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Dot-Coms and the Making of an Overseas Territory >> 123

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the global consulting firm McKinsey and Co. These transnational flows
and alliances were of critical importance for fledgling dot-com companies
based in India because their association with industry leaders in the United
States gave them the credibility and symbolic capital that in turn, led to more
contacts and sources of funding in countries like the United States. Further-
more, between 1999 and 2001 several prominent NRI venture capitalists and
entrepreneurs were directly involved in incubating Internet businesses and
India-specific websites both in India and abroad. 30
A third important variable that lent the “Indian” dot-com sector a dia-
sporic bias was the business model that defined valuations, cash flows, and
venture capital funding on the basis of a “user commodity” constructed
using a set of metrics including page views and the number of unique visi-
tors to a website. The highly publicized acquisition of Indiaworld.co.in by
Satyam Infoway (Sify, based in India) is illustrative of how this exceedingly
narrow notion of a “user commodity” shaped the business logics and iden-
tities of “Indian” dot-com companies. On November 29, 1999 the CEO of
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Sify announced a $500 million acquisition of Indiaworld.co.in. Not only
did this help Sify gain $600 million in market value, improve its profile in
the NASDAQ listings, and consolidate its position as a powerful Internet
corporation, it also made the NRI community the most sought after “user
commodity” for other dot-com companies that were seeking funding. Even
as speculation raged in business circles about Indiaworld being overvalued,
with many raising the question of how “NRI eyeballs” would actually trans-
late into dollars, it was clear that Sify’s investors (at the time, 41 percent of
Sify was owned by foreign investors) were attracted by Indiaworld’s posi-
tion as a leading NRI-focused portal that included twenty-two India-related
“channels.” As Rajesh Jain, CEO of Indiaworld explained, “Indiaworld has
secured a unique position with overseas Indians. On an average, it generates
13 million page-views per month. And that was the basis for the valuation
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and the price paid for it.” Continuing problems with connectivity and low
rates of credit card usage in India were also cited as key reasons for dot-com
companies to focus their efforts on NRIs.
Sify’s acquisition of Indiaworld was followed by a dramatic period of
growth. According to a NASSCOM report (National Association of Soft-
ware and Services Companies), by April 2000 three new India-centric web-
sites were being launched everyday and close to 23,000 domain names with
Indian addresses had been registered. This boom lasted just over a year.
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By May 2001, Business World, the “magazine of the new economy,” reported
that only six dot-com companies could report profits and fifteen others
appeared to be “on the path to profitability.” Among these survivors were
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