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Q409 Sify Call: Video Content And Advertising; ePort Turnaround

No numbers from Sify Technologies on their portals business in the earnings call, though the company did comment on broad advertising trends:


Sify’s online advertising revenues have declined because previously large advertisers like matrimonial, job and travel businesses have held back spends. Sify did say that this has been offset somewhat by a new segment of advertisers, particularly lifestyle, automative, telecom and others. The other key trend is that online advertising has moved to performance based from a CPM (impressions) based model.

Video Content and Advertising

What came as a surprise to us, is that Sify claims to lead in the entertainment area with video content from movies and music videos. They didn’t mention whether they were leading in impressions, inventory or revenues. Sify is leveraging lower costs because of their data centres and network for hosting and delivery. “The focus on games, entertainment and sports inaddition to news and lifestyle has led to new users coming on board in the last year” the company said. Sify says that they’ve had success with reality tv shows and live streamig of Cricket matches – including the India New Zealand series, Australia – South Africa series and West Indies – England series. “We’re offering video advertising successfully to our advertisers and gaining revenues,” a company representative said on the call.

Please note that Sify gave no indication of whether there has been an overall increase or decrease in their user base, advertiser base, nor have they given a split of their consumer revenues between business segments. Sify consolidated its access and portals business into a consumer division. We’ve requested Sify Chairman Raju Vegesna for an interview for better clarity on how the business has been doing, and are awaiting a response.

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E-ports Turnaround

The E-ports business saw a slight increase revenues in the month of March, a change from the decline that the business had been witnessing. This is due to Sify choosing to “relocate, renew, rationalize and refocus the business to make it viable for franchisees.” they’ve closed unviable cafes, and leveraging content alliances and focusing on revenue earnings opportunities.

Value added services in alliance with content partners like microsoft, in cos in education, travel space, in addition to search and email, like apps for applications to universities abroad, matrimony, and jobs will be main sources of revenue in the future. Consolidating efforts in cities which have strong eport representation so that promotions become more cost effective. in interactive services, improvement of cMS and delivery platform has resulted in reduced cost in content and people.


Sify claims that they rationalized broadband products, and addressed churn in their broadband services. They intend to now hold price, and offer consumer more – for example, more value at times when bandwidth consumption is low, like at night. They’re also looking to leverage relationships with PC manufacturers to have their connections bundled, despite the fact that PC sales have slowed down.


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Sify has identified opportunities in Pharma, Tech and Education verticals, and are also targeting federal, state and local government bodies. They’ve developed a learning management system, and will focus on higher learning, and delivery efficiencies because of pricing pressure.

Enterprise Business And VoIP

The Enterprise business drove growth for Sify, though the company did mention that they’re facing pricing pressures. The claim to be a a fully operational long distance operator for wholesale voice, with a steady increase in business. The company expects VoIP carrier and Data center services to be the drivers for growth in enterprise business. PSUs are investing in IT Infrastructure, and govt invests in IT Enablement across departments, and this is a key segment. Sify has strengthened its sales force in US and Europe, and are looking at alliances. Lead times are longer, though.


The companys focus was on greater efficiency and consolidation during the quarter, and they say they will continue to review costs across infrastructure, operations and people. 

Related: Q4-09 Results: Sify Reports $16.85M Loss For FY09; Revenues Up 3%

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