Web18: The Indian CMGI or IAC?

Entities Mentioned

• Network18
• Lycos
• Match.com
• Web18

1. Web 18, the internet subsidiary of the Network18 group is the 800 pound gorilla of the Indian web.
   
   Among the sites that the conglomerate has a stake-in includes: StoreGuru (E-Commerce), Tech2 (Technology News), Josh18 (Hindi Portal), EasyMF (Mutual Funds), CricketNext.com (Cricket News), CompareIndia (Shopping), Homeshop18 (Home Shopping), Buzz18, Entertainment News, Indiwo (Women’s Portal), Jobstreet (Careers), BizTech2 (Business Technology News), CommoditiesControl (CommoditiesNews), Yatra.com (Travel), BookMyShow (Movie Tickets), UrbanEye Media (Web Design), not to mention one of India’s most popular news sites CNN/IBN’s site (ibnlive.com). Many of these web properties are homegrown initiatives while others are acquisitions. For any company in the Indian consumer market, Web18’s presence must be recognized.
   
   Web18 reminds me of the two similar American conglomerates from the dot-com days: CMGI (College Marketing Group Information) and IAC (InterActive Corp). However, only one of these groups flourished and the other is barely alive.
   
   CMGI invested in many web properties during the dot-com boom including 1stUp.com (Free Internet Service Provider), Altavista (Search Engine), Lycos (Portal), Freemark Communcations (Free Email service), Furniture.com (Furniture Shopping), BizBuyer.com (Small Business marketplace), Tribal Voice (Chat Service), Snapfish (Photo printing), MyFamily.com (Geneaology), Chemdex.com (Chemical E-Commerce), Geocities (Webhosting), Alibris (Online Books), Domania (Real Estate Search). CMGI peaked in the dot-com boom with share price of $163 and total market capitalization of $40 billion in 2000. Two years later, the stock was worth less than $1. CMGI currently has a net worth of $582 million.
   
   IAC owns more than 60 properties. For a full listing see: http://www.iac.com/businesses.html including Ask.com, Excite, Match.com, Home Shopping Network, Evite and TicketMaster. Though IAC stock has declined in recent years, it is still a major player in the global internet market as the 8th largest network of sites with 153 million visitors per month and a market capitalization of $6 billion.
   
   Given this, the question is Web18 headed the way of CMGI or IAC with their spurious launching and acquisitions of web portals? Unlike CMGI which was at the core a venture group, IAC grew out of an actual business – the Home Shopping Network. Similarly to IAC, Web 18 grew out of an actual viable business --- news broadcasting. In addition, Web18 is attempting to enter home shopping with sites like Homeshop18 with the possible intent of replicating the IAC model.
   
   My bet is that Web18, instead of become a pool of arbitrary web acquisitions, will leverage its diverse web portfolio to continue to dominate the Indian internet as the more users come online in the coming decade.
   
   Please comment and let me know what your thoughts are on this matter.
   
   
   

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