Rediff released its Q2 results last week which indicate a slowdown in ad revenues for India’s largest portal. As per the release the Indian revenues by 5.5% on a year on year basis in Rupee terms, but due to a weakening of the Indian Rupee vis a vis the US Dollar, this growth translated to a 2% decline in US Dollar terms.
On the whole the quarter has ended with rediff reporting a net loss of 0.42 million $ or approximately 2 crores. This quarter has been a transition quarter for rediff with the launch of two key initiatives in the Developer Platform and Rediff Social which we have decoded as rediff’s move to be a social portal and the second and the most recent initiative of MobileRediff which though coming a tad late is still come at a time when mobile gprs users are at a nascent stage and GPRS is just catching on the Tier 1 and 2 cities and towns which by far would form a large chunk of rediff’s audience.
Rediff has to be wary of In.com a player that seems to be fast encroaching Rediff’s yet unchallenged position as the largest horizontal player in the Indian market. Web18 has got this far with in.com due to both a good inhouse capability as well as via aggressive acquisitions. Rediff on the other hand has just got active on the funding and acquisition scene with vakow and Tachyon technologies. Given that it has a cash kitty of over 49 million dollars I wont be surprised if it goes the acquisition way to compound growth.