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STAR grabs control of indya.com

Priya Ganapati in Bombay

News Corp, which owns the STAR TV network in Asia and several big newspapers and TV channels in Britain, Australia and the United States, has bought out the stake of Pradeep Kar and the other shareholders of indya.com The STAR network now completely owns the portal.

The development means that Kar, founder of the Microland Group of companies which had set up and run indya.com till now, will have no stake in the portal any more.

"I believe that a closer integration with News Corp would be essential given the trying market times. Given this reality, I, along with Microland and other shareholders, have decided that our dream of indya would get realised by relinquishing our shareholding in favour of News Corp/STAR," Kar wrote in a letter to his employees on Thursday.

"This would enable News Corp/STAR to put all its global resources behind indya, thereby resulting in increased benefits for the customer, the user and each of you. And more importantly, aggressively propelling indya into a dominant leadership position in the marketplace," he added.

indya.com was launched with a splash, grabbing the entire front page of The Times of India for an advertisement.

The portal has since launched a number of services and had recently tied up with STAR TV for a section on the wildly popular show on the STAR Plus channel, Kaun Banega Crorepati.

In recent times, indya.com has had its fair share of hiccups. A few weeks ago, the company axed 40 people, or nearly 20 per cent of its staff. The portal has never revealed details of its users and page views.

Kar said the move to sell his stake was an overall effort to streamline operations. "This is another step in our consolidation phase wherein we would focus all our energies to be a diversified technology services group providing end-to-end technology services to global customers," he wrote to his staff.

For the STAR network, this acquisition of indya.com will push it a step closer to its dream of having television and the Internet on the same screen.

After taking control of the Bangalore-based indya.com, STAR plans to unveil a combined Internet and television strategy for advertisers which, company officials say, could serve as a role model for Rupert Murdoch's ambitious Sky Global Network platform.

"We started out with 37 per cent (in indya.com). Now we have nearly all of it," Gary Walrath, executive vice-president of STAR Group Ltd, told a press conference.

He said STAR had invested $50 million for the 37 per cent stake it had acquired earlier, but said the increased stake was at a much lower valuation. The earlier stake was acquired before a worldwide slowdown hit the Internet sector.

indya.com plans to combine with Hathway, a cable network in which STAR has a significant, undisclosed stake, to bring a potent mix of entertainment, content distribution, interactive services and e-commerce.

"When he [Murdoch] sees something he believes in, he simply sticks with it," said Lalit Ahuja, STAR Group's executive liaison.

STAR had bought out stakes held by Chase Capital, the ICICI group and key individual investors in indya.com, Walrath said.

The investors included former chief of Apple Computer Inc, John Sculley, and India-born venture capitalist Vinod Khosla, one of Silicon Valley's most influential figures.

It is not yet clear to what extent the Microland Group or Kar will be involved with indya.com "On behalf of Group Microland, we will continue to support indya.com in every which way we can, and it will always have our blessings, our confidence and our good wishes in building itself towards leadership," Kar said.

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