Tag: business

You don’t wanna be on the front page.

Nothing amuses a journo or ruins a PR’s day more than a CEO or founder declaring “we want to be on the front page of x publication.”

The sensible response to that demand is ‘why?’ and it’s an important question for anyone looking for media coverage.

Usually ‘x publication’ is the nation’s major business outlet, think the AFR in Australia, the FT in the UK, or the Wall Street Journal in the United States. Every country has its equivalent.

Positive stories leading a site or paper aren’t something easily won, unless you’re buying space which is a different story.

However, regardless of whether you’re buying space or you’ve earned a story at the top of the page, is it something you really want and, if so, why?

A favourite story of mine involves an old colleague who was editing one of Australia’s top tech magazines (back in the days when front cover CDs drove sales).

Her magazine awarded ‘PC of the Year’ to a small suburban computer shop, resulting in that store deluged with orders.

Great news, right?

Not so for the business as the owners found themselves overwhelmed with work and, shortly after, buried with customer complaints as they struggled to meet demand. Eventually they went out of business with a horde of disaffected clients and consumer affairs on their tails.

Most business owners don’t think through why they are looking for publicity – if you suddenly get attention are you risking ending up like that suburban computer shop?

The answer to the ‘why’ question often turns out to be complex – some businesses are looking to juice sales or build their brand; others, particularly in the startup space, want to get on investors’ radars; while high-growth businesses may be looking at attracting good quality staff.

And there’s ego, which is often the biggest driver of the “I wanna be on the front page” demand.

The latter’s easy to get dispel with a litany of all the times CEOs and founders careers have been scuppered by a high-profile scandal on the front pages – basically the “you don’t wanna be on the front page” reply.

More complex are the other motives, and they require a nuanced, well-thought out strategy with the audience and the desired end result being key considerations.

Often, that audience is more in a niche publication, or even the company’s own social and owned channels, rather than a city or national publication.

While it’s a good ego-stroke to see yourself illustrating the day’s top story in the national business paper, for most organisations that’s not where the real benefit of media coverage lies in building a name, selling a product, or catching the eye of well-heeled investors.

Sensibly thinking about where you want to be seen is the first step to getting coverage. Of course, you still need to have something decent to cover.

But, no, you really don’t need to be on the front page.

No promises from the NBN – the nation building project that guarantees nothing

Australia’s NBN originally promised much, now it guarantees nothing.

Since Australia’s National Broadband Network has started ramping up its connection, the project has been plagued with complaints of underperformance, culminating in Telstra admitting thousands of its customers were entitled to refunds.

Today the national customer rights watchdog, the Australian Consumer and Competition Commission published a range of guidelines for advertisers, something I covered for Mumbrella.

What’s striking though – apart from the ACCC’s adding a new layer of complexity with ‘minimum typical busy period speeds’ is the regulator’s requirement for ISPs to state maximum evening speeds on the network, with the cheapest plans offering no guarantees of speeds at all.

There is no qualifying minimum speed for a plan labelled as ‘basic evening speed’ given there is no slower speed tier to which a consumer could move.

By the ACCC’s figures, a third of subscribers on the NBN to date are on the lowest speed plan with no guarantee of any speed at all.

The telephone system being replaced by the NBN at least guaranteed a dial tone and data speeds slightly better than an acoustic coupler, now a large proportion of Australians will not even get that.

Australians are spending at least $50 billion dollars on a project that will see a third of the nation going backwards, future generations are going to wonder how we managed this.

Appointing the wrong crew to your cargo cult

The folly of vague objectives is compounded by appointing the wrong team to a project, as Advance Queensland has found.

The government is hopeless says Mark Sowerby, the soon to retire Chief Entrepreneur of Queensland.

Sowerby’s views are a long way from the heady days of a year ago when it was announced he would lead the state’s startup policies.

The sorry tale is a classic tale of all parties not really understanding what they were getting into.

In Mark’s case, he admits he had little of idea of how government operates;

To be honest my experience with government has been limited and I’m going to limit it to zero after this job – but bloody hell does everyone get everything wrong.

I came in with fresh eyes and lots of hope and I am just disgusted. It’s extraordinary to me how hard it is to get the simplest things done.

Sowerby’s poor understanding of managing governments and stakeholders should have been a warning sign for Advance Queensland but they themselves really didn’t really know what they wanted, as the Entrepreneur In Chief job description says;

He will act as the state’s startup ambassador working with local, national and international entrepreneurial communities to help develop and grow Queensland’s innovation ecosystem and attract investment.

From that description it’s clear the Advance Queensland panel sees “the knowledge based jobs of the future” coming from Silicon Valley type tech startups.

Thinking an official government entrepreneur with a funds management background will create a startup ecosystem is another example of cargo cult thinking from Australian governments so it’s not surprising the appointment failed.

