Naspers Picks Up 25 Percent Stake In Mobile Ad & Social Net Co Buzz City For $10 Million

BuzzCity, which runs a mobile advertising network and social networking site called myGamma.com has raised $10 million of growth capital from Naspers, the South African parent of MIH. BuzzCity CEO Lai Kok Fung has said on the mygamma blog, that this is for a 25 percent stake in the company. Naspers was more interested in the mobile advertising side of the business than paid services, which Buzz City launched with.

This annoucement comes a few months after exchange4media had reported that they’re in talks with an Indian entity for a strategic partnership, which Fung has denied.

Initial Investors Exit: The 3i Group, BancBoston Capital and Singapore Press Holdings Multimedia (SPHM) have exited, though SPHM will retain a small stake. What’s interesting is that BuzzCity had received $10 million in its second round of funding as well…so have these investors exited even at par? Fung has said that BuzzCity is “financially viable with earnings that adequately meet our operating expenses.”
Update: Was Naspers brought in just to give BuzzCity investors an exit?

On Buzz City India and Ibibo
India is their second largest market after Indonesia, with claims of 6,69,000 users here. On the ad network side, Buzz City claimed to have advertisers and publishers like HDFC Standard Life, Indiatimes, Tata AIG, Nazara, ICICI Bank and Kodak. The company launched their India operations in 2005, and Milind Naik and Manish Mishra represent Buzz City here.

It will be interesting to see how this plays out in India - Naspers also has a 30 percent stake in ACL Wireless which has its own mobile community - frenzo, and Ibibo also has a significant mobile community play. Everyone’s talking Mobile in India, and more and more communities and social applications are being launched here, the idea being that there are enough mobile users to go around.

So how big is the Mobile Internet base in India?

Ibibo Overhauled: Integrates Mail, Introduces Online And Mobile Games

Ibibo has an iFreshFace: the social media portal owned by MIH (Naspers) and TenCent, has undergone a complete overhaul, and now features a more integrated look. Importantly, the company has also launched their mail service, which we had taken a sneak peek at, here, while it was still being developed.

Over the past couple of years, Ibibo has, bit by bit, introduced several features - Q&A (Sawaal), Reviews (Sawaal), Photos, Blogs, Vertical search, a WAP site and Mobile features like call for free…and much more. To me, they seemed rather disparate and moving from one segment to another was a bit of a pain. All of this, and (apparently) new additions like Saral Search (segmented web search), Videos have all been integrated together.

I’ve been very critical of ibibo in the past, but I think this integration allows for easier navigation, and content and segment discovery. The only problem is that the site and the pages look so full and busy now, that it can be overwhelming to an new user; remember that ibibo had initially targeted new users with simple, minimal features. The site is also taking quite a while to load now.

On the advertising front, there are clearly defined, standardised ad spaces. Going by the content, ibibo also appears to be segmenting users according to cities - on my profile page, there were news and reviews updates related to Delhi; I wonder if localised advertising will follow. Two new promos on offer - one with Idea Cellular with the standard Web 2.0 offering as prizes - iPods. The other is the monthly iFreshFace contest, in collaboration with modelling agency Elite, and model Neha Kapur and photographer Dabboo Ratnani as judges.

Ibibo also appears to have improved their games offering, some of which - like the Instant Messenger and Mail - have probably been licensed from TenCent. They’ve now got 22 multiplayer games like Chess, Tic Tac Toe, Connect4. There’s a tie-up with Come2Play, which has also licensed their social gaming platform to Zapak. ibibo also has mobile games, but they’re charging Rs. 50 for downloads. So it appears that operator relationships for content downloads are in place (since billing will be via operator). Another addition that I’ve only just noticed - a Pro version of Sawaal (Q&A), with multiple experts on Astrology, Friendship and Health.

So with all the promos they’ve done, money they have spent, and all the features they’ve added - will they be able to take on the dominant players in the India market - Orkut, Facebook and Hi5? What do you think?

