform is an irreversible direction in which portals have to go. The reason for that is very long term, indeed. The number of application developers in the world is estimated at a billion developers worldwide. It will be absolutely foolish to try and match their talent with in-house development. This (companies opening up the API) is as significant as when the first Microsoft Office products came out. An investment in this has been made over the past two years – the cost of doing this – 80 percent is manpower. The cost is in attracting the right talent, it’s not counted in the millions of dollars but the energy invested. I expect that the future exponential growth for us will happen on the back of applications that get added to our platform.
On The Advertising Scenario
April-June has historically been a slow start, but much less of a hit this year. The upcoming quarters may have some challenges associated with that. The consumer finance sector accounts for a lions share of advertising – the credit card and home loan companies. Interest rates have gone up, and banks are tightening credit. That’s a challenge for many of these companies. The second category is the jobs category. 40-50 percent of their revenue comes from IT recruitment, which isn’t as hot anymore. The third is travel sector, and right now there’s a standoff between them and low cost airlines who will not pay commissions from October. I think these problems will get resolved by the Oct-Dec quarter.
More on the Advertising scenario and competition –
What is interesting is that consumer product companies are seeming to have been excited by the Internet at long last. We are getting a number of inquiries from mainstream ad agencies and their interactive subsidiaries – The classical advertiser is coming online. My expectation is that CPM advertising will increase faster than the performance based advertising – because the performance advertising is matrimonial, Travel etc bought clicks at competitive prices. It’s all for the good.
You must remember that we are at a certain stage of growth, where the number of online users online is becoming comparable to the offline media. For example – our finance channel gets nearly 2 million unique users a month – far higher than any financial newspapers, and many times the order of the financial magazines. We can now compete in the 97 percent part of the market. Obviously this is not going to happen overnight – a lot of concept selling will be required. At last Indian market size is shaping up, and becoming comparable to print.
We really have only two competitors left in India – Yahoo and Google. So we have to match them in some of the core businesses that they are in. That is really the challenge.
Are Media Companies like NDTV and Network18 competition, leveraging offline properties online?
It’s not worked anywhere in the world – it’s not happened for ABC, NBC and others. The user base online is completely different. NDTV is a great news provider, but going by any measure, they’re a fraction – around 10 percent of what we are. Web18s MoneyControl has a unique user base less than our finance channel MoneyWiz (2 Million). Our total unique users in India are 9.5 million, and worldwide there are around 12 million.