John Linton's Personal Musings

I had 'breakfast' with a long term business acquaintance this morning (which basically meant we both had a cup of pretty ordinary coffee and he compounded his mistake by attempting to eat an 'omelet' and some exceptionally dry toast). At least the view was very pleasant. He was 'visiting' Sydney as he works in Hong Kong and his trip was largely based on looking for 'partners' in his SMS and associated business services. We first met back in our IBM days and have occasionally run in to each other in strange parts of the world every few years ever since we both left IBM to pursue opportunities elsewhere. 

Like Exetel, he is very interested in SMS over HSPA/VoIP/Mobile handsets and the implementation he showed me on his 'globally roamed' iPhone was a very sophisticated implementation which is considerably in advance of Exetel's current version and was an 'eye opener' for me to see what amazing things could be done with the computing power and memory of today's advanced mobile hand sets. It was a very impressive demonstration and, if I hadn't already been 'sold' on the concept I just about would have bought on the spot  - it had so much 'pizzazz' and 'must have that' appeal.

I'm sure he will be successful in selling his software to at least one of the Australian mobile companies as it was such a beautifully designed and presented product with so much eye appeal as well as being a major cost saving to the end user - and there lies the problem as he went on to explain. He had been in Sydney for almost two weeks and had generated no interest from the people he had met with so far at the four Australian mobile carriers. Now, we are talking about a very skilled sales person with a great deal of business acumen and a very senior position with a very large Chinese communications company - not some local 'account manager' or 'product manager'. In my eyes the SMS product he showed me was as good as I could imagine any product could be in every aspect of ease of use, presentation, functionality and cost saving and integrated with every commonly used 'name list' and third party program.

The problem, as he explained it, was that the mobile carrier personnel he had approached in Australia (and before that New Zealand) simply weren't interested in it because instead of seeing how it would generate additional net revenue and boost the sale of HSPA services they couldn't get past the likelihood that it would reduce SMS revenue - which I suppose it might if you wanted to look at it as an SMS replacement function rather than as an SMS enhancement of several magnitudes. I couldn't provide any sensible information in terms of who he should approach within the carriers (or their major resellers) as I have no dealings at any senior level with any of them and as Exetel are so small we couldn't even 'trial sell' his product as we are far too early in coming to grips with what is required to build any sort of 'presence' in the Australian HSPA market places.

As I drove back to the office I was encouraged that it was possible to develop such an appealing product and I have renewed hope for the ongoing development of the SMS via VOIP service that we brought to market a little over 12 months ago which has since been very enthusiasticly taken up by Exetel ADSL users and we are now working on the HSPA version with the first 'iteration' already in use and working quite well. To get from where we are today to what I saw an hour or so ago is quite a distance but, at the end of the day, "its only a few lines of code". Where we find the innate skills and the capabilities to write those few lines is another issue altogether. However - we have always managed to do it. We must increase the resources allocated to these developments and pull back the end dates for their deployment. Lucky we have such brilliant and skillful programmers.

It seems to me, and I would be the first person to admit that my knowledge of the mobile telephone market is extremely 'slight' (and that's being kind), that software developments like fring and nimbuzz and, on a much grander scale, the SMS over HSPA I saw today represent significant opportunities for businesses to not only reduce the ever growing costs of providing mobile services to operate their businesses but are capable of truly adding new functionality - almost in the same way that the introduction of mobile telephony added extraordinary new capabilities by being able to make and receive calls anywhere rather than only at the end of a piece of cable attached to a PABX.

I've been using fring exclusively since I returned from Sri Lanka to make and receive mobile calls over Exetel's VoIP service and, as when we switched the office wire line services from ISDN to VoIP, almost no-one I call, or who calls me, can tell any difference. The delay using fring varies from virtually none to 'noticeable' and we must implement local servers to eliminate that aspect of VoIP over HSPA but there are many solutions and it's only a matter of deciding on how we do that. I will start using version two of our SMS over HSPA function some time next week which will be more of a challenge for me as I've never had a need to use SMS in the past so have only ever received SMS from all those annoying sources that just require me to delete them rather than reply to them.

I've never regretted moving Exetel's telephony from ISDN to VoIP, and not just for the obvious call savings - the added functionality that VoIP allowed us to enhance our business by hundreds of thousands of dollars over the past three years by allowing us to do things that simply weren't possible at any realistic cost over 'conventional' wire line services. We certainly wouldn't have been able to automate so much of our support and update services nor would we have been able to operate as we do now in Sri Lanka without the functionality of a VoIP 'PABX' and the ability to 'bolt on' Asterisk functionality.

At this early stage I expect that HSPA VoIP and SMS will produce similar opportunities for us - if we are skillful enough to program them and then competent enough to make a dent in the corporate attitudes to 'new' functionality that my old friend is having so much trouble with.

....something important - probably.

Exetel made the BRW's list of the 100 fastest growing (private or public) companies in the financial year ending June 30th 2008. To appear in the list a business needed to have achieved an average annual turnover growth in the three years to June 30th 2008 of 44.43% with a staff of less than 200 people.Exetel ranked 83rd in the BRW Fast 100 list (published in the October 30th 2008 edition of BRW) with an average annual growth over the past three financial years of 50% per year. Revenues used were ex GST.

As with the inclusion in the Deloittes Fastest 50 list last year we are pleased with the 'recognition' and we get a degree of (self) satisfaction from outperforming, in some respects, the majority of other small companies in Australia (public or private) - at least as judged by the criteria set by BRW. There is no doubt that the 'recognition' helps in growing our corporate business and it also seems to please our residential customers judged by the large number of communications we received last year after the Deloittes list was published. We will record this event as a news item in our 'History Of Exetel' which we have assiduously kept up to date since the first month of our existence:

http://www.exetel.com.au/news_main.php

(lucky I saved the second October 'spot')

and we will replace the Deloittes logo on the front page of our web site.

Then we will move on.

In the BRW article there is a table listing the the issues stated by the 100 companies (or those that responded to the detailed questionaire sent to the included companies earlier this month) as being the most important for the remainder of 2008 and for 2009. The issues in 2008 and 2009 were stated as being:

2008: Hiring quality staff, Growth strategies, Managing staff, Slowing economic conditions and Margin pressures

2009: Hiring quality staff, Slowing economic conditions, Capital for growth, Managing staff

I remember filling out the questionnaire and I rated four of these 'top  concerns' as of zero concern to Exetel with only the access to capital as being a real issue for our future plans. My views on the 'top four' concerns are the reverse of what is alluded to in the questionnaire as my views are these:

Hiring Quality Staff: It seems to be a consensus that hiring 'quality' staff is the major issue to be addressed in the 100 companies surveyed - but that would almost always be the major issue for any commercial enterprise as a commercial enterprise is only the sum of the qualities and capabilities of the people within it. I always find it strange that this, the most obvious requirement of any business, is even mentioned in terms of what are the major concerns of running a business. Without being stupid about this point -  saying that your top concern/issue/problem is hiring good personnel seems to mean you have misunderstood what starting and/or running a business is all about. You actually don't start a business if you believe acquiring good personnel is going to be an issue.