– First Look At Ibibo Mail And Messenger; Bixee - A Meta Search Brand? Bixee CrawlX
– TenCent To Invest $7.5M In MIH India Over 3 Years; Can Acquire Upto 50 Pc Stake

First Look At Ibibo Mail And Messenger; Bixee - A Meta Search Brand? Bixee CrawlX

Naspers owned MIH India (ibibo), which had recently sold stake to China’s TenCent, is preparing to launch two of TenCents products in India - Ibibo Mail and Messenger. I tried out both products today:

ibibo Messenger
Mail integration
Firstly, the messenger is open only to Ibibo users. Having a messenger will probably help ibibo increase interactivity among existing users, and the company probably hopes it will also help drive signups. Like GTalk’s integration into GMail, Ibibo Messenger is also integrated into Ibibo email(screencap).
Security & Cybercafes
What I liked most about the messenger is that, on loading, it gives the user three options for sign-in - for a Personal Computer, Cybercafe and a “message protection mode” apparently for an additional password, local to that computer. This will go down well with people who sign in from multiple machines, and use Cybercafes. However, it will be a challenge for ibibo to get the IM installed in Cybercafes, since some don’t allow users to install software. This is where a company like ideacts (which recently received funding from Sequoia Capital) might play a role for ibibo…and I’m wondering if we’ll see the Internet equivalent of TVs infamous “Carriage Fees” come into play.
Content Integration
I found this the most interesting aspect - at least three of ibibo’s products - Blogs, Sawaal (Q&A), Photos and Opinions are integrated into the messenger sidebar. Here the IM integrates with the website, and opens relevant pages for users to post content to ibibo. I’m not sure if it allows you to post via IM, though (like in case of Twitter).
A suggestion: since ibibo is a community, it would be useful to receive friends’ updates (blog posts, opinions and questions) on the IM as well.

Note: We’ve used four different skins in the images above, just to show the skins as well as features

Monetization
Like in case of MSN and Yahoo messengers a window occasionally pops up with updates from ibibo, with a couple of advertising banners (screencap)
Other Features
Users can set their status to invisible, and the messenger has a “hide” button to make it (almost) invisible. You can also choose different theme colours for the IM, and set skins as well (see some of the screencaps above).

More on ibibo Mail, Bixee & Organizational changes : (more…)

TenCent To Invest $7.5M In MIH India Over 3 Years; Can Acquire Upto 50 Pc Stake

MIH India Global Internet, the holding company for Indian Internet properties like ibibo.com, dwaar.com, onefamily.com, Newscola.com and bixee.com, and ad network AdWinks, has entered into an agreement to divest as much as 50 percent stake (less one share) to China based Tencent Holdings. Tencent, in turn, will invest at least $7.5 Million in MIH India over a period of three years, though it has the option of increasing that investment if needed. There are some conditions (of assuming certain loans) under which Tencent can increase its holding to 50 percent shareholding (minus one share).

Burn Rate: Take a look at the losses that MIH has suffered since launch:

Assuming that MIH started operations around August 2006, they’ve suffered a net loss of $18.947 Million in 23 months - an average loss of $1.114 Million (Rs. 4.76 Crores) per month. Some of that money has been spent on acquiring a 30 percent stake in ACL Wireless for $12.3 Million in July 2007, acquiring Bixee and Pixrat (for websites and a team of developers in Bangalore), developing products, allowing users to call each other for free, payouts to users as prizes, sponsoring TV shows like ibibo MTV Superstar and ibibo FTV Fashion Photographer.

Internal company transaction? This may be considered to be an internal company transaction, since the parent company of MIH India - Naspers, owns a 35.5 percent stake in TenCent. Interestingly, I’d heard murmurs of TenCent being in talks with MIH India around a year ago, but wasn’t able to verify. The deal didn’t appear to mean much then, since both are a part of Naspers portfolio.

More on valuation, Tencent’s agenda, and probable launches - (more…)