John Linton
.....and I think we just spent the very last of our 'investment money'.
We bought more floor space in the building we already own a floor in yesterday to correct the mistake we made when we moved into the original floor last June. Our/my mistake was not allowing for the larger than planned amount of floor space we used to create our own 'data centre' which was stupid of me and has had to be corrected. While the decision to build a larger data centre than originally planned was sensible as we slowly migrate some of our routers and servers from one of our two CBD colos it has made our plans to build a much larger corporate sales force more difficult - so buying the extra space became a must. We decided against renting as it's clear that is a stupidly expensive option if it can be avoided. We managed to buy the space in our current building at an acceptable price to us, and perhaps not such an acceptable price to the vendor, but it was his decision to accept our offer of course. If the commercial property market has 'recovered' since we bought the first floor at what was being described as the "depths of the commercial property slump" by the agent who sold it to us there doesn't appear much change some 9 months later from the little we were exposed to.
The new space will enable us to move our Australian based F and A and Data Base development personnel and some other 'sundry' people (like me) from the current offices allowing us to proceed with the next phase of our corporate sales growth which is building the current team from 12 to 24 personnel and to give us time to evaluate just how far we can continue to grow corporate sales as a totally Sydney based operation before having to establish a 'local' sales presence in Melbourne and, perhaps Brisbane.....something that will have to be considered. Our other option is to move the sales operation if it grows beyond 24 or so people into dedicated premises somewhere in the CBD and convert more of the current floor space in to a dedicated colo facility for smaller business customers. All of that is in the future of course but the future has this inconvenient way of arriving sooner than you are ready for so often.
The residential marketplaces continue to defy our predictions on a daily basis but indications are that they are becoming tougher for some of our smaller suppliers who are offering us better pricing without us having to ask - never a sign that all is well in them meeting their targets. The most obvious 'dying product' is wire line calls where VoIP is making increasingly bigger inroads into the bloated wire line call charges of Telstra and the companies that compete in this market with Telstra. Our VoIP business, like everyone else's I have no doubt, continues to grow and the little wire line business we do continues to fall, albeit slowly as we don't charge rip off prices for wire line calls. While VoIP prices are already very low it seems likely that we will be able to reduce our national/local call rate from 10 cents to 9 cents a call and our CTM rate from 22 to 15 cents a minute from March 1st. We will try to put in place a ''package' price for national/local calls of 5 cents a call for our ADSL residential customers at the same time which, we would think, would persuade even the most sceptical and technically challenged customers that VOIP is the only way to go in the 21st century.
A key aspect of developing the corporate business at the rate we have planned is to significantly increase the percentage of our corporate data customers to also use Exetel for their outbound telephony via VoIP. We have made little progress in this aspect of the business to date because we have been training our corporate sales force to thoroughly understand the data carriage services and it would not be sensible to try and add another relatively complex service to that training regimen. Exetel's in house use of VoIP is, almost certainly, at the very highest levels of 'sophistication' in almost any method of evaluation and we know a great deal about how to implement robust and sophisticated VoIP services. How well we can transfer that knowledge and make convincing cases to sceptical commercial entities will determine how successful we are in growing our corporate business. The rate of increase in monthly new customers in the first year of the program has been very impressive so far but the real challenge comes now as the 'concentrated' excellence/knowledge of the mentoring program becomes more and more diluted.
It's certainly not going to be a business year that lacks challenges.