Friday, October 16. 2009Maybe I'm Losing My Nerve After Almost Six Intense Years...John Linton ...of micro managing a business second by second but I have very real concerns about the immediate future. We had our monthly board meeting yesterday which lasted, as usual, around five or six hours and comprises a review of each aspect of our business with the responsible manager followed by an overall review of our strategies and changes of direction (if there are any). We have been holding monthly board meetings since we began operating as a data service provider and have been holding them in the current format for getting on for two years now. In many ways yesterdays board meeting was a very invigorating affair with most aspects of the business at record levels and a great deal of progress in the operational methodologies we employ together with three exciting new developments. One pleasantly surprising thing (for a company that pays little attention to profit other than to try and ensure we continually make one) was the record profit for the quarter which was higher for the three month period than we had made in the previous six months which, at the time, we were very pleased with. I was surprised because we have gone through some pretty expensive changes to the ways we do a number of things and some of the things we had aimed to do had not worked out as well as we had hoped for.....including the disappointing results in HSPA and the significant decline in new ADSL2 applications - (almost totally offset by the strange increase in ADSL1 applications). Nevertheless revenues and profits for the quarter were at new record highs which is always a good thing when you run a tiny company in viciously competitive market places and allegedly difficult financial times. So why am I feeling less than confident? I can't explain it in credible detail with sufficient analysis to make any sort of sense out of it but some of the more 'real facts' are: 1) I have said for a while that the latest round of annual reports by communications companies (from Telstra down to the dregs) seemed to clearly show that their progress had slowed significantly in the six month period from 1/1/09 to 30/6/09. 2) The ABS survey confirmed this very obvious trend and, if it is to be believed, actually showed a decline in the growth of ADSL for the first time since the technology was introduced. 3) The level of applications we are getting for ADSL2 services that are subsequently rejected due to 'lack of ports' (at least lack of ports for Exetel) continues to increase. 4) There is a noticeable increase in companies advertising 'unbelievable deals' in most media I am aware of. 5) The dial up campaigns by Telstra seem to have resumed with their half price/free/no payments offers that while never turning out to be as true as 'first hearing' would suggest are phrased in ways that seem to be true to the gullible. 6) AAPT's unlimited offer seems to have triggered the copyists with companies like Dodo making such offers now 7) Almost every ISP increasing its downloads if not decreasing prices on almost all of their plans All of these 'facts' are indications of the results of a continuing slow down in new and churn uptake by companies offering ADSL services across the board and as so many companies have made very public forecasts of how much their growth is going to be over the coming months there are going to be, in my opinion, some great difficulties in those companies going anywhere close to the results they are predicting. I could of course be quite wrong and our first quarter's results are certainly pointing in the reverse direction overall - except for ADSL2 take up....and in our particular case our HSPA results are nowhere near what we had planned due to circumstances that only relate to my own stupidity and some actions by our supplier that were very unexpected. I'm not sure what to do about the ADSL services - probably for the first time in six years - but will continue to look at what the future options are and maybe bring forward the anticipated benefits of those future scenarios in to closer term plans and pricing. In terms of HSPA services the situation is even more difficult. Two of the key aspects of what I thought would be the case now have failed to materialise and while neither were 'essential' they would have made a huge difference to us about now. Instead of two major 'pluses' we have an additional two significant 'minuses' which while you can always count on unexpected set backs in business having four 'reverses' in a matter of 6 or so weeks is a little dis-spiriting. Perhaps its time for a radical set of changes to many aspects of our business to deal with the new realities with which it looks like we are being confronted? Nothing seems very clear to me right now which is something I haven't experienced at any time of Exetel's existence. I guess dealing with unexpected negatives is what I get paid for so I better get on with it. Trackbacks
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Nothing that I know of.
I misjudged some aspects of dealing with other Optus resellers and with Optus itself that has made things quite difficult in some unexpected ways. Purely my errors of judgment. Comments (4)
well lets have some updates, its been a big project that you where quiet interested in.
