Indiainfo.com seems to be out of its self styled hibernation for the year, throughout which it has been carrying out cost cutting measures. The company expects to breakeven in January 2002, according to the CEO of the company.

Bangalore: This year has been just the opposite for indiainfo.com when compared to 2000. In stark contrast to the hyped up promos of early 2000, this year the portal, partly due to the dotcom bubble-burst and partly because of its own errors in business model, went into a self-styled hibernation. After a year that saw several rounds of trials and slicing down most of its fat, the company officials now claim that it is all set to bounce back, albeit slowly and cautiously.

Indiainfo.com co-founder and chief executive B G Mahesh is confident that the company would achieve operational breakeven in January 2002. "That is when our revenues and expenditure would be at Rs 36 lakh," he told CIOL Bureau in an exclusive interview. Throughout 2001 the company has been carrying out the exercise of cutting expenditure and streamlining its revenue sources.

What had gone wrong earlier? According to Mahesh, "We had `guesstimated' the opportunity based on Internet penetration and a couple of other things in the agenda. Based on this we went on an investment and spending spree. Following the dotcom crash and market pummeling, we realized our mistakes and took measures to continue our service."

The company claims that some of the steps taken to reduce cost against revenue earned have been positive, as the operations cost has been reduced from Rs 70 lakh in April 2001 to Rs 40 lakh in October. Subsequently, the revenue has increased from Rs 11 lakh during April 2001 to Rs 32 lakh during October. Incidentally, the operational cost during September 2000 was Rs 2.5 crore. The company had ended its financial year 2000-01 with revenue of Rs 1.53 crore incurring a loss of Rs 21.37 crore.

Indiainfo closed down its e-commerce division having 160 employees in Mumbai as early as third quarter of last fiscal. Next it closed a couple of channels and verticals, which were not being received well by the readers. Also, the company relocated its office to economically viable locations across Mumbai, Delhi and Chennai. And shifted its regional activities to Bangalore.

"What we have done is right sized our company from 350 people in September 2000 to 104 employees as of today. We have also lowered operational cost and identified our strength in content, services, utilities, community and traffic," said indiainfo.com's vice president for strategy and alliances, Giri Balasubramaniam. On the organizational front, indiainfo rationalized its structure, and structured itself to meet revenue opportunity with a more focused approach. Content was made into a product to be sold. "We embarked on a process what we call SWIFT (Strategy, Win-win, Innovation, Focus and Teamwork). We continue to enhance and strengthen our content in channels, verticals and vernaculars. In areas where we lack our domain knowledge we have signed alliances with leaders in the respective spectrum," Giri said.

Some of the working revenue models for the present includes ad sales, annual fee based alliances, career India subscriptions, e-mail marketing, co-branded alliance from indiainfo and e-commerce. Advertising sales continue to contribute 50 per cent towards its monthly revenue as of today.

Mahesh said that Internet is here to stay, thanks to the NRIs, Indian vernacular portals continue to be viewed, content will continue to attract the surfers and corporates are being forced to establish their presence in the Internet. These are going to be the driving factors for Web sites and portals to survive in this market. He said, "Our page views have increased from 3.5 million in December 1999 to 95.1 million in September 2001. With our page views increasing by the day, we hope to convert our productivity to profits by the beginning of next fiscal."

With future plans being frozen for the next six months, the company will not create but consolidate and benefit on the existing opportunity. Mahesh, therefore, kept himself away from making any projections on the 2002 revenues and business models. "We will focus at keeping a check on the expenditure and ensure that it is at least equal to our revenues," he added. The company is trying its best to be around when the next Net boom happens.

By Ranjeet Rayen

Home

More...