Agreesive move by Sify says analysts
Wednesday December 15, 8:58 am Eastern Time
FOCUS-India Satyam, ICICI in Internet deal
By Narayanan Madhavan
NEW DELHI, Dec 15 (Reuters) - India's first private Internet firm, Satyam Infoway, and financial services group ICICI on Wednesday announced an on-line joint venture aimed at pooling their strengths in a ``clicks-and-bricks' alliance.
The U.S. Nasdaq-listed Satyam Infoway Ltd (NasdaqNM:SIFY - news) and ICICI Banking Corporation Ltd , the banking arm of ICICI Ltd (NYSE:ICd - news), said their alliance will offer retail banking products and services over the Internet.
Like India's traditional arranged marriages, both partners have strong corporate parents who made the match.
Called icicisify.com, the 50-50 venture will target the business-to-business market on the World Wide Web to which Satyam, parented by Satyam Computer Services , will bring its Internet skills and ICICI its retailing expertise
``We have clearly said bricks alone would not do...If clicks is the future, we are with a strong partner who can provide the clicks,' K.V. Kamath, managing director of ICICI Ltd, told a news conference.
``Clicks-and-bricks' refers to the integration of firms which specialise in the Internet with established companies that deal in products and services.
VENTURE TO ENABLE ONLINE DISTRIBUTION OF RETAIL PRODUCTS
Satyam officials boast of having 13.5 million page views per month because of its major basket of Indian content portals acquired earlier this month.
ICICI plans to ``data-mine' its three million bond holders in an attempt to identify the most lucrative potential Internet customers.
The partners said the venture, expected to put ICICI Bank's products on line in about three weeks, will enable online distribution of retail products including savings, deposit accounts, electronic payments and services.
Satyam Infoway said the implementation of the alliance was subject to completion of definitive documents and receipt of required regulatory approvals.
Analysts said the joint venture would put the two companies in a strong position ahead of the anticipated entry of global players like Yahoo Inc (NasdaqNM:YHOO - news) and ExciteAtHome (NasdaqNM:ATHM - news).
``They want to put themselves in such a position that it becomes dificult for foreign players,' said Osama Manzar, chief executive of 4cplus.com, which tracks the Internet economy.
Manzar said Satyam was also moving aggressively to ensure that it was seen as more than an Internet service provider.
The bank said Satyam Infoway's buyer-to-seller ordering website, SeekandSource.com, and ICICI Bank's payment module will be offered together so that users and customers can complete the entire transaction and payments online.
ICICI Bank will also set up automated teller machines at Satyam's access points and cyber-cafes as well as offer Satyam Internet terminals at its branches for visitors, it added.
Satyam is hoping to grow the Internet market in India by setting up 100 cybercafes by March.
Kamath said he expected 50 percent of the anticipated traffic to come through cybercafes.
``For us it was a great fit to promote e-commerce on a B2B (business-to-business) portal,' Ramaraj said.
He said the new business-to-business portal's tie-up with ICICI will be exclusive in nature, but its other e-commerce portals like carstreet.com and walletwatch.com will proceed independently.
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