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Archive for the ‘internet’ Category

Media measurement – In a state of perennial mess

Posted by Arun Uday on August 27, 2007

“Lies, damn lies and statistics” is an expression that aptly fits the media measurement industry across the board cutting across all media types. Right from the oldest media form – print to the newest – internet and all the intermediate ones (television, outdoor etc), procuring precise statistics for audience related information has been as fruitful an exercise as chasing a mirage on the hot desert sands. What’s even more surprising is that this is getting progressively worse and not better with technology advancements. Lets just focus on the two most important ones here – television and internet.

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Posted in internet, media, media ratings industry, technology, television | Leave a Comment »

Behavioral targeting – hotting up

Posted by Arun Uday on August 14, 2007

I notice that not too many people talk much about Hotmail these days. It appears that given the plethora of “Ajax based” and other popular email services such as Gmail and Yahoo! mail, Hotmail seems to have taken a backseat. Yet, I would rate Hotmail as one of the epoch making events in the evolution of the internet. Reason, it basically heralded a new economic model, which has since become a key characteristic of the interent era, which is to offer a service free of cost to the end user, and monitize it by means of advertising. And with time, this model too evolved and became more sophisticated, and now, in a sense we seem to be back to where it all began, thanks to how things have shaped up and led us to what is now being called behavioral targeting.

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Posted in behavioral targeting, internet, internet advertising | 1 Comment »

11 immutable laws of internet branding, now 9?

Posted by Arun Uday on July 25, 2007

I recently picked up a book at an airport bookstore called “The 11 Immutable Laws of Internet Branding”. Completed it over a couple of flights. The part interesting and part disappointing aspect of the book, as it turned out was that this was a pretty old edition. From the pre-Google era, so to speak. So, it was disappointing since I was expecting to read some contemporary stuff. But, the interesting bit was that it was a little like going back in time and get insights into the thinking back then. Read the rest of this entry »

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Growing Print in India = Depressed Internet?

Posted by Arun Uday on June 11, 2007

Amongst the many things an MBA education aims to do, one of the most important is to acquaint the student with certain frameworks and concepts that come in handy to analyze businesses, companies and industries.  And one such framework that every b-school grad no matter which part of the wide world she hails from will almost certainly be aware of is Michael Porter’s Five Force model for analyzing industries. Probably, it is to corportate strategy, what Markowicz’s portfolio theory is to investing or the 4P framework is to marketing. Porter’s framework is a way of analyzing how attractive an industry is on a macro scale. For more, read this wikipedia article.
One of the “five forces” in Porter’s framework is what’s called the “Threat of substitutes”. A possible substitute for a product or service makes the industry susceptible for downturn or even ultimate demise depending on how much overlap there is between the incumbent and competing substitute and how attractive the choice of substitute is. In the technology world, we see substitutes wiping out incumbent technologies all the time. The best example of this was how the birth of the PC, which was (more than) a substitute to the electronic typewriter resulted in the death of the latter. Similar examples could be cited w.r.t CDs/Floppy discs, iPod/Walkman, Broadband/Dial-up etc. Read the rest of this entry »

Posted in internet, print | 3 Comments »

Facebook entering a new phase

Posted by Arun Uday on May 28, 2007

The big news in the social net world last week was Facebook’s announcement that they were going to open up their platform to third party application developers. For those wondering what the big deal is (after all, almost all web sites these days provide APIs to interact with them), this is a little different. In this case, application developers can develop widgets that will work within the FB system. FB promises that this will be an open system and there won’t be any elaborate clearances that would be required. The third party applications are promised full access to the entire database and will be free to monitize their work in any manner they want.
There has been some amount of excitement and may be even hype around this announcement with some even suggesting that this could pave the way to FB becoming the new OS of social networking. Lets try and analyze this briefly. Read the rest of this entry »

Posted in Facebook, internet, social networking | 1 Comment »

