How blew $50 million

I told ’em it had to happen sooner or later, and as it turned out, it was sooner. The portal, which seemingly had money coming out of all its orifices, has lost 80% of their staff, including the CEO, CFO, chief of content, technology chief, etc. and is now down to just 25 people. From “the ultimate home for Indians” down to a portal for Star TV’s TV shows is indeed a big fall.

Last year in April, did something nobody had ever done before. They paid an insane amount of money (estimates vary but most people think it was around Rs. 2 Crores, about $400,000) to The Times of India (print edition) to buy out their entire front page and turn it into an ad for their portal. They also hired Sunil Lulla, the former General Manager of MTV, as the high-profile CEO.

Some people called it excellent branding. I just called it a foolish way to blow lots of money.

But money wasn’t really a problem for After all, they’d suckered, er, convinced the great Rupert Murdoch himself into parting with $50 million for a 33% stake in a portal, which was going to be in the business of content for the unexplored areas of news, astrology, romance, weather, sports, contests, polls, blah blah blah (yawn!). Certainly nothing that hadn’t been done before. Which makes me wonder how naive Rupert made his billions. If he could be so gullible, perhaps I should try and sell him my concept: I’ll sell plain old rocks to the ten or so people around the world who want them. Hey, I could eventually turn it into a “community” site. Imagine the revenue potential in that. C’mon Rupert, show me the money! I’m happy with just $1 million. I deserve it more than that trickster Pradeep Kar, on whom I’ve already lavished praise for his illusion-weaving powers.

I tried to explain to some people that there was absolutely nothing new about what offered. Anything that they had, people like Rediff, Sify, IndiaInfo, IndiaTimes, [insert favourite portal here] already did. “The focus of the portal is to get sticky eyeballs through advertising, sponsorship, marketplace, transactions and merchandising”, said Lulla. Their very expensive advertising talked of their “attitude”, but this didn’t affect the content at all, which was pedestrian. They offered different colour schemes for their site, which was about all that was “new”. So, yes, the Times ad got people to their site, but there was nothing to keep them coming back; and certainly nothing to make people switch from their favourite site. In fact, it was a great example of what I call YAP syndromeYet Another Portal.

Lulla kept making grand statements about the future of, about how they’d make money in three years, how they would enter the broadband market in 2002, how they would get into interactive content, how they would make money by changing to an “online transaction-based charging model“.

And then the trouble started. The layoffs began. had hired over 220 people since April 2000. In July, they fired 20% of them. Apparently, their profitability maths still didn’t work out, so in August, they fired another 35%. Oh, the things you have to do to save money. If only they had saved a bit of money from their wasteful advertising, it would have paid the salaries of some of these poor employees. And now, 80% more have “quit” (as everyone knows, that means they were asked to leave). The “ultimate home for Indians” portal is no more than a site for Star TV shows.

What a way to blow $50 million in a year and a half.

The man, the brains behind this grand venture, Pradeep Kar, now says he doesn’t want to get into any more “pure Internet ventures”. That’s a big reversal for a man whose official company biography reads:

Pradeep Kar is the Founder and Chairman of the Microland Group – a leading player in Indian Digital Economy. A true industry pioneer, Pradeep understood and sought to harness the impact of the Internet long before it was recognized as the transformative force it is today. Based on this keen vision and a proven ability to identify untapped market opportunity, Pradeep has served as the primary architect of Microland Group – today, a diversified technology services company focussed on software and infrastructure services

Well, the “pioneer” sure doesn’t sound very enthusiastic now, does he?

2 thoughts to “How blew $50 million”

  1. hahah…well… said man… actually i was part of this system i mean the tag “MICROLAND” few months before….but now currently safe somewhere…you know what…the second phase of this history has already begun and they are half way into it what we call as “sinking ship”.
    True it is “History repeats itself ”

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