BT Dot.com: What's Hot! [Pg.2]

"I am Sure We Will Ride It Out"

Joe Silva, CEO, Caltiger: time to log out?

Two years ago Joe Silva, CEO of India's first-and only-''free" ISP Caltiger, was on top of the world. Today he is fighting to stay afloat. He took time out to talk to BT's Debojyoti Chatterjee on what the future looks like for Caltiger.

Q. What exactly went wrong with Caltiger?

A. Nothing and everything. The very concept of Caltiger came at a time when the ISP business was looking extremely attractive and the initial response to providers like Satyam was clearly very positive. Most of our advisors and financiers were extremely gung ho about the product and service we were about to provide. The revenue models based on advertising and other value-added services looked very good, too. It is unfortunate things have not worked out that way.

Is Caltiger an exception or is it just another victim?

In terms of performance it is not an exception. We are doing as well as any other Indian ISP. Even global giants like AOL is not exactly making money. In that context our losses are quite conservative, and the fact that we are privately-held makes things a little easier. On the other hand, the downturn or rather the market's inability to take off as projected by the pundits has come in the way of generating cash flows. We were definitely looking towards an ipo but the picture does not quite look rosy right now.

And what in fact marred the ISP business in general?

Primarily the lack of connectivity. Despite plenty of big talks from the government, connectivity remains an unsolved issue. Another bottleneck has been the slow penetration of the access hardware in the Indian market.

But the over-banking on ad revenues also came in the way...

To a certain extent, yes. When we started off everybody was talking of the ISP sector being a major growth area for the ad business. Unfortunately it has not been so. We have to move from a free ISP provider to a subscription-based one and also look towards providing other value added features that will justify our charges to the consumer.

Like...

Well, we are still on the process of planning them out.

What happened to your undersea cabling network plans?

With the state of funding we are in, the plan is on hold but it is still very much on our list. Currently, we are looking at getting into the business of providing webcasting services and that looks like a very lucrative avenue. Though we have made some initial progress on the front, it is still too early to comment on.

Also, we are venturing ahead in our lesser-known software operations. We operate on the internet software sector have been able to leverage Caltiger's domain expertise. We have an extremely dedicated team of software professionals and currently are generating revenues to the tune of $50 million per year.

What about finances?

That's one thing we don't like to talk about. Nothing at all. We will go public when we are ready.

Finally, is there a future for Caltiger?

Of course, there is. But it's tough and I am certain we will ride it out.

Wired Wisdom

Thou Shalt Celebrate
THE BOOST FOR M-COMMERCE

Four giants, Amex, MasterCard International, Visa International and Japan's JCB have formed a ''Mobile Payment Forum'', which will address issues like interoperability, passwords, cardholder authentication and encryption methods. That's a big boost to the faltering mobile e-com market. Last May, a survey by industry researcher A.T. Kearney found that only about 10 per cent of all cell phone users planned to use the mobile Internet to make purchases, down from an estimated 33 percent as of June 2000.

Thou Shalt Mourn
THE GREAT VC DOWNTURN

Waiting for second-round funding? Well, dig this. In the US, only 9 per cent of venture capital-backed companies eligible for second-round funding got them in the third quarter of 2001, says industry researcher Venture One. That's in contrast to the heady days of 1999 when venture capital seemed everywhere. Entrepreneurs must also wait longer. The median time from initial to second-round funding in Q3 is up to 14 months from nine months in the boom period.

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