Managing Staff: Similarly, stating that "managing staff" is a key major issue seems unbelievably strange to me. All of human existence is based on social interaction and from the time a human being takes their first wavering steps all of their subsequent life is interactions between themselves, hard objects and other human beings of various compatibilities. There is nothing 'special' about "managing personnel" and indeed it's very difficult to use those two words as a phrase without getting the feeling that something is very wrong with what you are trying to say/describe. I doubt that anyone that has been appointed as, or simply become, a "manager" of people wouldn't have failed to grasp with a day or so of being given/assuming a 'management' title that doing what the title suggests is simply not possible. Again, you don't start a business, or involve yourself in a business, if you believe that "managing people" is ever going to be an issue.

Growing The Business: I suppose the only way that any company could have been included in the BRW Fast 100 listing is because, for the past three years they had managed to understand how to grow their businesses by at least an average of 44% over the last three successive years - which isn't an easy thing to do 'organically' and as successive years pass it obviously becomes harder to do as the early years of any business see the highest rates of growth (basically because, of course, any growth from zero is going to be the fastest period of growth in any company's 'life'. If a business has got a sustained (organic) growth record then growing it further shouldn't be an issue - whether it grows as fast or faster in percentage terms isn't going to be as easy, generally, but the growth in revenue/profit terms isn't going to be the hardest task of any planning period - at least not in my experience.

Slowing Economic Conditions: One of business life's great levelers - and I'm not being a smart arse in saying this, is that in any aspect of personal or business life its obviously easier to perform well in easy times. It doesn't mean it's inherently harder to perform well in tougher or very tough times if your performance in good times was based on really sensible operational methods and really sensible and financially prudent funding principles. The reality is that well managed companies perform even better in tough times than in easy times because they are more efficient, carry less risk/debt and are therefore more soundly based than those that have ridden the 'forgiveness' that easy financial times and high growth rates allow. Unless a business has borrowed unwisely or is dependent on the high spending of its customers/prospective customers (real estate, stock broking etc) tougher economic times are more opportunity than barrier to growth - generally speaking.

Assuming the responses to the questionnaire were truthful then I can see little relationship between Exetel and other companies that grow quickly in their first ten or so years of existence. That doesn't mean that Exetel is better or worse in terms of the way it's operated - it just means it's different and also that the questionnaire wasn't as well framed as it might have been. I suppose it also means that for any small company to be more successful than  other small companies then, by definition, it has to be different in as many ways as possible to the companies with which it competes.

While this is not particular easy for a company that competes with much larger companies and has to use much of the same 'base components' to construct its products and services as are available to its much larger competitors there is always going to be a Singapore Airlines that manages to use the same components as its competitors but do so much better with them.

I would like to believe that Exetel can emulate the success of SIA over time. In the meantime its nice to be included in the BRW's Fast 100 companies for 2008.

While I have so little knowledge of the financial and economic outlook for the world generally and Australia particularly I have been quite happy to believe that statements from various sources relating to Australia's relative 'immunity' from any major impact have some semblance of credibility. Not the ones that aver that there will be little/no impact on anything (a la krudd and whine) but the more measured RBA and conservative economic agencies that say "negligible growth, lower exports and lower dollar". So I read this yesterday with a touch of bewilderment:

http://www.misaustralia.com/viewer.aspx?EDP://1225143418953

Steve met with representatives of Pipe last week to discuss what they may be able to offer in terms of IP services when they turn on their new cable service which, at that meeting, they said would be around mid 2009. Knowing very little about the laying of under ocean cable, but assuming a mid 2009 availability date would mean that it was well under way (and I thought I had read some time ago about how it was already in testing with some "foundation customers") and therefore I don't know what to make of the statements by Pipe's CEO that the financing of the project is not yet in place and that, because of the 'global financial crisis' (that was not going to have much affect on Australia) there may be some delays and there may be a need for 'restructuring the ownership of the new service':

"Obviously we are hoping to proceed as planned....or quite simply we won't be able to meet our own stated criteria".

I'm assuming he was both quoted correctly and chose his words carefully. If that was the case then, it seems to me, that there are some very real doubts about just what the situation is with this new service. The fact that Pipe has chosen to comment on what appear to be some serious doubts about the project's viability is even stranger than the comments themselves. I would have thought that if there was just some minor delay, contract tidying to be done, then no comment at all would be either necessary or wise at this very late stage of development. All it can do is to call into question how such a large project can be entered into, let alone accepted by the cable laying ship's owners and other contractors without locked down finance in place (which these comments seem to call into question) doesn't make any sense.

Another article which, in many ways, makes even less sense was this one reporting that iinet had decided to use Telstra's ADSL2 services and retain Telstra's ADSL1 services for its Westnet customers:

http://www.australianit.news.com.au/story/0,24897,24564954-15306,00.html

Despite the attempt at explanation by the iinet CEO in the article - this makes absolutely no sense at all. Iinet, along with every other ADSL2 DLSAM deployer has gone out of their way to justify these investments by stating, over and over again, how it gives them a huge financial advantage over using Telstra Wholesale's services and yet, in a 'blink of an eye' iinet are now saying that rationale isn't true because "Telstra Wholesale have improved their 'deal/pricing' to such an extent that it's no longer necessary to invest in their own ADSL2/ADSL1 DSLAMs"????? That must have gone down really well with the iinet board who have agreed to such a major set of investments to "free themselves from Telstra's restrictive pricing" and make a massive contribution to the bottom line'.

I, obviously, would have no idea what iinet would be charged for ADSL2 services by Telstra Wholesale. The only company re-selling Telstra's ADSL2 services who has published prices is, as far as I know, PeopleTelecom whose prices can be found here:

http://www.peopletelecom.com.au/internet_plans.php?PlanType=1&ProductType=1

These published prices are sky high when compared to ALL other ISP's ADSL2 plans (including iinet's) which would have to indicate that the price PeopleTelecom have negotiated for a Telstra Wholesale ADSL2 service is far higher than other ISPs ADLS2 networks cost them or far more than Optus Wholesale charge their ISP wholesale customers. If you compare the 10 gb download ADSL2 plan at $85 per month and the 10 gb download 8192/384 ADSL1 plan (also sourced from Telstra Wholesale) at $80.00 per month you could conclude that either:

a) PeopleTelecom were buying an ADSL2 service at $5.00 more than an 8192/384 service from TW

or

b) PeopleTelecom were buying at an unknown cost but had decided people would pay more for a possibly faster service and they could justify, somehow, a far higher ADSL2 price than anyone else offers in the market (including Telstra Retail).

