In May 2000, Man’s World ran a cover feature with the headline: “Is anyone not setting up a dotcom?” The piece grappled with the seeming contradiction of a rapidly growing dot-com economy even though the number of Internet users within India was very low during the same time period. One paragraph in particular pointed to the yawning gap between the promise of cyberspace and the everyday realities of “third-world” India where a majority of the population had no access to the Internet:
This country has about 1 million Internet subscribers, perhaps 3 million net-enabled users in all. If they were all in Bombay, that isn’t even every fifth person. And yet, every billboard in Bombay is taken by a dotcom. India this, Info that, My Search Engine, Your Personal Email, Woman Power, Man Power, Kiddie Power…it boggles the mind…the magazines the boys at the signal push at me, the newspaper my vada pav comes wrapped in; they are all full of this alone. All the signs point to the Internet and the World Wide Web, the brand new virtual world where lives and fortunes will be remade.
We now know that this apparent contradiction between low Internet usage and a booming dot-com sector is best explained by the fact that the development of the commercial Web in India had a distinctly diasporic bias. By diasporic bias, I mean that dot-com companies and the websites they created relied on and leveraged the Indian diaspora in first-world countries to become both commercially viable and culturally significant. NRI eyeballs, to put it a bit crudely, were what mattered. We also know that only a handful of the hundreds of dot-com companies established during this time managed to survive and some are still struggling to make money.
Ever seen a boom that is more about spending than earning? Where very few are making money but everybody is itching to invest? Well, we are in the middle of one. Favourite adjectives for the state of the media industry today are: booming, galloping, taking off.
The only difference is, Ninan is talking about the TV industry and not dot-coms. In the piece, she outlines how the television sector in India has gradually become a market cap industry in the sense that all round faith in the media sector is attracting investors even though they are fully aware that very few of the new entrants have managed to turn profits over the past few years. “Entire bouquets of new channels are now materialising with fat budgets reserved for advertising campaigns to establish them,” writes Ninan. Even a very well-established brand like “NDTV” has not translated into profits. And the similarities to the dot-com moment don’t end here.
How do we explain the success of TV companies that are making money (UTV and CNBC-TV18, for e.g.)? As in the dot-com case, there are two key factors: economies of scale and reach, and the ability to deliver compelling content that, in turn, helps construct and sustain a stable “audience commodity.” Ninan also provides a good overview of other stakeholders who will play a role in shaping the structure of the TV industry in the near future. More here.
p.s. Most of all, this reminds me of the first con-job in Bunty aur Babli – the one where Bunty convinces a petty financier to invest a small sum of money in a news channel!