Despite the major downturn in the dotcom industry, malaysiakini 's operating company Mkini Dotcom survived its first year with a minimal loss of about RM32,000, according to audited accounts released today.

The company earned over RM190,000 in revenues, 95 percent of which was from online advertising. Income from other items totalled RM403,000, which includes a RM375,000 start-up grant from the Bangkok-based Southeast Asian Press Alliance, a regional journalist body.

Income (RM)

Expenditure (RM)

Revenue

190,011

Salaries

341,071

Seapa Grant

375,303

Administrative

120,884

Other Income

27,818

Other operating costs

162,963

Total

593,132

Total

624,918

Profit/(Loss): (31,786)

The audited accounts recorded an operating expenditure for the year totalling RM625,000 with more than half going to salaries. Malaysiakini went live in November 1999 with six staff and closed the end of last year with 18.

"We had anticipated the Internet fallout and adopted a rather conservative expansion plan," said chief executive officer Premesh Chandran.

Chandran said that besides its core business of publishing malaysiakini , Mkini Dotcom has ventured into two related areas - website hosting and technology development.

In the area of website hosting, Mkini formed Myonehost.com in partnership with KOAM (M) Sdn Bhd, a company with expertise in servers and network security.

"Myonehost.com offers complete hosting solutions including design and development, hosting, online payment support and online advertising through malaysiakini and affiliated websites," said Chandran.

"Myonehost will allow malaysiakini to reduce its hosting cost while at the same time diversify revenue streams."

Technology development

Chandran added that Mkini has also set up a technology arm, Kini Technologies, to develop digital media solutions.

"The first project of Kini Technologies is an integrated online advertising engine that will power various forms of online advertising including banners, classified and directory ads, discount coupons and other new online ad formats," he said.

The project is in collaboration with the Centre for Advanced Media, Prague (C@MP). C@MP, which is the technology arm of venture capital Media Development Loan Fund, aims to develop open source technologies for application in Third World countries.

C@MP will be utilising the ad management software developed by Kini Technologies as part of its software application group called C@MPW@RE.

"The software will also help malaysiakini to introduce a variety of online advertising products and be more self-sufficient. Other online media start-ups can also use this application for their own online advertising needs," said Chandran.

According to Chandran, Mkini will double its operations in its second year, with a budget of RM1.13 million.

Income (RM)

Expenditure (RM)

Grants (2 nd year seed grant Seapa)

140,000

Staff & Salaries

835,000

Ad Revenue

430,000

Administrative

150,000

Content Sales

175,000

Marketing & Sales

30,000

Media Fund

330,000

Technology

50,000

Other revenues

50,000

Other expenditure

60,000

Total

1,125,000

Total

1,125,000

"With the assistance of an additional grant of RM140,000 from Seapa, financial support from our readers through the Malaysiakini Independent Media Fund from which we hope to raise RM330,000 and a strong growth in revenue expected to be around RM600,000, we will be breaking even for the year," he said.

He said that revenues are predicted to grow by three times for this year. This will be through a doubling of online advertising revenue to RM430,000 and an aggressive selling of malaysiakini 's editorial content to online and print news media, contributing an estimated RM175,000.

Bullish about the future

Chandran is bullish about the long-term prospects of malaysiakini .

"Over the year, malaysiakini has built its brand name and recognition as a provider of independent news. Our average daily readership reached 100,000 in September last year and we estimate it to hit 250,000 by the end of 2001," he said.

"If we include syndication of malaysiakini news to other websites, e-mail groups and print publications, we believe that malaysiakini has a reach of over 500,000 readers all over the world."

Chandran also expects malaysiakini to grow further with the increase in Internet penetration in Malaysia with the introduction of new delivery systems such as broadband and GPRS (General Package Radio Services).

"The larger audience will pull advertisers from traditional media into new forms of advertising. We also expect the demand for online news to increase dramatically as readers grow accustomed to receiving real-time news," he said.