Yahoo India has decided to shut down SpotM, the social network it launched less than a year ago in India. According to the site, SpotM. which never exited private beta, will be shut down on Sep. 1. Yahoo launched SpotM as a social network for the 16-24 age bracket in an attempt to capture the growing market in India.

It appeared that SpotM had potential to take off due the popularity of social networks in India and the addition of a few differentiating features. Yahoo said that SpotM would allow users to make friends with other users and if they wanted, to make those friends private so other users wouldn’t know about the relationship. SMS integration with anonymous chat would let users correspond via SMS without revealing their phone number.

But it appears that SpotM couldn’t compete with other social networks that are dominating in India. Google’s Orkut is the leader in the space, with 16 million unique visitors in July, according to comScore stats. Facebook, which is growing incredibly fast in India, reached a high of 7.5 million unique visits in India, according to July’s comScore numbers. In May, Facebook launched availability for several Indian languages including Hindi, Punjabi, Bengali, Telugu, Tamil and Malayalam. Perhaps Yahoo is planning to focus its social networking efforts in other parts of the world with the recently launched Yahoo Meme.

Thanks to Ashish Sinha for the tip.