If you think about it for more than a few seconds you will almost certainly conclude that a) is the more likely scenario.

Now, undoubtedly iinet has many more customers than PeopleTelecom and would therefore have more 'negotiating power'. So undoubtedly they would buy at a better rate than PeopleTelecom. It would have to be at a much, much better rate than the rate implied by the PT published pricing........and, when you think about it......that is not so easy to believe.

So the most likely conclusion you could come to is that the cold winds of debt servicing and financing in a "global financial crisis" which includes a 'plunging' Australian dollar has somehow made iinet think that buying from Telstra (after all the harsh words its published about TW's pricing and how it was holding iinet back from its ambitions) is in fact better value than providing ADSL2 services via upgrading its own DSLAMs.

Then again, irrespective of the quasi logic I've used above - that surely can't be the case can it?

If the last sentence in that article becomes a reality then it will seem to mean that investing in ADSL2 DSLAM networks was a very, very bad idea. But then I always predicted what Telstra would do and the time frame they would do it in to make that assertion true.

So, perhaps the cold financial winds may already be blowing and they are having some affects on the Australian communications industry.

Perhaps, for once, enduring all the pain of 'ploughing a lonely furrow' will pay off?

Exetel had a very good order day yesterday - the best for three months or so. There was one extremely strange characteristic about it. For the first time ADSL1 churns from other ISPs equaled ADSL1 new applications. Since Exetel first started in business our percentage of ADSL1 churns to new applications has fluctuated between 15% and 25% on any given day with an occasional 'blip' that was statistically irrelevant. Now that I look back over the almost four months of the current year I can see that the daily ADSL churn percentage has slowly, but continuously, been increasing each week for the past 16 weeks. However yesterday demonstrated the magnitude of this change in 'source of business'.

Its possible, as a spokesperson for Internode was quoted as saying some months ago, that the ADSL1 market has reached a point of 'slow down' in terms of new ADSL users though that hasn't been evident from our sign up figures until very recently in terms of the increase of churn percentage of ADSL1 applications. For this sort of percentage change to occur in such a short time frame you would normally look for another explanation than that. Which brings you to the inevitable conclusion (seeing that Exetel hasn't made any changes to its pricing for some time other than to de facto increase some current user's prices by withdrawing older plans) that the 'dramatic' increase in churns from other ISPs is being caused by other factors.

Not just a 'slow down' because the actual number of new ADSL1 applications hasn't decreased in absolute terms and ADSL2 numbers have continued to increase.

There is no change in pattern, as far as I can see, in terms of which ISPs churn customers are leaving to come to Exetel except for the slight increase in the 'other' category of round 10%.

The churn statistics over the past six completed months show no 'ranking' change - only a general increase in gross numbers of churns. 

1 - Other Small ISPs - 1,278

2 - Telstra - 710

3 - TPG - 191

4 - Optus - 190

5 - AAPT - 174

6 - EFTEL - 142

7 - WESTNET - 99

8 - INTERNODE - 91

9 - NETSPACE - 95

10 - IINET - 56

The increase in churns from very small ISPs is to be expected given the number of inquiries we receive from small ISPs looking to sell their businesses. The increase in churns from ISPs from whom the bulk of our churns come from must indicate something else - possibly the first indications that people want to keep their ADSL service but need to find a service at a lower monthly cost. Maybe it doesn't mean that, but I'm not able to think of any other reason for this sudden increase. We'll have to wait and see whether its an anomaly or actually the start of a real trend and if it is the start of a real trend - what is causing it and how long will it last?

Our overall order levels are up significantly over the same period last year (around 50%) so it isn't a case of just a change in sources of business. The actual gross numbers of churns are up very significantly and have increased as a percentage as the new ADSL1 applications has also increased. For the number of churns to have increased so much and so suddenly from a four plus year 'history' of quite a tight 'spread' there must be some underlying change in what is happening in at least some parts of the marketplace. This change is even more apparent that the start of the Telstra Retail marketing programs to 'win back' Exetel ADSL1 customers in mid 2007 so there must be a reason - I don't believe that such marked changes occur for no reason.

Another indication that times may be getting tougher that I've noticed in the past few days is the increase in requests Exetel/I receive to participate in various 'industry' meetings either under the aegis of some State or Federal government 'department' or some sort of 'industry association'. In the time I was away I received 8 such invitations and yesterday I received four more. In the past five years I would not get more than one such 'invitation' every 4 - 6 months. If it keeps up at such a rate I would be able to spend more than half of each week traveling to and attending 'discussions' and 'presentations' on matters of vital interest to Exetel. I don't know whether this is a pre-cursor to the 'silly season' (which I think will be whole lot less 'silly' this year) or an indication that the herd is feeling the need to shuffle together in the face of unseen dangers and/or the bitter cold winds of winter/recession.

I have declined all of these 'invitations' to date and am likely to continue to do so. I have never learned very much if anything from 'industry' conferences and I have never learned a thing from any discussion initiated by any government authority. Life is too short to waste any 'spare' time on such 'events'.

So - two indications that something is 'happening' in ISP-land - "happenstance and coincidence" - if there's a third then, like Goldfinger, we may have to take the view that all are indications of "enemy action" and make some unplanned changes.

It's good to be back in Australia even though I really enjoyed my week in Sri Lanka. It's always good to have a break, even a business dominated break, away from the proximity of daily business life and it does provide new perspective(s) on occasions as it did this time. I am more convinced than before I went to Sri Lanka that Exetel needs to adopt a very conservative approach to almost all aspects of business in Australia over the remainder of calendar 2008 and we should take the opportunity of 'tidying' up some of the loose ends before commencing 2009.

We will need some time to consolidate the good start we have made in Colombo and we will move more functionality to Sri Lanka rather than expanding personnel in Australia as a matter of policy both to reduce our overall operating costs and to take advantage of those cost reductions to speed the development of new processes and systems and to complete the move to 24 x 7 x 365 operation. I may be being over optimistic in thinking this can be done faster than originally planned but the financial conditions I expect to see in Australia is adding impetus to that schedule.