Aggregators – New King Makers

Posted by Arun Uday on May 23, 2007

“Content is king” – is perhaps the most hackneyed phrase in the media world. However, some time back, a Bear Sterns analyst came up with this v.interesting report, which said that content aggregators are the new king makers. I have looked at and also helped prepare a few aggregator business plans in the past, and here is some of that learning.
First Learning – Content aggregation plays make most sense when there are many players on both supply and consumption side. The classic case is that of a user generated content aggregator like YouTube, where there are thousands of producers and millions of consumers. An aggregator is an indispensible part of the value chain in such cases. Quite often, we see aggregators hoping to pull it off by striking deals with a couple of content producers like large studios and getting started. We are especially seeing this in the case of the innumerable IPTV/VOD/movie download service providers in the US. And predictably, most are skating on thin ice and having to change their business model (Akimbo) or struggling to survive (Netflix downloads). As an investor, I’d be wary of backing such an aggregation play. You are always under the risk of the large content supplier(s) either pulling the plug or deciding to do it themselves. You obviously also can’t hope to earn extraordinary margins in such a business since the content provider, who has the maximum bargaining power would take a lions share of the revenues.
Second learning – Build a brand. It seems obvious, but somehow, especially having seen some of the mobile VAS content aggegators here in India, I feel that their focus has hardly been in building communities (proxy for brands). An active community / brand could be a major barrier to entry especially when operating amongst large players on either side.
Third learning – Don’t just loosely aggregate. Add value. Contrive novel ways by which you could ease content discovery or help users make new connections or engage users in discussions. This is again best illustrated by the example of how YouTube managed to hold its own against Google Video. It was all the various bells and whistles – Play Lists, Recommendations, Ratings etc that YouTube built which eased the discovery of content and fostered the building of a community, which made it the most popular video aggregator on the planet.
OK, here’s a question – Which is the largest aggregator on the internet, which is the best example of having accomplished all of the above? Clue – answer starts with a “G”.

Posted in internet | 4 Comments »

Internet in India – Still “Nice to Have”

Posted by Arun Uday on May 21, 2007

Generally speaking, there are two kinds of products and services – the “Nice to haves” and “Can’t do withouts”. Talking specifically in the context of India, one way of looking at the market here is that it becomes attractive only when the product or service graduates from the “Nice to have” to the “Can’t do without” category. There are advanced markets in the world, where even the “Nice to have” consumer base is large enough to sustain businesses on those themes. But, India being a value conscious market, as an investor, I’d be interested only if I see that a product has the potential to become a “Can’t do without” in a reasonable time frame. And I feel, internet in India, is still largely a “Nice to have” rather than a “Can’t do without”. And here’s the reason why.
I am not really so worried about the infrastructure issues like relatively high h/w costs or the lack of penetration of bandwidth etc. There is ample evidence to suggest that such issues pretty much get addressed with time. Rather, if there is any one problem that’s really been a stumbling block for internet adoption in India, it is the lack of compelling applications for the domestic market. Some of the analogies that people typically give in connection with the expected boom in Internet in India are two similar waves in ICT sphere that we have witnessed in the past viz. – the cable and mobile revolutions. Read the rest of this entry »

Posted in India, internet | 3 Comments »

Social networks and India

Posted by Arun Uday on May 3, 2007

So, finally, after all that animated discussion about social networking in India (see here and here) where two very eminent VCs took opposing positions on social networking in India, we finally see the first actual serious investment in this space here. Sequoia has just announced an investment in Minglebox, the supposed facebook of India. Honestly, I do believe that both parties have merits in their arguments. I think it is quite clear that running a purely ad supported internet business in India is not a sound proposition. According to some estimates, the total display advertising in India is pegged at under USD 50 million. In contrast to that, the US internet advertising industry is worth USD 17 billion. The difference is in orders of magnitude. Thats the reason most of the internet successes (apart from large media plays like Indiatimes or Rediff) in India till date have not been in the “fun” domain, but in the “utility” domain (job sites, matrimonials, travel etc), where some end consumer actually pays a fee for the service being offered rather than depend on advertising as a means of monetization.
Hence, in my opinion, the key would be for such sites to actually open up “new” revenue streams other than ads to make it work. Of course, thats more easier said than done. From what I know, not too many of these social nets even in the US have opened up many other revenue streams, and ironically, for some reason, the click through rates for Facebook have been the worst of the lot.
So, that leaves us with the question, what could the gameplan for a site like Minglebox be? They have raised USD 7 million, and even assuming a dilution of 50%, it implies a valuation of USD 14 million. That doesn’t seem cheap by any means. Will keep a keen eye on how that story develops from here on.

Posted in India, internet | Leave a Comment »