Media 8.0 | Meet Joe Blo: virtual transformation

It is a fair guess that as you read this, chief executive officers of Indian online firms are feverishly trying to figure out how to take a few days off from counting the money to take a year-end break. It has been that sort of a year.

First came Buyukkoktten. A Google Inc. engineer of Turkish origin put together a social networking website and, thankfully, called it after his first name. Orkut has more than 8 million users in India; that’s probably one-fourth of all Indian youth online. It already has its share of love, sex and hate groups—and the cops are most distressed they can’t do much about user-generated content.

Then came Zuckerberg. Harvard student Mark Zuckerberg whipped up an application to connect with his classmates and that has since grown into the monolith called Facebook, with more than 50 million users worldwide and a $15 billion (about Rs59,250 crore) market capitalization (Microsoft Corp. put up a quarter of a billion dollars for a puny 1.6% stake).

Media 8.0: Escalating audience fragmentation was matched by proliferating media options in 2007. While traditional media spaces such as print and television saw major shifts, radio in its FM avatar made a remarkable re-entry. But the most dramatic developments were in the virtual world of digital marketing. All this has set the stage for an eventful year ahead.

Billion for Bikhchandani. The New Silicon Valley boom is quickly followed by the New Okhla Industrial Development Area boom. Sanjiv B. of Naukri.com lists his company, Info Edge (India) Ltd, on the exchange, and within months it crosses the $1 billion market cap—the first for a dot-com in India. This sets off a flurry of let’s-get-ready-to-list activity among the bigger Internet firms in India. The private equity guys come in swinging big chequebooks.

Good news/bad news on the cellphone. The good news is that more than 200 million Indians—one in every six—have cellphones. The bad news: Operators have their heads stuck in the sand and the phones are only used for voice, while the huge potential in data and value-added services (VAS) remains squashed. VAS companies are still unviable, even in a low-cost, high-volume market such as ours.

Big advertisers are getting it. Google won’t tell you this, but its revenues in India have likely tripled in the last year to more than Rs200 crore. At Pinstorm, we think the total amount spent online by advertisers is well over Rs600 crore this year—which is about twice of what it was last year, and about half as much again as what we think it’ll be next year.

Big ad agencies aren’t. The mainstream agency network has missed most of this boom with very little of this money going through their air-conditioned offices in Lower Parel, Mumbai. But they’re now trying to buy the digital independents that are getting away with it.

The big winner is Shri Joseph Blo. Real value is being delivered online. To real people. Joe Blo is buying his bus tickets on Red Bus, air tickets on Yatra, selling and buying cars on Carwale, and trading on tips through Sharekhan. The world isn’t changing, it has changed. And it has changed at the most basic level—inside the consumer’s head.

Each year, a few trends gain momentum and reach tipping point. The mobile phone is one such change of recent times. Will 2008 be the year of the Internet? It promises to be an interesting year as a lot of the hype around blogs, consumer-generated media, Web 2.0 settles down; as the lines between the mobile and the Internet blur; as technology seems less overwhelming to the masses. The great thing that 2007 did was take away the fear of technology from many. Thanks to networking websites such as Orkut, people who would never venture beyond their email boxes are “poking” each other on Facebook. So, what to expect in 2008? Here’s my list:

Internet marries the mobile: Affordable handsets allowing EDGE and WLAN connectivity, combined with huge penetration of mobiles, would likely ensure that more and more people are consuming the Internet on the go.

Always-on Internet: High-speed connectivity through mobile, exponential increase in Wi-Fi hot spots and talk about rapid deployment of WiMax, all promise always-on Internet connectivity.

Life shifts online: We are romancing the government with online filing of tax returns; applying for passports online; meeting friends online and enjoying peer-to-peer gaming. What’s more, the Internet is fast becoming the new operating system—you don’t need software, just a device to access the Internet.

People power: People will continue to create, share, influence content like never before. Websites such as StumbleUpon, Digg, Del.icio.us, and people-powered search engines such as Mahalo are adding power to how people find and consume content.

Going local: Local is the new global, they say. From weather to restaurant ratings, local is the flavour and many are making attempts, sometimes precipitously, to gain a piece of the pie. Likely winner? You!

Blogging matures: Blogging will see maturity; less in number but focused, purposeful. They will become a serious publishing platform with mainstream media adopting them.

Social networking rules: General networking websites will continue to penetrate deeper. On the other hand, focused networking websites will gain ground in a big way.

E-commerce impact : Always-on connectivity, targeted marketing, expected proliferation of payment methods would mean e-commerce is likely to see exponential growth.