We will phase out the Unwired service by June 30th 2009 by offering our remaining Unwired users the opportunity for an attractive move to a revised HSPA offerings early in the new calendar year for those who haven't taken up the current offer or the offers about to be made between now and Christmas. I'm disappointed that, for whatever reasons, Unwired never seemed to deliver on its early promise of being a true broadband competitor but we have passed our fourth 'anniversary' of being an Unwired wholesale customer and it's clearly long past time when there is any reason to believe that Unwired has any incentive to try and make a wholesale model work - so time to go.

Similarly we will do our best to persuade our customers on the AAPT/Powertel ADSL2 service to move to the Optus ADS2 service (where it's available) via the painless HSPA interim service 'churn' process. This eliminates some infrastructure as well as finally resolving the problems of unworkably long and untidy fault resolution by AAPT. I think I'm even more disappointed with this 'turn of events' as our business and working relationships with Powertel were always very strong and, at least I thought, mutually beneficial. All that ended abruptly when AAPT took over Powertel and the subsequent problems we had in provisioning (often weeks and sometimes months of difficulties) and then fault resolution (effectively a completely manual system on their end and people who couldn't/wouldn't make it work). So, sadly - time to move on.

Resolving the ongoing difficulties we have experienced dealing with Telstra Wholesale will take more time than we can really afford and we have not yet developed a clear 'path' down which we can go to resolve all of the problems that make most days so unpleasant and wasteful in providing ADSL1 services. There is one way of solving all of the current problems with Telstra quickly and cleanly which we have discussed a few times recently and it has many merits. It is favoured by at least one Exetel director and not opposed in principle by the other two. We will give it more consideration and make a decision before the end of 2008. As with Unwired and Powertel times (and in Telstra's case - top management) change and what was workable in the past becomes unworkable over time and - again - you just have to move on.

In the mean time we need to try and minimize the impact of the various aspects of the 'global financial crisis' on our day to day business plans between now and mid December and we need to get the HSPA service firmly 'launched' in the run up to what is promising to be not such a happy Christmas in Australia this year. In terms of being the lowest priced provider in the marketplaces in which we operate we have the 'inbuilt protection' of being a refuge from higher priced ISPs. However I think if the largest ISPs see their numbers dwindle they will be very aggressive in their 'marketing programs' and I'm hoping the net result of refuge/target will be neutral. I keep looking for signs within our own business of a 'softening' in demand but up to now there have been none. We had a very strong first quarter and October is, if anything, even stronger in terms of applications for each one of the service types that Exetel provides. However, things can change very quickly and I am not counting on the first four months of this financial year as any sort of indication that Exetel will be untroubled by the current and likely future finacial circumstances in Australia.

I received two 'interesting offers' over the weekend and earlier this morning which seemed to underline that life in the communications business may be even tougher than I think it is for Exetel. In essence both approaches were not to 'sell' the two respective businesses to Exetel but to provide their user bases on a '12 month license' whereby Exetel took over the supply of services to their customers (at our supposed lower costs) on the basis of providing a monthly 'profit share' each month for 12 months and subsequent lower 'profit share' from the 13th month onwards for as long as the customer stayed with Exetel. Interesting approach - but no thanks.

So - time to begin the actions that take us to the end of the year.

.....and monopolies can't ever act in any way other than as monopolies.

I finished reading the Australian week end papers earlier this morning and have also 'digested' the various on line media reports concerning the communications industry and the subjects that may be related to it not getting to bed until around 3 am courtesy of the time displacement between Sydney and Colombo and then slept like the dead for 7 hours. It's nice to be home, as always, and it's a beautiful Sydney Spring day.

My view on the NBN hasn't really changed and I still see it as a total irrelevance in any of the forms it might eventually be built if in fact that ever happens. After ten years or so of a travesty of 'competition' it can only be concluded that the 'privatisation' of Telecom Australia to create Telstra has been the single most grotesque 'policy' failures in the history of the Commonwealth of Australia and the most ludicrously inept attempt to bring about a competitive telecommunications environment in any country anywhere in the world.

The 'privatisation' of Telstra has been such a total failure, in every conceivable respect, there really are only two choices left for the current government:

1) Use their demonstrated ineptitude and complete lack of understanding of any slight aspect of the Australian communications marketplace and Telstra's current situation to continue by giving them more money via the 'NBN tender' to complete a formal re-monopolisation of the wireline services in Australia over the coming years.

2) Cancel the 'NBN tender' process and let Telstra build out its current network in any way it deems to be sensible and complete its re-monopolisation of Australia's wire line services in that 'non-interventionist' way and save the immediate wasted expenditure of tax revenue while accepting that Telstra will simply charge more for wireline and related services to cover it.

All that the 'privatisation' of Telstra has done is to pay tens of millions of dollars to failed American 'managers' instead of several million dollars to failed Australian managers to run a bloated and massively inefficient dinosaur with some of the most mediocre 'management' at every level ever seen in an alleged commercial company and to increase the number of inhouse lawyers and outside lawyer payments ten fold as the newly privatised Telstra used litigation and other legal challenges to fight tooth and nail to ensure the Australian Telecomunications Act never achieved any of its objectives. No further attempts at 'regulating' Telstra should be made by this, or any subsequent government.

Telstra is and will always be a monopoly (it can't be anything else by definition) managed only in its own interests and for its own interests. It can now use the rationale of 'share holder' interests to bolster its innate monopoly interests so FCS let it get on with its monopolistic practices minus the needs for immense added legal expenses and the slowing down of whatever minor technology it might invest in by bogus 'tenders' that only result in further slow downs.

Monopolies, by definition, are massively inefficient and attract only low level calibre personnel and their only inherent 'culture' is that of maintaining the status quo to protect themselves against the consequences of their mediocrity. Their only basis of "service" pricing is to simply add margins to their inefficient costs to continue to ensure they can continue to pay their own salaries and guarantee themselves jobs for life without ever having to exert themselves or do anything that impinges on the working time they need to indulge their hobbies and the operation of their personal 'outside' businesses during their monopoly paid working hours.

This isn't necessarily a bad thing - it keeps these poorly skilled and abled people off formal welfare and creates an informal 'sheltered industry' environment for the people who work for monopolies - they are unemployable in normal commerce where they would have to perform against deadlines and deliver value for money. If there were no monopolies to employ such people then the Department Of Social Services would need an increase in budget equivalent to the number of people employed by monopolies. So it can be seen that Australians, in operating Telstra, are just paying taxes in a slightly different way and are, arguably, removing potential threats to society from the streets by giving them the illusions of a boost in self image by holding a 'paid job'.

Sure the cost of the services provided by monopolies are going to be higher and the quality worse than those provided by free enterprise but let's face it - it really doesn't matter a damn in this country. Australia already pays for the most wasteful and inept and astronomically expensive method of 'government' in the 'free world'  (Federal/State/Local) with the most venal, if not outright criminal people involved at every level of it and we, as Australians, are quite happy with this massive cost to each one of us as we have voted to keep it since it was imposed on us by a departing colonial administrator in the nineteenth century.

