Is Videocon Looking To Acquire Loss Making IPTV And VoIP Co IOL Netcom?

Someone told me a couple of weeks ago that Videocon is looking to launch DTH services. In that context, this story, about Videocons plans to acquire IOL Netcom doesn’t come as a surprise: ET reports that two Videocon affiliated companies - Shree Dhoot Trading & Agencies Ltd (SDTAL), an investment company of the Dhoot family that owns Videocon, and Videocon Realty & Infrastructure Ltd (VRIL) have picked up 11.72 percent and 1.97 percent percent equity in IOL Netcom.

Looking at IOLs earnings report annexures, it appears that this is up from SDTALs 6.51 percent stake, and VRILs 1.83 percent stake at the end of Q1-09. IOL Netcom President Siddharth Srivastava has denied that there has been any takeover proposal from Videocon.

IOL Netcom offers content on MTNLs IPTV, and this would fit in with Videocons telecom, DTH and IPTV plans. Here’s a list of their channels. Do note that the company also entered the Voice Over Internet Protocol business (for MTNL) by merging with Exatt Technologies (an allocation of 25 lakh shares, PDF). Exatt was an ISP operating in 10 circles, in collaboration with local cable operators. IOL also tied up to bring GyPSii, a geo-location social networking platform for mobile, web and importantly - set top boxes. The tie-up was via IOLs subsidiary Broadway (site under construction since Feb). GyPSii is a map service and a friend finder.

For the quarter ending June 30th 2008, IOL Netcom reported a net loss of Rs. 9.68 lakhs crores, with revenues of Rs. 3.04 lakhs crores. For the last fiscal, the company had reported a loss of Rs. 21.46 crores, with revenues of Rs. 24.25 crores. Important to note that they paid Rs. 10.08 crores in the year for “Purchase of traded goods”…is that payout for content acquisition?

Note that the Times of India Group (BCCL) also owns a 1.83 percent stake in IOL Netcom, as well as a stake in Videocon, both via the private treaty investment route.

Download: Q1-09 Financials, Annexure

Q1-09 Call: HT Media - Rs. 100 Crores Internet Biz In 1.5 Years; Matrimonial Portal In Q3, Real Estate In Q1 2010

Internet
HT Media expects their Internet business to be around Rs. 100 crores in terms of revenues in around a year and a half. The company has invested around Rs. 20 crores in the Internet business so far, of a total planned investment of Rs. 150 crores over the next 3 years.

At the same time, note that key portals hindustantimes.com and livemint.com are a part of HT Media - and not a part of the Internet subsidiary FireFly E-Ventures. Hindustantimes.com got around 10.5 million pageviews during the quarter, with revenues of around Rs. 70 lakh per month - “fairly small” according to the company.

FireFly E-Ventures is expected to launch their real estate and matrimonial portals are expected to be launched around Q4 of this year - Matrimonial will be by around Q4 of this year (Jan-March 2009), and real estate by Q1 of next fiscal year (April-June). In this context, it is also important to note that Real Estate advertisers account for 12-13 percent of HT Media’s revenues - 12 percent last fiscal, and 13 percent in Q1.

Some stats on Shine - I’m not sure if the HT Media management quite understands that metrics for a job portal are different from those for a news site like HT.com, but anyway - Shine receives 14 million pageviews per month, and this number is growing at 15 percent month-on-month. The portal gets 3 million unique users per month, and has a total registered user base of 7.3 lakh

Private Treaties
Accounted for a fairly small part of the total advertising revenue this quarter - around Rs. 6 crores. In all, deals have been struck for around Rs. 70 crores, spread over 3-5 years. What’s more, HT Media did not disclosure of names treaties investments, since these are covered by non-disclosure agreements. If you know of any Internet companies that have signed up with them, do let us know.

Related: HT Media Reports Profit Of Rs. 37.72 Crores; Shine Adds 6758 Registered Users/Day

HT Media Reports Profit Of Rs. 37.72 Crores; Shine Adds 6758 Registered Users/Day

HT Media has reported a profit of Rs. 37.72 crores for the first quarter of FY09, up from Rs. 34.16 crores for the same quarter in FY08; revenues were up 17 percent Year on Year at Rs. 332.89 crores, and advertising revenues were up 19 percent. EBITDA was up 13 percent to Rs. 74.5 crores from Rs. 66 crores for Q1-08.

