One on One Ivo Lukacovic - trailblazing Internet whiz-kid turned serious businessman

24-02-2004 | Rob Cameron

Rob Cameron's guest in this week's One on One is Ivo Lukacovic, founder and managing director of the Czech Republic's first ever Internet portal - seznam.cz. Eight years ago, aged just 22, Ivo dropped out of college to set up Seznam. Now it's one of the country's best known websites, and Ivo employs 150 people.

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Ivo, welcome to One on One - first question, what exactly is an Internet portal?

"An Internet portal is a gateway for almost everyone to enter the Internet. People find news there, and search the Internet, and they have web pages there, and their email addresses there, so it's almost synonymous with the Internet."

So it's not just a search engine.

"No, it's not just a search engine. We also have a news server, which is number one in the Czech Republic, we have a community server, which is also number one in the Czech Republic, we have the most popular email service. So we have a variety of services here on the Czech Internet."

It was quite a daunting thing to do wasn't it? To leave college at the age of 22 to set up a company which has grown into this huge operation we see around us.

"Yes, it seemed like a stupid idea at the time. But most of the people who stayed at college are now working for me. So I think at the end of the day it was a good idea."

So you don't have any regrets not finishing college and going into business.

"No. I think one year as a businessman gives you much more experience than five years at college. It's the difference between practical life and theory."

What was it like starting out? If I look around us now, we're in a very modern office in an old factory building, and there are several hundred employees working away. It looks like a very impressive operation. Presumably it wasn't like that at the beginning.

"I started as a one-man show. I was the programmer, and the sales manager, and the director, and the graphic designer, and I did the content myself. So it was hard to do. I had to work late nights. But then I hired my first employee, a sales manager. So the first employee started earning money, and after that I could hire a second, and a third, and a fourth and so on, and the business started to grow."

Was it a difficult beginning? Were there any major hurdles?

Ivo LukacovicIvo Lukacovic "The major obstacle was that we still didn't have any money. The market was small, and my parents had to help me. There were no venture capitalists at that time. The banks didn't want to give you a loan. So that was the major obstacle. But on the other hand, there were major advantages. There was almost no competition, and the expenses were running such a service were low, because the computers were very cheap. So there were also big advantages."

I think many people don't really understand how Internet companies make money, when the Internet is basically free apart from the dial-up costs.

"Five or six years ago, everyone thought the major business for an Internet portal was selling Internet banners or Internet advertisements. So people would look at an ad, and then click on it, and buy something. But it seemed to be the Internet business's biggest mistake. The biggest profit comes from selling preferred links. If someone goes to Seznam and searches for 'swimming pools', so we list someone in the first place, and this company will pay us enormous amounts of money to be first, because that way they can sell two-three times more pools. So we started selling these priority links, and now this accounts for 70 percent of our revenue."

Internet use has traditionally been quite low in the Czech Republic. Why is that?

"I don't call it a few people. Right now I think Internet penetration is around 30 - 40 percent, nobody knows exactly how much it is. We have the highest penetration of all these post-Communist countries, but a major obstacle is the telecommunication fee."

Basically the cost of going online is just too high for most Czechs.

"Yes. For a Czech person, getting connected to the Internet is much more expensive for someone from Germany or the UK. But most Czechs - not just Internet users - are technical geeks. They like technical inventions, and they like everything connected to technical things. So they're capable of spending even their last money to be connected to the Internet."

Obviously one area of concern is the spread of unpleasant websites catering for paedophiles and neo-Nazis etc. What can Seznam do to stop this?

"If we find out that a link on Seznam points to such a site, we will delete it. If a user uses our web email for such activities, we will stop it and we co-operate with the police. People talk a lot about such activities, but they are less than one percent of Internet activity."

Are you legally responsible for that content?

Ivo LukacovicIvo Lukacovic "No. There's no such law. And right now they'll be a new law saying there's no responsibility on our side. The responsibility rests with the person who puts the content there."

Should the Internet be censored, should it be policed?

"I don't think so. The Internet is one big democracy, and I'd like it to remain that way."

So you think it should remain as open as possible.

"Yes. I think it should remain as open as possible. But I think it should be more developed in a technical way. For example spam. Everybody hates spam, and spam is a big problem. The problem with spam is not with the legal side, the problem is that the protocol that delivers the mail is 30 years ago. Thirty years ago, some university invented this protocol, and right now this protocol is so easy and so open that there is the spam problem. So if there was more technical development in this way, there wouldn't be any spam."

The Internet has been widely used for just a decade or so. We're very much at the beginning of its life so to speak. What will the internet be like in another ten years, or even 50 years?

"I think there will be more users, and more applications, and of course they'll be broadband. You'll come home from work and log on to the Internet instead of turning on the TV. Because on the Internet there will be much more choice of channels, and I think the Internet will very slowly replace the TV."

And do you hope to be actively involved in the process of developing the Internet in 10, 20, 30 years?

"In 20-30 years? I'd like to be in this company, in this position, forever! I like it."

www.seznam.cz

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