We spend gigantic sums of money on our military (at highly inflated prices - much higher than the same equipment is sold to other buyers) which is usually obsolete before we receive it or we insist on paying huge royalties to the overseas designers so we can build it ourselves taking three times longer than it would otherwise take and then not function properly - or sometimes at all.

And so it goes on and on - every aspect of government in Australia is hugely wasteful, inept, venal and atrociously inefficient.... and we, the Australian voters have only ourselves to blame if we don't like any aspect of it.

There is enough competition in communications via the granting of mobile spectrum licenses which actually did break Telstra's monopoly and actually did reduce mobile prices and increase services to end users - eventually. There's every chance that LTE and other mobile initiatives will, sooner rather than later, remove the need for anyone who wishes to only use mobile voice and data services to stop paying the sky high prices that Telstra has always imposed on Australian users.

So let Telstra continue its monopoly and by doing that hopefully they will be able to fire their thousands of lawyers they currently need to keep communications competition as a dim aspiration of government doctrine and, who knows, maybe reduce their other hugely wasteful marketing and pricing practices designed to cripple any semblance of nascent competition to their monopolies and, in this way, actually reduce, ever so slightly certainly, their prices that are so much higher than every other country I have ever visited.

Telstra will become non-existent much sooner by allowing it to raise prices to a point where people will simply not use their services. Giving it another 10 billion of tax payer money to prolong its existence is not a good idea.

The financial news around the world seems uniformly bad with the exception of Russia perhaps ; where it is even worse. It showed up how disadvantaged Australia is becoming when we checked out of the hotel and, partly because of Sri Lanka’s high inflation but mainly because of the plunging international exchange rate of the Australian dollar, our per night stay cost us almost twice what it did four months ago – as did the taxi fare to the airport.

We are going to need more equipment for the planned Tasmanian PoP as well as to complete the ‘redundancy’ and onsite back up plans for the other mainland State PoPs and all of this expense, assuming we can now afford it, is going to cost more than 40% more than we had planned at the start of this financial year. I imagine that this scenario is going to be the same for everyone else in commercial life in Australia and almost certainly true for our suppliers – fortunately the majority of our IP bandwidth contracts are denominated in Australian dollars – not US dollars or we would have major problems.

It will be interesting to see what happens to communications service pricing over the time between now and Christmas. The rapid fall of the Australian dollar to date and the dire predictions of it continuing to fall to, perhaps, below 50 US cents before it recovers makes our investments in Sri Lanka more expensive,. Although, fortunately, the majority of the main costs have already been paid there are the ongoing costs of the premises rent and the personnel salaries – so the operating cost reduction exercise aspect of the Sri Lankan company set up will not deliver the planned level of reductions in the coming months – although they will still be substantial. So the falling value of the Australian dollar will affect us in this second way; as well as paying more in Australia for hardware and services dependent on hardware and US dollar denominated contracts.

I doubt that Exetel will be any more badly affected than any of the companies with which we compete and perhaps we may be a little less affected than some. It’s becoming a little more obvious that the communications marketplaces generally will be affected as the ongoing financial conditions become not only tighter but more obviously tighter to more and more people. While very large companies have the capacities to take advantage of these sorts of conditions almost all ISPs will not.

And then there's.........the NBN tender ongoing saga.

I don’t know whether TPG/SPT pulled out of the Terria bid simply because they finally see what most people saw a long time ago (that only Telstra could win that ‘tender’) or their current share price obliteration made it impossible for them to pony up their share of finance needed to fund the project in the unlikely event of Terria being awarded the contract. AAPT certainly would not have had the ability to contribute to funding so that means Optus, or rather SingTel would effectively fund the whole project with the 7 dwarfs along for the initial ride to project some sort of ‘solidarity’? Though maybe that word has as much relevance today as it does to Gdansk ship yards. Similarly the remaining five dwarfs wouldn’t have the ability to fund much more than their bus fares to Canberra at the moment and would be more likely to be looking at ways of refinancing what they’ve already committed to – or maybe that’s just me being unnecessarily harsh again – it doesn’t really matter – none of the dwarfs or Snow White are going to be faced with that major problem – and almost certainly never were.

So, back to the future – a Telstra monopoly on wire line communications across the continent after a few years of pretend ‘competition’. It would be laughable if it wasn’t so sad. I suppose krudd and stupid Stephen (actually is SS still minister for communications? – I don’t seen to have heard a word from him in the media for a very long time and my prediction was he was going to be given the old heave-ho by the end of this calendar year – which I made many months ago so it’s not another ‘fair weather’ claim.

I suppose the real question is going to turn out to be – “does anyone have the money to build a national broadband network”?

Or even – “does anyone actually want a national broadband network that runs at 12 mbps and won’t be completed until Australia wins back the Rugby World Cup”?

I’m writing this in Singapore on the way back to Sydney and SingTel seems to have its hands full in its own home base with a lot of money committed to various projects, almost all 3G in the very fast developing markets around South East Asia and according to the local news media they, and the people they are competing with are slowing down and even cancelling some relatively low priced and quick pay back projects due to the unavailability of financing at any price – let alone the terms the projects were originally tendered on.

Anyway – it’s not something that concerns me or Exetel as whatever happens is years away in the event it ever happens and what is very certain is that it will be a very different looking set of marketplaces and technologies by then.

....But really glad to have come back again.

We completed the last of the ‘tasks’ we set out to accomplish in Sri Lanka by midday yesterday which was a sensible amount of time to have allowed. I feel happier about our ‘legalities’ now and while the new accountants may well prove to be as disappointing as their predecessors at least I feel more confident that they understand what we want them to do and they are competent to do it.

I am more than happy with the new Sri Lankan employees competencies and skills and I was impressed with just how much they knew given the relatively short times they have been with us. I was also very happy with their spoken English language skills which are equal to or better than those people we employ in Australia who are not Australian born and educated. We have a very long way to go to make the Sri Lankan company deliver everything we could ever hope it could do but there has been nothing I’ve seen on this trip that would suggest that we couldn’t actually make that happen over a reasonable space of time.

I’m glad we took the ‘gamble’ of leasing far more space than we needed and then fitted all of it out as if we would have 50 people working for us ‘tomorrow’ as I can see now that we may well end up with something like that number of personnel in Sri Lanka in the not far distant future. Of course, all these optimistic views need an unbelievable amount of hard and innovative future work (and quite probably more than a little good luck) to make them a reality but, in many ways, we have begun those tasks already in the best possible way – and in these early stages – with the best possible results.