HT Media’s job portal Shine.com appears to have overwhelmed them - despite all the advertising spends, the number of registered users has gone up to 2.3 lakhs 7.4 lakh. They had claimed 1.25 lakhs at the end of last quarter, and that’s an addition of around 1153 6758 registered users per day during the quarter. Frankly, given all the advertising spends across Web, Print, TV and Radio - Shine’s performance has would have been lacklustre, if not disastrous at just 2.3 Lakh, but it’s 7.4 lakh in all. Update: during the earnings conference call, which I am currently on, the total number of subscribers has gone up to 7.4 lakh users on Shine.

During the quarter, HT Media paid an advance to Firefly e-ventures Ltd against an issue of equity shares amounting to Rs. 5 crores, as well as a loan of Rs. 3 crores. Remember, HT Media has intended to spend Rs. 150 crores in Firefly over the next 2-3 years.

Also note that Go4i.com shareholders have been allocated 22,600 HT Media shares of face value Rs. 2 each to shareholders during the quarter, post a court ruling.

Print - HT Media claims Mint is the number 2 paper in Delhi, Bangalore and Mumbai, in its segment. Interestingly, newsprint costs a serious cause for concern; raw material cost for HT Media increased 10 percent QoQ. Hindustan was launched in Dehradun and Chandigarh. HT Media tied up with German Media Group Hubert Burda to set up a printing facility
Radio - Fever 104, has around million listeners across Delhi, Mumbai, Kolkata and Bangalore
Music - HT Music has also received a loan of Rs. 10 crores from HT Media.

Note: Any questions for HT Media? I am currently on the earnings call. Do leave a comment or tweet on Twitter

Q1-09 Call: OnMobile Partners With Vodafone, GroupM For Ad Ring Back Tones; Local Advertising, CPC Model, 25-30 Pc Revenue Share

OnMobile Global has tied up with Vodafone to pilot advertising supported ring-back tones (Ad RBT) in India, and has inked a strategic partnership with media buying agency GroupM to bring advertisers on board. Arvind Rao, Chairman of OnMobile said during an earnings conference call that the pricing will be such that an Ad-RBT does not cannibalize on the the revenue shares for both operators or OnMobile - the ARPU will remain the same. Mouli Raman, CTO of OnMobile said that the revenue share from Ad-RBTs for OnMobile, will be between 25-30 percent. Rao mentioned that the company will be targeting local advertising - shopkeepers, restaurants - the proverbial long tail. They estimate that the Ad-RBT could be as large as 1/4th-15th the size of the advertising market.

Cost-Per-Click Model?

The revenue model hasn’t been frozen yet, and OnMobile is still testing the service. But some inputs on the pricing - Ads will have different rates based on the level of profiling and the number of exposures. The money will be split between the sales commission agent, the operator and OnMobile. If you’re press #* while listening to an ad, you will be delivered an m-coupon or an SMS with additional information. So the company can charge, dynamically, much higher rates. For an unprofiled customer, the rate would be X. For a slightly profiled customer, the rate would maybe be 3X. “If it’s a highly profiled customer, we could charge 10x,” Rao said.

Users who deploy the service will be offered either free talktime, free SMS, wallpapers etc. Initially, the advertising will be based on the called party, but eventually they will also incorporate ads based on the calling party too.

Download AdRBT specific excerpts from the call (9MB)

Telisma (acquired by OnMobile for around $18 Million)
Has marginal losses as of now, and had revenues of 3Million Euros (around $4.6 Million). Rao said that replacement of Nuance with Telisma will not save OnMobile money, but it will help them gain access to international markets like Africa and Asia by developing language models for specific countries and languages. Replacement of Nuance with Telisma is not going to happen overnight - it’s a live system with 30-40 million users a month, and “we need to test and improve the product before deployment. We’re not buying a product, but a technology. It’s going to take a while for the technology to have an impact on the bottomline and topline.”

