Rediff - Will it Survive the Dotcom Bust?

            
 
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Case Details:

Case Code : BSTR010
Case Length : 7 Pages
Period : 1995 - 2001
Organization : Rediff
Pub Date : 2002
Teaching Note : Available
Countries : India
Industry : Media and Entertainment

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Background Note

Rediff was set up by the advertising agency, Rediffusion-Dentsu Young and Rubicam in 1995.

With 5 journalists, 3 technologists, and 2 designers, Rediff set up India's first web-server from its 800 sq. ft office in Mumbai's Fort area. Initially Rediff posted a newsmagazine and the site reported 1 mn hits in the first month. Most of the hits were from the US, from the first-generation Non-Resident Indians (NRIs). Balakrishnan then re-positioned the site as an access-point for all India-related information. Chat services were introduced in early 1996. The early-mover advantage seemed to have worked in Rediff's favour. Apart from The Hindu's online services,3 Rediff was the only source of Indian news on the Net in 1996. Rediff then looked out for companies interested in advertising to an NRI audience. Hindustan Lever and Ranbaxy accepted the offer.

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Since these companies did not have websites to start with, Rediff got into site-building.

Once again, the first-mover advantage helped Rediff. By the late 1990s, Rediff had built about 70% of the Indian sites. Rediff unfolded its e-commerce strategy in early 1998, when it became clear that e-commerce would soon be available to Indian consumers. On August 15, 1998, Rediff launched a bookshop, music shop, and on-line hotel-reservations, backing it up with free e-mail and homepages. In May 2000, Rediff and Orange (Mumbai's leading cellular service provider) announced a strategic alliance to launch the wireless applications protocol (WAP) service. This enabled people to browse the Internet using mobile phones. Orange customers could access Rediff content on their mobile handsets...

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