So the ‘warm glow’ continues for a little while longer.

Later this morning we will begin the messy, in terms of timing and connections, flight back to Australia with the gloomy predictions of the $A falling from approaching parity only two months ago to around 50 cents to the $US within a few months and the ASX following the Dow , Nikkei and the FTSE etc ever downwards. So much for my hope that the ASX had ‘bottomed’ and I could safely re-invest our superannuation in at least the four major banks now their ridiculously high prices had been reduced to something approaching reality.

In scanning the ‘industry media’ I see that iBurst has finally ‘turned up its toes’ adding to the ongoing ‘ranks’ of failed attempts to provide wireless broadband services in Australia – goodness knows how many of them have now failed inconveniencing their customers and taking hundreds of millions (or has it exceeded a billion by now?) of Federal funding with them down the plug hole. Personally, I can’t see how any wifi/wimax solution is going to compete with the major mobile carriers in the future, however it appears that Channel 7 will pour more hundreds of millions into the remains of Unwired so there are obviously other very different views to mine.

I see the index of listed communications companies continued to move South over the week with iinet now re-approaching the $A1.00 ‘floor’ through which it fell so steeply only 18 months or so ago requiring the re-capitalization of the company (by Amcom/Futuris and Powertel/AAPT ) at that time to keep it operating.

On a positive note – Exetel has had a really good week in my absence (surprising how often that happens) with new applications for every service registering strong gains – particularly business SHDSL and Ethernet services – always really good to see. It was also good to see that the removal of the ADSL1 (256/64) services has had no negative effect on ADSL1 applications which, I suppose, means overall ADSL1 applications actually increased more strongly than the figures demonstrate. Churns to Exetel have also been even stronger in the first four days of this week.

I will wait until I return to Australia, but I am going to recommend that in addition to the removal of offering the 256/64 ADSL1 plans from Telstra we also cease offering the 8192/384 plans from Telstra to new users. They are ridiculously overpriced (to us – probably not to other ISPs) and I doubt whether we make any money at all on them. We will continue to provide them to customers who already have them for the foreseeable future.

I talked with our principal UK HSPA contact late yesterday who is having a pretty tough time along with the general slide in business confidence in the UK. Depending on how serious he really is about the suggestions he made during his telephone call it may be an opportunity for Exetel to test our new ideas for HSPA services in the UK in partnership with them as they have no good/workable strategy to move from their current services in terms of marketing positioning. I really like the idea of trying out some of our ideas in a much bigger market than Australia (especially with a ‘free entry ticket’) and maybe, depending on how things turn out in Australia between now and February, we could pursue our ‘grandiose’ plans for a more international Exetel presence.

Then again – maybe times are going to get really tough in Australia too and we need to become even more conservative than we are already planning to be and put in even more hours to just survive what looks like becoming a major down turn with Krudd continuing to make it worse with his stupid “me too” follow the leader actions taken without any knowledge or thought:

http://business.smh.com.au/business/perpetual-backlash-for-rudd-20081023-577y.html

What a total f***wit that man is.

I have a lot of travel time to think about all these things – and, on a brighter note, a lot of good new liquor to sample.

......It's gonna be a bright, bright, sunny day (Johnny Nash):

http://uk.youtube.com/watch?v=HagzTRmUBIE

.....but actually the rain hasn't gone - it's bucketing down here.

I have had some time to consider two aspects of Exetel’s future planning for the coming five years on the flights and in the many waking hours of the early morning that are available due to a time displacement of five and a half hours. 

I have previously alluded to the major problem that any small communications company in Australia faces especially one that has built a large portion of its business based on providing broadband services that are sourced from either Telstra or Optus. That, very simply put, is that there can never be enough money made available as ‘profit’ to actually make it worthwhile doing for any length of time – and, in my opinion, that ‘length of time’ is now receding rapidly in the planning ‘rear view mirror’.

Irrespective of any future changes that may or may not be made by Telstra the fact remains, in my opinion, that Exetel can never add enough value to a Telstra sourced service to ever make any real difference to an end user’s value. I’ve always known that doing this would be difficult and have been encouraged along the way by the fact that other companies had found, apparently, that it is possible to buy a base ADSL or telephony service from Telstra at a realistic price and add sufficient value to offer an end user a ‘better’ service than Telstra may choose to provide.

I had thought, and I fully understand that it’s the fault of my own naivete that I was so wrong in my thinking, that over time and as volumes of business grew, margins might slightly improve in terms of buying base services and that a rigorously operated, tightly cost controlled and amazingly fully automated  operation would be capable of not only providing a differentiated service but would be able to do so at a lower cost to the customer and still leave enough for the ‘business’ to become and remain ‘financially robust’.

I think if that was going to happen – five years is long enough for it to have happened by now. I can only, and sensibly, conclude that it hasn’t happened by now and therefore it’s not going to happen.

Not exactly an Earth shattering view and one might well observe that it shouldn’t have taken almost five years (on top of previous direct experience) to reach such an obvious conclusion. A valid view point – what else can I say? For even the most pragmatic of people, the triumph of hope over experience can still cloud the most incisive of minds – and I think it’s a long time ago that my mind, by the kindest of measures, could be described as incisive.

As it’s such a major decision it couldn’t possibly be made based on one person’s view.

However it doesn’t take much of a look at the communications industry in Australia to see, and only based on the published and verifiable ‘evidence’, that outside the two other largest mobile carriers and possibly TPG/SPT , Internode (about which there is no useful  published information) and undoubtedly some other company or maybe even two that I have either forgotten or am unaware of, that only Telstra is a successful communications company in Australia.

Every other communications company that has based all, or a significant part of their business on using Telstra Wholesale services either has ‘disappeared’ or has struggled on not making any money – though undoubtedly iinet et alia would dispute this jaundiced view (to which my reply would be – look at the accumulated losses on your balance sheet).

However – this isn’t an exercise in whatever other companies may or may not have achieved (as I clearly can never know any realistic details). It is based on looking at the future with the actual facts and figures of close to five years direct experience all of which say there is no realistic commercial future for a small company like Exetel basing any future plans on buying services from a company such as Telstra – or indeed any company that either does or is likely to adopt the same or similar ‘policies’.

…and by “similar policies” I mean the bizarre situation where a small company finds the ‘retail arm’ of its wholesale supplier having its retail arm directly approaching its customers offering the end user lower prices than the wholesale customer can buy for – quite a bizarre business situation when you think about it. What possible reason would a sensibly managed commercial organisation have for spending money to offer a customer they already have (via their wholesale business) cash incentives to resign with their retail business for less money than their wholesale customer was already paying them?

