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BUSINESS:
DOTCOMS
The
Empire Strikes Back
The
giants of the so-called old economy are expanding into Internet in a big
way, steamrolling some of the pure dotcom companies and blurring the distinction
between the old and the new economies.
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| "The
flushing out has begun. The days of lavish spending are over."
SUNIL LULLA, CEO, Indya.com |
If a portal
existed simply as an intermediary between producers and consumers-say,
a website selling different brands of television-it can easily be snuffed
out if the producer sets up its own portal and reaches the consumer directly.
Warns Ranjit Limaye, CEO of IBM India: "The old economy companies
are moving into dotcom at the rate of knots."
Many dotcom
companies are already adjusting to the reality by exploring and expanding
the common ground with brick and mortar companies. Indiaproperties.com,
which defines itself as a real estate e-market, is working aggressively
with property brokers, construction firms and architects to create a community
of all those involved in real estate. Explains Naresh Malkani, e-managing
director of the portal: "We provide a new means of doing old business.
We complement, not substitute, the existing players of the real-estate
business."
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| "Net
companies forgot that habits don't change as fast as technology."
M. SAWHNEY, Professor, Kellog Graduate School of Management |
Star TV has
recently bought a 20 per cent stake in Indiaproperties, which along with
the promoters' money, should suffice for the next 18 months. By then Malkani
hopes to start making profits.
That may
be a tall order in the Internet business where six months define a generation
and, as Sawhney says, futurists turn historians in less than a year. But
then that's the lure of a business so refreshingly powerful as the Internet.
The big Net players are now betting on year 2003 when the Internet is
expected to reach 20 million people in India, up from less than three
million now. Aiding such expansion would be the spread of the Internet
outside the personal computer and into television, cellular phones, palm
tops and other hand-held devices.
Predicts
John Sculley, the marketing czar who had led Pepsi and Apple Computer
to trailblazing success: "The Internet will empower consumers, redefine
work and revolutionalise technology, all at digital speed." The combination
of technology and high user base will generate enough income-and hopefully
profits-to justify millions being poured into the Internet businesses.
If that sounds like a big gamble, remember the Internet right now is 90
per cent gambling, 10 per cent planning.
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In
India, youth is marked by impetuosity and prevented from getting ahead.
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