The first time i heard a buzz in the market with respect to HT acquiring a social media site was 30th November 2007 post a report on contentsutra. contenders included myindospace , Jhoom , Hi5 and surprisingly no one mentioned Desimartini…… but as it turns out Desimartini it is.
How big an impact is this going to have on HT and its presence on the Internet remains to be seen but i am striving very hard to come up with advantages and strength factors but just not able to.
The deal is reportedly under 10 Million USD but a quick calculation gives us the following – HT has paid around 40 USD , or 1600 INR , per user acquisition ( taking 10 million for the deal and divided by the registered DB of 250,000) ….. now i might not have a very strong financial bent of mind….but who else thinks this is a bit crazy… 10 million really seems to be a “bit” too much..and i agree with Rajesh from alootechie on this totally. Its far too expensive considering the quality of the overall inventory or the users which social networking sites typically tend to have.
Additionally how does this help HT out. Sure they have a online property now over and above what they have but i am very curious to know the path which they have . hopefully , laid down to leverage this… is it purely an acquisition to control and try and take a bigger bite out of the online spends in India…. are they planning to possibly sell the DB , use it for internal marketing… ?
Amit Garg might be under the impression that this fortifies their entry as far as the Internet is concerned but 3 out of 4 people who i brought it up with burst into giggles. To quote him “expanding our Internet base” , and that it might appear they are getting into the Scoial networking a bit late but that the Internet is still in its infancy in India….basically stating that its ok as far as the timing is concerned.
The problem lies in the fact that everyone is unsure where social networking is going to go and secondly Desimartini was never really a contender, in my opinion, within this genre of sites to begin with. So i dont see the point, the advantages and hope that HT has not made a blunder. While Mr. Pahwa’s ROI has definitely skyrocketed all that it appears to be for me right now is another traditional media company getting into something without a comprehensive understanding of either the industry and the vertical.