On the HT Media earnings conference call, Amit Kumar from Investec Capital asked the companys management whether there is any plan to close down Shine.com. Shine.com went live on March 26th 2008, and the business was launched in 2007. Kumar pointed out that Shine.com has been “consistently loss making and scalability, profitability in the business has been very difficult to come by. Is it of any plan or any sort of thought on closing it down now?”

Piyush Gupta, Group CFO at HT Media responded by saying that “I think that is a great question. Though we do not give forward [looking] statement, but I can tell you that in the next few quarters, a few things that we are experimenting on this particular business will bring it back to a reasonable level of health. I am not saying that is going to go gangbusters here, but I understand it has been a long time. But you also have to have a perspective that in most of these digital businesses,the monetization is very tough given the incumbent is a strong player. Also,the job market has been exceedingly soft for the many, many years now. However,suffice to say that we are doing something in the next couple of quarters. In any case we will bring down the cash burn position.I think if we just fast forward our plans,in the next couple of quarters we just might be positively surprised.”

Amit Kumar: “Sir I am just asking this question sort of theoretically, but you have sort of experimented quite a bit with this business in the past as well. So assuming that these next set of experiment over the next three, four, six quarters do not sort of pan out the way it is expected, and the business sort of still does not either both in terms of scalability and profitability meet the benchmark, can we expect that you will sort of take some action and close this out? I know it is theoretical;I am sort of putting you on a spot here but in 10 years…”

Piyush Gupta: “You are not putting me in a spot at all. I love these kinds of questions.I totally get it. But we are as concerned as you are and that is the reason I said we will do something which will bring it back, but that is all I can say at this moment.”

The competition in question here is Info Edge owned Naukri.com, which, from what I remember faced questions from investors about the challenge from HT Media before Shine.com launched, especially because of the media power that HT Media brought to the table, while Info Edge had to spend to market. A few months after Shine.com went live, Info Edge was asked about competition from HT Media in an earnings conference call. Our note from that call:

[Shine] is not really in the market because. A Rs. 15 crore adspend is less than half of what we spend in a year. A database of 1.5 crore CVs and 45000 mods everyday, and 15000 new CVs every day…I think Shine is still at a fraction of that. If you look at our database – we have double the number of CVs in our database than the readership of the Times of India. I don’t see the media power of HT being useful to them in any way.

Given that Shine.com is yet to turn profitable, and Info Edge has grown its profit fairly consistently over the years, it’s fairly clear that HT’s media power hasn’t brought in comparable scale or profitability.

But Gupta’s point is well taken: when there is a strong incumbent in the market, it’s difficult for a smaller player to compete. Info Edge itself faces that challenge: on an Info Edge earnings conference call, after the company said that in the market there is only room for top two players and the third is always going to struggle, I had followed up by asking the company about why they remain invested in Jeevansathi.com, which was (and still is) number 3 among matrimonial sites, and has only intermittently been profitable over its existence.  Info Edge CEO Hitesh Oberoi’s response (as per my story then) was that ‘the matrimonial segment comprises of multiple markets, and strength in one segment, doesn’t necessarily make you strong in another. Info Edge has decided to focus on north and west, in which they have a chance of making it to the top spot, even if they are number three nationally.’

Shine.com claims to be the number two in the recruitment market in India. In its annual report for the last fiscal, the company said that it “already holds No. 2 position in the database segment. It holds more than
three lac [300,000] job openings on its site and the total number of job seekers is more than two crore [20 million]. In FY 2016-17, Shine.com has shown a revenue growth of approximately 30%, compared to the previous year.

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None of this comes remotely close to THAT Rediff concall though.

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Source: HT Media earnings conference call