Comments (3)
Pardon me? Am I missing something?
Unless you are a director or shareholder in Exetel you don't get to 'demand' information from me. Comments (4)
just a country boy living in the city wondering what options the old folks have back on the farm.
I'll guess we'll leave them on $120p/m nextG solution they love so much. Sorry to upset your Saturday with my enthusiasm Comments (3)
I've also been listening for any further updates on the "country broadband". It may well suit my parents better than the Exetel ADSL1 plan they're currently on.
Regards, Michael. Comment (1)
Good to see that you have retained that rather infamous level of sensitivity after all these years in the ICT industry
Comment (1)
Long time reader, first time poster.
If you don't think the NBN2 will ever get built (in contrast to the views of most others) perhaps the time has come to back that belief with some expenditure in DSLAMs where ports are non-existent or drying up. Comments (2)
There are already too many bits of rusting metal in Telstra's telephone exchanges.
Exetel adding to that clutter would do nothing to benefit any Australian user. Comments (4)
A question: What proportion of your users find out about Exetel via Whirlpool?
A left-field suggestion of why people may not be making ADSL2+ applications but are making ADSL1 applications - if you are looking for ADSL2 suggestions on whirlpool's broadband choice Exetel does not come up(http://bc.whirlpool.net.au/bc/isp-340-5/exetel-adsl2-phone.htm), but it does come up if you are looking for ADSL1. (http://bc.whirlpool.net.au/bc/isp-340-1/exetel-adsl1-added-value.htm) I know it can't be the whole reason. But maybe it's a significant reason. Comments (2)
I think a bigger reason is that home leases are generally 12 months long, and with Telstra now imposing an extra $100 charge for disconnections within 3 months, people are tending to go with Exetel's 6 month ADSL1 contracts instead.
Comments (2)
I have directed a few more people to Exetel recently...
... none of them were on ADSL2 enabled exchanges. H. Comment (1)
Population in the area I service:
Lake Macquarie - 183,000 City of Newcastle - 141,000 Wyong Shire - 146,000 City of Gosford - 165,000 Total = 635,000 There have never been many ADSL2 exchanges in this area to start with. Exchanges with free ports now: Probably a handful. Go figure John. Kind of depressing if you would like to sell something but you can't. Somewhat like in East Germany sometime ago. Comment (1)
The only solution I can see is to re-sell Telstra ADSL2 services instead of Optus and AAPT.
However the price Telstra would, at least up to now, charge Exetel makes that unattractive to the point of unsaleable so it has never been an option. But, as you say, as Optus and AAPT continue to "run out of ports" there may become no alternative. It is not an easy situation to come to grips with and, personally, I can see no solution. Comments (4)
Your HSPA results are bad because you failed to localise the television ads to the area you are targeting.
As I told you in a previous comment if you have a local personality, landmark or anything "local" in the area you are advertising to people will pay attention to your ad. Eg. Some of the Australias Funniest Home Video promos have Shelley Craft mention the local station name (NBN Television) plus by saying "Newcastle's favorite funny home video's" - It grabs peoples attention. Also McDonalds and Harvey Norman have local content in their ads. If you have a generic ad people will just think "Another Sydney Company" and won't take notice. Speak to an advertising agency in the area you are advertising and ask how you can localise your ads otherwise you are wasting money. Even if it's a local personality some people cringe at... eg. "Super Hubert" in Newcastle... it will draw attention to the ad and people will look at your website. Comment (1)
LOL,
Reminds me of the adverts I see/hear when visiting relatives in Port Macquarie sometimes. Ocassionally you'll hear an advert for "Lake Cathie" when of course every local knows it's said "Lake Cat-eye". It's a matter of well lets not ever use them, they're not local! Having said that though, I saw your Exetel ad live-on-air when I visited them over the long weekend and they said they probably would have been interested in that if they didn't already have Exetel ADSL. T. Comments (2)
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