Prescience, not projection
The gender split of the Net is also displaying interesting trends. In the US, 49 per cent of the users are women. It is estimated that globally, 54 per cent of the new Netizens of the next year are going to be women. The US-centric nature of the Net is also slowly but surely changing. The US currently accounts for 43 per cent of the Net users. In India, Internet usage is estimated at between 4 million and 5 million. The bulk of this population accesses the Net from office and are male. However, this will definitely change and the female population and home use will both grow. The estimates for Internet usage projections in India go all the way up to 75 million by 2003, according to a Goldman Sachs report. This of course is based on the growth of alternative delivery mechanisms like cable TV - given that there are about 30 million cable homes in India. So in a sense it would seem as we are still poised on the initial portion of the adoption curve with a huge wave to follow. All of this means that in the fastchanging environment, prescience and not projection of the past will be a marketer's key weapon.

Portal mania
Its numbers and predictions like the one above that has led to portal mania in India. Definitely, the valuation stories have helped. Mania is perhaps a word too mild to describe what we have seen in India, following the US, in the last 12 to 18 months. You know what WAP is.

Well, welcome to the YAP world-Yet Another Portal. This insidious trend is borne of the need of all websites to be called portals-probably to qualify for investment.

And the blind belief of almost all companies that all it takes is to put up a website/portal with the right name and some content and they can sit back and watch the money pour in. It is difficult to predict when the growth will plateau out, and at what level, but it would be a safe bet to say that 80 per cent of the new portals will not be around at that time. They will close, flame out or be bought by stronger players. In fact, the growth of the online players is in many ways dependent on their ability to swallow the smaller ones.

Lessons from Yahoo! and AOL
In fact, along with Yahoo, AOL stands out as one of the two most successful portal models. An interesting difference is that Yahoo was born of the Net, while AOL is in fact a business model that predates the World Wide Web. The Web just gave AOL the fillip it needed to get up there. What lessons can we learn from these models?

The lesson from AOL: size does matter! In fact, a critical size gets you into the virtuous cycle of eyeballs, commerce, better deals, more partners, etc. You have to be the "last man standing." AOL started early. In from the time the World Wide Web burst open, AOL started to gobble other Web firms.

In 1995, it purchased WAIS, GNN and Web Crawler, which gave it greater muscle into content and search capability, right up to Compuserve, Netscape and the recent Time Warner deal. AOL has had quite a diet. The Yahoo mesage: Simplicity counts. So does information. Yahoo began as a personal index of 2 students at Stanford. Till date, as debates rage about stickiness and what usability on the web, Yahoo's interface is clearly a benchmark for simplicity and function.

Common Lessons: get strategic investors aboard. Softbank for Yahoo. Before IPO. 1996. It's not the money that counts. It's the colour of the money.

Money is not always the same. Investment from a blue chip investor goes further. Focus on the key metrics. Whether its revenues, page views, registrations, revenues, expenses, analysts have used all of these at some point of time or the other. It's important to know what's working now. That is, if you can't predict what will work tomorrow.

Web advertising revenues
Pardon the apparent oxymoron. Advertising on the web is a highly skewed market with the top 10 per cent of the Websites accounting for a disproportionately high share of the ad dollars. So the rewards for being in that elite cadre are unfairly high. All this implies that its not a game for the weak-hearted. There won't be small winners and losers here. There will be mega businesses, flame outs and big consolidation moves. The stronger ones will gobble the weaker ones - this process will be like a natural evolution. Instinctive, ruthless and patterned.

It has been suggested (by people of the calibre of Mary Meeker) that as dot.com's flounder in general, the stronger ones like Yahoo flourish as the ad revenues get even more skewed towards the big names.

Markets: Whither bound?
There was a time when markets rewarded value-value for customers and value for shareholders. This equation seems to have been battered around over the last few months. It's a moot question whether markets are reacting to industry or vice versa most of the time. The biggest public influencers are no longer the politicians, actors or sports people. It's the analyst. People like Henry Blodget or Mary Meeker can change the course of companies, with every sentence they utter. This will also change.

This is not to say that we are any better off with anybody else impacting our opinions. But simply to say that markets must ultimately reward industry. Not play God. Today's scenario is a little bit like the plot of Irwing Wallace's novel, `The Almighty' where the media baron creates news by hiring a group to actually commit crimes for which the news is pre-planned.

Today's market men create the hype that builds fortunes which they are party to. That is definitely a flawed system. The answer? Don't follow today's market. If you can look into tomorrow go for it. Else follow customer value.

It's content! It's commerce!
Content stands in the corner today, the dethroned king of the Internet. Commerce is clearly enjoying its moment in the sun. But let's not speak too soon because the wheel, as they say, is still in spin. And there really is not telling who it is naming. For the multitude of media companies who have tried to get into the portal game, content has as often been a head-start as a millstone. Content is tougher than it looks, and we have not yet really understood how content is best delivered, as we race into the worlds of wireless protocols, Internet devices, broadband, and convergence of data, voice and entertainment networks.

And while the question mark hangs over the viability of the advertising model for revenue out of content, it can only mean one thing. A rush into commerce. Through financial, travel and other services. Through products.

Through alliance-driven models. Worldwide, Yahoo, Lycos, AOL are all creating their shopping sites. They may stumble and trip. But they will not let go of that all important shopping cart. The thing is, commerce goes way beyond the website. It needs fulfilment, delivery, returns, customer redressal and many other non-web arms. Successful portals will need to span these as well.

The changing portal space
ISPs have traditionally been a source for the birth of portals. In India, Satyam, Mantra, VSNL, BPL Net, ZeeNext, Caltiger and Wipro, are all players looking to combine the ISP business with a portal.

Some have built their own eyeball models, like Mantra, while others like VSNL have bought into content businesses (Indiainfo.com) andstill other's have acquired entire content companies. Satyam with its purchase of Indiaworld, is an example of this. Media companies are also always going to fancy themselves as portals.

But successful models may need to go across media - web, print, radio, and television content. Shakeout? So will there be shakeout and consolidation in this market? Like any other crowded business full of over valued companies? Sure there will. Valuations have gone the full circle. We're back at the doorstep of revenue and profits. So what does it all add up to? Net net, as they say, it's time for the Internet to get real!