AOL is the new portal in town

AOL’s launch next week is sure to create ripples in the online industry in India. A look at the industry’s expectations from the entry of the media giant

The Indian Internet story gets yet further validation with the imminent entry of the US-based online giant, AOL. It’s not surprising then that all eyes are on the $7.9-billion behemoth, which will launch its India operations tomorrow.

While there have been enough twists and turns in the AOL story globally, the fact is that the company, which is owned by Time Warner, is the third-largest online ad network in the world. That’s making the domestic industry sit up.

Both the company and its expected competitors are tight-lipped about the new offering. According to reports, a youth portal is on the cards and it could be hosted on www.aol.in.

Most publishers believe that having AOL in the industry will lead to greater interest in Internet advertising. The general opinion is that there is “room for growth” for AOL and it does not really pose a threat to the existing players.

According to Mahendra Swarup, chief mentor of the Smile Interactive Technologies Group, “The Internet industry needs large publishers. Most of the top publishers today do not have the technological capabilities of AOL to give a boost to the industry.”

An obvious concern with AOL is whether it will churn out content to suit the local palate. This seems unfounded as the company is launching a youth-oriented portal, a sure-fire way to drive traffic, given Indian demographics.

AOL is also on an aggressive hiring spree in India, according to industry insiders. Maneesh Dhir was appointed executive vice-president of international operations in January 2007, and is expected to play a leading role in the Indian operations of the company.

Since AOL is part of the global NBC Universal-News Corp. video distribution network, it will be interesting to see what its video advertising plans in India are. Sanchit Sanga, business director, Interactions (a part of Group M Media), remarks, “It is expected that AOL will focus heavily on audio-visual content and that sounds exciting. Currently, content on websites is rather static. However, this is dependent on bandwidth, but if AOL changes the content delivery platform, it will help it in competing with the much touted TV content.”

AOL turned around its fortunes last year after it announced a new business model based on advertising, and made all its services free to users. This led to 400 per cent growth. The company is expanding its online ad network and has opened up its offerings to developers. Yahoo! has also tasted success with its Panama advertising network and Google has big plans for DoubleClick.

With AOL’s entry heralding a battle between the ad networks, the online space has just got that bit more interesting.

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