The Smart Techie was renamed Siliconindia India Edition starting Feb 2012 to continue the nearly two decade track record of excellence of our US edition.

May - 2009 - issue > Guru Talk

Whither Internet Advertising in India?

Satya Prabhakar
Wednesday, May 6, 2009
 Satya Prabhakar
This is déjà vu all over again. Once again, the Indian Internet industry, like in the early years of this decade, is convulsed by less-than-spectacular consumer growth and depressed advertising revenues. But character and good businesses are built through times of tumult and tribulation, not ease and quiet.

The Internet space in India can be categorized into four categories:

* Content and Basic Service Providers: This include horizontal and vertical portals that focus on providing manufactured content across multiple interest areas such as news, movies, finance and travel and basic services such as email, stock quotes. (e.g., Yahoo, Rediff, Sify, Indiatimes) This also includes social sites such as Facebook, Orkut and others. The revenue model for these sites is almost entirely through display advertising by large brands.

* Search Providers: This include general purpose and niche service providers (e.g., Google, Yahoo, Live and Ask.) These sites earn revenues mostly through cost-per-click adwords.

* Local Commerce Providers: These are sites that focus on enabling chiefly two functions: enabling users to transact amongst themselves, and enabling users to find local businesses (e.g., Sulekha, Naukri, Shaadi) These sites earn their revenues through user fees and response advertising of small to medium businesses (SMBs).

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