Download Telisma specific excerpts here (6MB)

Inputs on Revenue Breakup, Phone Backup, Sachet pricing of RBTs - (more…)

RCom VAS Revenues At Rs. 109 Cr/Month; Non-SMS VAS At Rs. 91 Cr/Month; 60 Pc Of Data Card Market

VAS Revenues
As per calculations done by MediaNama, based on data given by Reliance Communications in its quarterly performance report, the Non-SMS component of Wireless Value Added Services (VAS) accounts for 84.2 percent of total VAS revenues for RCom. This contribution is up significantly from 75.43 percent for the same quarter last year.

For the quarter ending June 2008, RCom’s Total Wireless VAS revenues were Rs. 108.81 crores/month, up from Rs. 100.16 crores/month for the quarter ending March 2008. and 68 crores/month for Q1 last fiscal. Growth in Non-SMS VAS (Ringtones, CRBTs, GPRS, Voice Portal Services etc) was 10.7 percent, increasing to Rs. 91.63 crores/month from Rs. 82.74 crores/month for the last quarter.

IMPORTANT: Please note that RCom includes both Mobile and Wireless Local Loop (WLL) subscribers in its Wireless numbers. Hence RCom’s performance indicators are not comparable with those of other operators like Airtel and Idea Cellular.

Download the quarterly performance report here

Overall Results
RCom reported a net Profit of Rs. 1,512 crore, and revenues of Rs. 5,322 crore, at an EBITDA margin of 42.3% (up marginally from 42.2%). Wireless revenues (excluding access charges, license fees) at Rs. 31280 million, down 1.5% from Rs. 31757 million last quarter. Broadband contributed 9% to revenues, as compared to 8% last quarter. Net broadband revenue at Rs. 481.5 crores, up 8.8% from Rs. 442.40 crores last quarter. (Net revenue excludes access charges, license fee etc)

Mobile Subs, MOU and Churn
– Wireless - 50772888, up from 45793676
– GSM Wireless - 8065455, up from 7016205
– CDMA Wireless - 42707433, up from 38777471
– Wireless marketshare - 18%, up from 17.9%
– Prepaid customers - 90.9%
– Wireless Churn - 1.4%
– Minutes of Use - 424, down from 430

Broadband
– Claims 60% of USB Data Card market
– Operational in 18 service areas, 42 towns
– Acces lines - 1,147,000, up from 1,031,000
– operating in 44 cities, 821,000 buildings
– Added 117,000 lines in the quarter, down from 130000 in the last quarter
– Average Revenue Per Line - Rs. 1715, down from 1760
– RCom claims to have a presence in 23,000 towns and 600,000 villages.
– A branded retail presence in 1300 towns, have over 500,000 retailers

Global
– 1.7 million customers for Reliance Global Call service, accounting for 40% of retail market calls from US to India
Broadband - and almost 1.15 million access lines

WiMax
– have begun deploying WiMax stations in top 10 cities in India (WiMax 802.16d)

Related:
– Earnings: Idea Cellular VAS Revenues Increase in Q1 2008-09; VAS ARPU At Rs. 24.74
– Airtel Mobile VAS Revenues At Rs. 235.55 Crores Per Month; Non-SMS 57% of VAS At Rs. 133.56 Crores Per Month

Q1-09 Results: OnMobile Paid Over $18 Million For Telisma; $20 Million Revenues, $3.6 Million Profit; Nepal Operator RBT

OnMobile Global paid as much as 12 Million Euros (around $18.7 Million and Rs. 78.9 Crores) for French speech recognition company Telisma S.A. That’s an amount not too distant from the consolidated revenues that OnMobile has reported for the first quarter of this fiscal - Rs. 86.3 crores or $20.46 Million - and a fairly significant bet on the technology. Telisma has a speech recognition technology available in 10 Indian languages - Hindi, Bengali, Tamil, Gujarati, Punjabi, Kannada, Telugu, Malayalam, Marathi, and English - and OnMobile plans to deploy it with operator clients over the next 2-3 years. Whats interesting is that the company signed a deal with Nasdaq listed Nuance for voice based search in 15 different languages.

