Five Net portals in Asia forecast to stay by 2004

HONG KONG, 26 May 2000 (Manila Bulletin) - Only four or five successful Internet portals will remain in the Asian Internet sector by 2004 after a period of savage consolidation, global investment bank Morgan Stanley Dean Witter said in a report Wednesday.

Morgan Stanley Dean Witter expects that these successful portals would experience outstanding returns.

"Asian portals could be worth at least 17 billion US dollars in market capitalization by 2004," said Sunil Gupta, executive director and head of Asian Internet research for Morgan Stanley Dean Witter.

"Successful portals will be built on brand, scale, scalability, technology and crucially, quality content," he said.

Morgan Stanley believes advertising revenue will remain the main source of income for Internet portals, citing a recent report that global portal advertising revenue is expected to grow from 87 million US dollars in 1999 to 1.9 billion in 2004, implying a five year compound annual growth rate of 85 percent.

E-commerce could make up less than 20-30 percent of revenue, Gupta said. The

growth of advertising would still be only enough to support a few portals in the region, compared to the hundreds or thousands currently.

Gupta said Sina.com, Daum, Kimo.com, Lycos Korea, Netease, YahooAsia and YahooKorea are among those with the ability to provide mass customization and targeted content.

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