I can only think of one reason - but perhaps I'm not bright enough to understand what's really happening.

So – ‘no more over priced ADSL tail circuits and back haul costs for Exetel’ – from any provider – there is no way that Exetel can make any progress at all in pursuing that ‘profitless’ path. We can probably stay in business and even make a small profit and probably continue to ‘package  up’ an end user offering that may well continue to appeal to some tiny percentage of the overall marketplace for a year or so but – among other things – where is the value in doing that in the wider ‘scheme of things’?

There isn’t any – for anyone.

Buying HSPA Layer 2 services (not Layer 3) from a carrier, at the moment Optus, removes several of the issues that render ADSL services so impossible for Exetel in the future and are a realistic ‘transition phase’ because a small company (and Exetel is a good example) can much more easily ‘construct’ an end user offering that wouldn’t ‘compete’ with the carrier’s own multiple market directed offerings but would address marketplaces that the carrier itself couldn’t and would never want to address which goes a long way towards resolving the problems of a wholesaler who ‘prefers’ to do their own retailing.

The other point is that there would be a true competitor to Optus (Vodafone)in this country  that would eliminate almost all of the problems involved in the ADSL versions of broadband and its ‘add on’ services. Again, a company based on something different is much more easily ‘transposed’ to geographic areas other than Australia should that ever be considered to be a sensible thing to do.

So the issue resolves itself to something quite concrete – not providing ADSL1 services in the not too distant future or any other ‘services’ that are in any way dependent on a wholesaler who will see every market as one in which their retail operations should have precedence.

Distance and a different environment provides greater clarity of thought – or is it the propensity to have two, or three, for the road?

Damned if I ever could tell the difference.

Damned if I ever really cared now I come to think about it.

......But every night all the men would come around, and lay their money down....(Cher - still a great song)

http://search.live.com/video/results.aspx?q=gypsies+tramps+and+thieves+youtube&docid=2791912112451&FORM=TVVR9#docid=2784312033417

....Tramps.....

I read this today:

http://www.asx.com.au/asxpdf/20081020/pdf/31czgjbxpqx1q6.pdf

Pages 6 – 9 are the essence of this document which is the proposal by the second largest shareholder of Eftel  (other than the CEO) to remove the Eftel  CEO from his position for total incompetence including shareholder value destruction and of running a company that the auditors allege is unlikely to meet its financial obligations.

I, personally, have no issues with any ‘penny dreadful’  of the communications industry other than why they exist at all. I assume the second largest shareholder of this particular company (Eftel) has every right to be incensed by the destruction of his investment and the fact that the CEO of his company pays himself more money each year while the shareholders see their investments reduced to one thirteenth of the price they initially paid.

However read pages 6 – 9 for what he believes is the situation. Some concurrences in his statements to the comments  I made  weeks ago when I commented in these random musings that I found it unbelievable that so many untruths could be incorporated in a statement to the ASX are simply a belated response to other people perhaps seeing the statements made in the same or a similar way.

It really is completely irrelevant what happens to, an even tinier company than Exetel , in terms of the general communications industry in Australia but it’s somewhat indicative of how misguided investments in ADSL2 DLAMs are in an HSPA future scenario. It seems Eftel is about to become ‘road kill’ on the ever dangerous road of commercial pretension – completely irrelevant to anyone but  Eftel’s current employees and some of their customers  – perhaps.

I have never understood how a cobbled together company such as Eftel could stay in business with staffing levels 4 times higher than Exetel's with less customers and lower revenues. The salaries published for their 'senior management' alone are 3 times higher than Exetel pays for the similar functions within our very tightly managed, small company (and that includes Steve's, Annette's and mine).

I read these comments in Colombo earlier this morning  while Annette and I were having breakfast and thought it strange that so much ‘bullshit’ continues to surround such a prosaic industry as Australian communications . For goodness sake – the supply of basic data and telephony services should be left to the boring, but often competent and mostly dedicated, people like Steve and me who are more than prepared to waste our lives using our meagre  talents and capabilities to provide services that work and are cheaper for the end user than those provided by the rip off monopolies and the other assorted 'posturers' that masquerade as adequate communication providers.

It sometimes seems to me that it’s a complete waste of time to try and make an alternative to bluster and swagger work to the advantage of Australian communication service buyers – but then I get over such pointless views and continue to believe that the presence of such incredibly irrelevant companies as Eftel  (which as far as I can see is simply a ‘hodge podge’ of other  failed ISPs) is a ridiculous aberration of capitalism at its most absurd.

Anyone think that Eftel will continue to exist beyond this calendar year?

Not that it matters as they are so small and cover so little ‘geography most people will never have heard of them. (irrespective of their CEO’s claims in his 2008 report to the ASX).

Something that is of more incredible irrelevance/relevance was the claim that Telstra was seeking tax payer funding to use its grossly offensive advertising 'characters' in an unbelievable attempt to make a “feature movie” – just how ‘lost’ do you have to be to portray your prospective customers as being as stupid as those silly ads do?  Who, within the company, approved portraying Australian parents as being so careless and irresponsible about responding to their children’s questions?

How on Earth, can anyone who is Australian consider these ads trashing of Australian parenthood to be a suitable ‘vehicle’ for a movie made from Australian taxpayer taxes:

http://www.news.com.au/adelaidenow/story/0,22606,24504612-5006301,00.html

The ads themselves are offensive beyond belief. To believe there is some merit in trying to procure tax money in these really tough times to continue to propagate the view that Australian parents are ridiculously stupid is beyond my comprehension.

Perhaps I've missed the point and the ads actually reflect how Telstra sees their customers - uneducated and stupid? Having been on the end of more than a few Telstra lectures about how stupid I am not to understand basic aspects of communication technology over the past 20 years it may well be the case that no-one within Telstra actually saw anything wrong in portraying a parent as being so ignorant and dumb?

I need a triple Scotch and keep them coming if Australia ever descends to this level of 'corporate' denigration.

Not a good day for Australia when a major Australian company portrays it's prospective customers in the way those two ads have done in the first place and then thinks it's somehow appropriate that such awful views of Australian parenting should be continued in such a way. It appears to show a contempt for Australians generally and their customers specifically which is breathtaking. Or have I just lost any semblance of a sense of humour and the ads I find offensive are in fact wickedly funny and a  jolly good old sly dig at today's parenting needs?

….. as George Peppard (as Hannibal Smith) used to say in an early 1980s TV show – “The A-Team."