With revenues of Rs. 86.3 crores, OnMobile has reported, on a consolidated basis, a net profit of Rs. 15.2 crores for the quarter ending June 30th 2008 (Q1-09); the EBITDA (excluding other income) is at Rs. 20.9 crore. The company says that margins are lower this fiscal, primarily due to payouts to VoxMobili shareholders. Also, they’ve adopted a revenue share business model for VoxMobili’s phone-backup service in Asia, instead of the previously adopted one time license, which brings in lower initial returns, but more long term revenues. Over 10 operators have signed up for the Phone Backup service.

Download: Financials | Release | Annual Report for 2007-08

On a standalone basis - OnMobile, excluding its subsidiaries - has seen revenues increase to Rs. 72.77 crores, up from Rs. 50.27 crores Q1-08, profits increase to Rs. 14.5 crores, from Rs. 11.88 crores in Q1-08

During the quarter:
– RBT: signed up with the largest operator in Nepal for Ringback Tone (RBT) deployment; Received Letter of Intent for RBT deployment with UAE operator; launched Ad supported Ring-back tones with an operator
– MSearch: voice based search launched with Vodafone, Reliance and Tata, generating 1 million searches a day
– SMS based search launched with one operator, and is generating 8000 searches a day
– Phone backup: received a Letter of Intent from an operator each in Bangladesh and Sri Lanka

No mention, yet, of the story we had broken earlier this month:

– OnMobile Global Inks Exclusive Mobile Music Deals With Around 40 South Indian Labels

Q1-09 Results: Media Share Of CyberMedia’s Revenues Declines; How is CyberMedia’s Online Business Doing? Technology Review In India

While Sify a bulk of Sify’s revenues now come from the enterprise segment rather than the consumer segment, specialty media house CyberMedia appears to be leaning more towards the Media Services space than the Media business. This is apparent from revenue split, which indicates the growing dominance of the Media Services business - at 51 percent, up from just 32 percent for the same quarter last year.

CyberMedia has reported a consolidated operating income of Rs. 32.9 crores, up from Rs. 22.89 crores for the same quarter last year; CyberMedia India accounts for just Rs. 14.86 crores of this operating income on a standalone basis, up marginally from Rs. 14.44 crores for the same quarter last year.

The Media Business
CyberMedia has recently tied up with MIT’s Technology Review Inc to bring the EmTech Conference to India (focused on Emerging Technologies) to India - and also launch the Technology Review magazine. The conference will be held in early 2009, and the magazine will be launched at the conference. For CyberMedia India (standalone), this segment has contributed Rs. 14.93 crores to revenues, at a profit before tax of Rs. 1.47 crores, down significantly from Rs. 2.28 crores for the same quarter last fiscal.

Historically, Print has been the dominant component of revenues in the Media segment - which consists of Print, Online and Events. An increase in the newsprint cost appears to be a key issue. However, there very little mention of online business. CyberMedia has 15 publications, 12 websites, an events business, and two weekly TV programs. Earlier this year, they acquired the stake of their JV parter in UBM-CyberMedia LLC, for the outsourcing publication brand “Global Services”. Other publications in Media segment include: InfoTech (Dataquest, PCQuest, ciol.com), Telecom (Voice&Data), Consumer Electronics (Living Digital), Biotech(BioSpectrum), Entrepreneurship (Dare) and Legal (Halsbury’s Law).

The Media Services Business
Some of the growth in the media services business can be attributed to the acquisitions that CyberMedia has made over the past year - in March, they acquired the US based TDA group, which provides marketing consulting, content development, web and graphics design to the IT industry. The Media Services segment also comprises of IDC India - a telecom and IT research company, and Publication Services Inc, a content management company which they acquired in December 2006. So CyberMedia has strengthened its Media Services business over the past year.

Note: We’ve contacted CyberMedia founder and Chairman Pradeep Gupta for details on the online business, and also inputs on CyberMedia Dice/Careers, which recently shut down.