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| July 10, 2000 | ||
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| CYBERCHATTER Watch the Rain Tree By Samar Halarnkar
Little wonder that each of the 2,000 or so dotcoms -- no one knows for sure -- that have sprung up in the last year are now anxiously watching what happens to Rediff's foray into the capital market. Rediff may have deep roots but it trembles frequently in the weak top soil. Amidst rumours of a recent cash crunch so severe it disabled top-level salaries, Rediff, on June 14, went ahead with an initial public offering (IPO) of its equity on the tech bourse of the world, Nasdaq. It is the first independent Indian dotcom to tap the world's premier money market (sure Satyam Infoway was the first dotcom to list on Nasdaq, but it doesn't count because it has access to the deep pockets of the highly profitable Satyam Computers). Well, Rediff raised $55.2 million (Rs 248 crore), selling 4.6 million shares. When this article went to print, its stock was running at $18.62 (issue price, $12). But before you start Nasdaq-dreaming, bear this in mind: during the year ending March 2000, Rediff incurred a loss of $6.7 million (Rs 30 crore), a rise in sync with its growing popularity and services. A year ago, that loss hovered at $985,000. And Ajit Balakrishnan, Rediff's go-getting, optimistic CEO (I guess he can't be otherwise) will openly tell you he doesn't expect to turn a profit in the next two years -- at least. Rediff's business is growing, don't doubt that. Revenues were $1.9 million in its latest quarter, up from $855,000 in the same period last year. This spiralling growth is no assurance of survival, but it is a good predictor. "Critical mass is very important," says Sameer Gehlaut, 26, an engineer who launched a retail financial services company called indiabulls.com in May. As thousands of dotcom newbies like him realise, the importance of economies of scale are as important in the virtual world. To keep going until those economies translate to cash in the bank, IPOs in the home of Silicon Valley could well be a critical source of money once venture capital funds run out. So how is Rediff's IPO being accepted by the American investor? "The risks of focusing on an Internet portal for India are high," notes the Internet Stock Report on the respected internet.com. "However the advantage of being a first mover can bring great rewards if the Indian Internet market increases as expected." Watch Rediff -- and this space. Conversational Computing If keyboards and mouses turn you off, don't worry. Pointing, clicking and hitting enter isn't the future of surfing or of operating those funky palm pilots and WAP phones. So what is? Your voice. Voice-enabled devices are getting so sophisticated you can now navigate your way through certain sites by telling them what to do. You can check your voice mail and e-mail by asking for it (www.conversations.com). If you want to see the future of conversational computing, check out Samsung's wrist phones just hitting western markets. NTT of Japan has one with an earphone unit with separate microphones: one that picks up the user's voice through airborne sounds and another that picks up voice via conduction by the speaker's facial bones. Download Suggestion Do search engines irritate you with their dumbness? Get Kenjin. It's a clever little (1.5 MB) piece of free software that sits in the form of a toolbar at the bottom of your screen, watching what you do. As you work, it quietly suggests (six at a time) sites and news stories related to what you're doing. Other cool features: each time you mention a company name, it can give you stock price and company news; you can even get help from the Kenjin community, people writing about the browsing the same subjects across the world. Check out www.kenjin.com/download2.html Samar Halarnkar is general manager (content services) of India Today Group Online. He can be reached at samarh@india-today.com |
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Five
years is a long time for a company to survive without turning a profit --
yet command a deep respect. Rediff.com, India's largest web entity
with about 70 million page views a month (13 million a year ago), does
just that. In India's Internet jungle, it is a sturdy rain tree with roots
cast deep into a fragile top soil sustained by venture capital cash. This
money has thrown up a profusion of forest-floor mushroom dotcoms that will
shrivel with the first dry season. The great dry is not too far away. In
five years time, only 20 Indian dotcoms will survive, says a new study
from credit-rating agency ICRA in Mumbai.