RealTime IT News

Indian Portals To Take Off By 2000

The Internet portal market in India will take off in Year 2000, according to Internet analysts in the region.

"The online consumer mass market and the opportunities for portals in India will take off within two years," said Abhishek "Abhi" Chaki, the director of research for bandwidth and access strategies at New York-based research group http://www.jup.com/">Jupiter Communications.

"We view India as a critical market in the long term for our research and advisory consulting services in connectivity and content," Chaki said, on a recent visit to India.

Thirty to 40 Internet service providers are likely to commence operation in India by the end of the year and boost the domestic user base, according to Ravi Sangal, director of market research group http://www.idcindia.com/">IDC India.

The domestic Internet base amounts to about a million users now, according to a recent issue of Business World magazine. India's http://www.nic.in/got/">new telecom policy, focusing on convergent voice and data communications, is currently in the draft stage, and is expected to open the gates to even more ISPs.

But as in many other Asian countries, most Indian sites do not draw sufficient proportions of traffic from within the country. A recent issue of Asiaweek magazine noted that Asian Internet users still tend to visit North American Web sites much more than local Web sites.

There are no Indian sites which enjoy the global status or international traffic flows on the scale of a Yahoo! or AOL, said Sangal.

"For some time to come, traffic on Indian portals--even on local sites-- will remain small in comparison to traffic originating outside India," he said.

It is unlikely that regional language portals will be launched in India by the end of the year, Sangal added--a position countered strongly by Arun Natarajan, an Internet consultant and journalist based in Chennai.

"The local language portal does make a lot of sense--after all, you don't have to take on Yahoo, AOL-Netscape and MSN in this space," Natarajan said. India has over a dozen official languages and more than 400 dialects.

But many Indian language publishers are still grappling with issues like developing downloadable fonts to give away to users. Among local languages online, Tamil seems to be the most likely to be offered on a portal.

"A large percentage of India's software engineers--whether working in India or abroad--are of Tamil origin. This can bring in lot of support for e-Tamil efforts," Natarajan said.

A lot of notable contributions have been made by Indians based in countries like Singapore on Tamil "e-fonts." Two major national ISP players--Satyam Infoway (which has already commenced operations in a dozen cities) and Dishnet--are based in Chennai, capital of the state Tamil Nadu.

London-based http://www.world-tel.com/">WorldTel is currently involved in a project for large-scale use of Tamil content via the creation of about a thousand Internet community access centers in Tamil Nadu.

The state also has proactive politicians actively pushing for the importance of Tamil in Internet software and content development. It is organizing a two-day conference next month called TamilNet '99, promoting standardization of the language for use in computers and its development on the Internet.

But Indian portals hoping to offer free e-mail and homepages face challenges in making them superior to those available on U.S.-based sites like Yahoo and GeoCities, said Natarajan.

"It also remains to be seen whether the Indian portal wannabes understand the importance of tie-ups, co-branding, e-commerce relationships and even outright buy-outs, and not try to do everything themselves," he added.

Many Indian ISP's are contemplating portal strategies. But portal strategies have had mixed success for ISPs in countries like the U.S.--though AOL and Earthlink have been very successful with their portal plays, the telcos have not been as successful, according to Jupiter's Chaki.

"The key is to partner with players whose core competency is developing or managing online content - there are a lot of online media players in India, and ISP's should work with them to develop relevant content and portals for their services," Chaki said.

Indian publishers like http://www.indiatimes.com/">The Times of India Group and http://www.digitalht.com/">The Hindustan Times have launched first-generation portals drawing heavily on their own content.

The market for Indian language portals will mature only if local language sites grow in strength first, he said.

Though there is likely to be a good future for regional portals, such portals would fare better in English than in local languages, predicted Rajesh Jain, managing director of Mumbai-based content aggregator http://www.indiaworld.co.in/">IndiaWorld .

Portals in India may fair better if they focus on niche or vertical areas; the current crop of newspaper-driven portals merely rehash content from their print versions, Jain observed. Portal content needs to be relevant for local users too, and not just for non-resident Indians.

"Online revenues for Indian content sites and portals in 1999 will be largely from advertising as compared to e-commerce, probably 90:10 in favor of ads," he said.

"But year 2000 will see the emergence of e-commerce, which will then account for 30 per cent of online revenues," Jain predicted.

E-commerce revenues in India this year will amount to about $14 million, and then grow to $51 million in year 2000 and $162 million in year 2001, claimed IDC (India)'s Sangal.