We arrived in Colombo around midday yesterday and had a surprisingly quick and non-hair raising drive from the airport to the hotel due to the lack of traffic (a trip that on the two previous occasions took well over an hour this time barely exceeded 30 minutes). Undoubtedly this must have been due to the very ‘executive’ hour of the flight from Singapore which instead of meaning we had to place a wake up call for 4.30 am allowed us to take off on a newly scheduled flight at 10.30 am.

The World Trade Centre where our offices are located is right next to the hotel and is an undercover few minute walk from the hotel lobby (a major plus as we later walked back to the hotel in a torrential tropical down pour). Annette (and I) were very pleased that the offices both looked really good and functioned so well – they look exactly as the ‘computer simulation’ that was done on our last visit only better 'in real life' and the view is great. Everything is so much better here than in our North Sydney offices.

We tested the telephone services (both incoming and outgoing) on a 1 mbps x 1 mbps VoIP link to and from the VoIP PBX in the North Sydney office and the separate data link via another carrier to the North Sydney and Sydney CBD data base and other servers and they were fine – as you would expect in this day and age.

The shifts in Colombo now run from 8.30 am to 10.30 pm (Eastern Summer Time with 6 people on each shift at the moment) from Monday to Friday (including all public holidays). The weekend shifts run from 1.30 pm to 10.30 pm on both Saturday and Sunday. Our new employees (the ones we have never met as James Dover did the interviewing and hiring over the past three months here) are nice people with good education and work backgrounds and the great personalities and manners that seem inherent in a Buddhist upbringing and culture.

It seems a long time ago that Steve and I first discussed how to address the issues of providing 24 x 7 x 365 support services without going down the paths we observed other ISPs in Australia following – in fact, to the best of my recollection it was getting on for 8 years ago – well before the time we created Exetel.

It’s even a little over three years ago that we ‘decided’ to commence a program of providing the support that couldn’t be done via automation from a more cost effective country than Australia. Our first two Sri Lankan engineers who worked from their homes until we opened the Colombo office came to Australia in March 2006 for 4 weeks of training and have been part of Exetel’s support processes ever since that time.

This was the start of this ambitious project of moving all of Exetel’s customer support, service provisioning, accounting and a large part of our data base and other programming from North Sydney to Colombo. The Colombo offices have now been operational for three months and, with the exception of some expected and a couple of unexpected ‘teething problems’ are achieving everything our ambitious plans aimed at.

So, our first half day back in Sri Lanka has been a very pleasant time with no ‘surprises’ and no real disappointments which, given the difficulties and magnitude of the tasks that have been so ably accomplished, is a very satisfying, and in many ways quite impressive, achievement and James Dover, particularly, can be very proud of what he has accomplished so far.

So far…….

There is a great deal still to be done and it will be many months before the skills and knowledge transfers are completed and the full management of the Sri Lankan company is put in place on a long term, ongoing basis. This is planned to happen by December 31st 2009 but there are no ‘cut and dried’ dates as so much will depend on so many things that are not either currently under our control and, almost certainly, things that are currently completely unknown to us.

So, as WSC once said, “Not the end, not even the beginning of the end – but perhaps, the end of the beginning”. As with every aspect of commercial life the real issue is never that you can do something very well today - it's how well can you keep doing it, or more accurately keep getting it done, on an ongoing basis into the distant future with constant personnel changes - that's quite another completely different set of challenges all together.

Briefly, because that's all it can ever be, I reflected as I walked back to the hotel on how we had actually made all this happen and, very briefly, I had one of those, few, ‘warm glow’ moments in commercial life when I actually felt really proud and happy about being part of something that was being done very, very well and was quite special.

We flew from Sydney to Singapore today on a three quarters empty aircraft seemingly proving the theory that "the global financial crisis" was really biting in this obvious example of an almost 'empty' flight from and to two of the most popular cities on one of the more popular SE Asian routes. Or so it seemed until we went for a stroll down Orchard Road after sitting down for the previous 8 hours and jostled our way through the late afternoon Sunday pedestrians on both sides of Orchard Road who were packing the various 'brand name' stores and, as far as we could see based on the number of bulging brand name shopping bags being carried out of the various stores, spending money in extravagant abundance on over priced and totally unnecessary goods.

One swallow never did make a summer and one Singaporean or visitor to Singapore at the start of the monsoon season never did make a rainy season but it seems in this part of the "Troubled South East Asian Region"  Cartier, Tiffany, Ferragamo and Louis Vuitton etc prices aren't a barrier to big spending by either the locals or the visitors. I contented myself by attempting to avoid the intermittent heavy rain and lightening strikes to stretch my legs and dither about buying a Nikon Digital SLR for a couple of hundred dollars less than I could buy it for in Sydney.

Singapore, as always over the past thirty years, presents a vibrant contrast to Australia in almost every aspect of modern life. A skyline full of cranes (now dwarfed in concept by Dubai and other Arab States but nevertheless excessively impressive compared to Sydney, Melbourne or Brisbane) and an array of beautiful 'CBD' builings that make Australia's major cities look third rate. A bustling urban population that is so significantly better dressed and dressed more fashionably that even a dinosaur like me can't help but notice the difference between the pedestrians on Orchard Road in their chic elegance and the dowdy denizens (both male and female) of Sydney's major CBD streets.

I spent the pleasant 7 hour plus flight (Singapore Airlines is to Qantas what Tetsuyas is to the Cremorne MacDonalds) considering what Exetel might do over the coming twelve months in terms of service offerings and pricing interrupted only by the need to deal with breakfast and lunch offers from the ineffable Singapore Girls who define customer service in the commercial aviation industry - and I would venture - in any other service industry.

How could the Singapore Airline 'experience' be delivered in the Australian communications industry? Whoever aimed at that 'target' and then successfully achieved it for the last thirty years (in my experience and in so many analytical surveys) has managed to encapsulate what appears to be the realization of every passenger's expectation - perfect service delivered effortlessly by every employee - a truly amazing accomplishment.

I would like to be associated with an Australian company that could do half what Singapore Airlines do - I have flown a lot of times on commercial airlines in my life and, in my experience, Singapore Airlines do the same things every other airline does - but what they do ALWAYS makes me feel better than the same things done by other airlines.

How is that possible in an industry where:

Every airline uses the same aircraft

Every airline uses the same crew:passenger ratios

Every airline pays the same fuel and maintenance prices (possibly not the Oil rich State airlines for fuel)

Almost every other cost and delivery aspect is the same

It was a salutary, and humbling, experience once again to fly Singapore Airlines and find the experience to, once again, be better than flying the same route, on the same aircraft, in the same seat as every other airline.

What is their 'secret'?

Once we get the current support and service improvement program completed (scheduled for the end of 2008) we should look at a new program in an attempt to emulate the stunning, and sustained over decades, service standards achieved by SIA.