Despite his unsuccessful tenure, Sowerby should be an asset to the Queensland government in an advisory role given his proven skills, experience and networks. It’s a matter of putting the right people into the right roles – and understanding your own objectives.

The myths of dead brands – busting disruption stories

Blockbuster, Nokia and Kodak are cited as victims of digital disruption. Things however are not so straightforward.

“These three brands have one thing in common – they’ve all been destroyed by digital disruption,” says one business commentator in a recent presentation.

He cited three names; Kodak, Nokia and Blockbuster.

It’s a nice, and often repeated meme, which is only really true of Blockbuster which failed to adapt to a changing market and could be a perfect example of a transition effect although some don’t buy the digital disruption reason for the company’s demise.

Giving lie to the idea the company was a victim of Netflix’s rise, a former Blockbuster executive puts the chain’s bankruptcy down to management not understanding the company’s role in the market, and that it was in decline long before the streaming service’s arrival.

A more fundamental problem with the statement is both Nokia and Kodak are still in business too, the latter having come out Chapter 11 financial in late 2013.

Finland’s Nokia is somewhat more complex than Kodak or Blockbuster, having been founded as a paper pulp mill in 1865.

The company became a global brand thanks to being a leader in mobile phones prior to the iPhone disrupting the market but the name faded as the Apple and a new breed of East Asian manufacturers came to dominate the market.

Despite fading as a consumer brand, the company is still a major player in telecommunications – being a major supplier of cellular base stations – along with a range of other technologies.

Both Kodak and Nokia are still very much alive, albeit no longer being recognised by the average consumer.

There are major lessons from both companies for those studying the effects of technological disruption on brands and businesses. Even Blockbuster’s mistakes in the face of a changing and declining market has many lessons.

Citing them as examples of ‘digital extinction’ though is untrue and almost certainly unhelpful in understanding what management can do to respond to new technology or societal shifts.

Being an industrial revolutionary

The World Economic Forum’s Nicholas Davis on being an ‘industrial revolutionary’ in the digital age.

“The future isn’t pre-determined, technology doesn’t come from some outside force. It’s created by us. Some people have more power than others in that system, such as the big tech entrepreneurs, but at the end it’s people and organisations that have the power.”

Nicholas Davis, the World Economic Forum’s Head of Society and Innovation, was discussing at the recent Sydney CeBIT conference how we can take control of the digital economy and where workers fit into an increasingly automated world.

Technology and online platforms aren’t neutral system, Davis observes. “It’s not just about how we use them, but the values that are designed into the systems, technology is not just a neutral thing. During a conversation like this if I put my iPhone between us, it’s proven that reduces our memory of that discussion and our sense of connection.”

Politics and addiction

“The purpose of the technology, the design of it, affects us in different ways.” Davis says, “if we design technologies for addiction, if we design business models that involve us being sucked into systems at the expense of other things in our lives, then that is a value choice that companies make and that we as users are trading off in our lives.”

“In understanding that technology is not neutral then the question is how we, as revolutionaries have that political discussion? I don’t mean political like ‘Left’ and ‘Right’ but these are value decisions that we need to engage with.”

“The difficulties about having discussions about technology is not getting sucked into a left-right divide and letting one group of people own innovation, but to say what do we want, How do we get there and how do we avoid the mistakes of previous industrial revolutions where the environment suffered, kids suffered and vulnerable populations suffered.”

A change in thinking

“One of the biggest problems is we don’t have regulatory or even democratic institutions where we can make collective decisions about technologies,” says Davis.

“The average AI researcher, at the top of their game anywhere in the world, would only understand a small percentage of the AI space. So how do you expect a politician or a voter, to come to grips with it.”

One of the key discussions missing in the public sphere is around automation and concepts like the Universal Basic Income, Davis believes. “We should have a serious chat about giving everyone the space to build up their skills.”

In the development policy, Davis sees growing inequality and applying last century’s thinking to today’s challenges as among the biggest risks facing governments and communities.

Rippling beyond business

For business, the imperative is to recognise the effects of decisions on the wider community.

“The big thing for business is understanding the technology decisions you make have a ripple effect beyond your company, you need to look forward to new ways of value adding.”

Davis warns we are seeing a backlash against innovation and technology with concerns about privacy and security growing.

“So much of the world is build on their use of data. Most companies and organisations don’t have good data hygiene or ontology to classify their information. People say data is their greatest assets – some say it’s the new oil – but it’s also their greatest liability. So understanding information security at the board level is critical.”

The power of individuals

For individuals, Davis believes the power lies with us in the choices we make as consumers.

“Don’t underestimate your own power, but also don’t underestimate that more and more products around us are designed to influence our behaviour in ways we need to be aware of.”

“In most cases, if the product is free then you and your data are the product, understand that and on what terms is important.”

Conscious choices

“Understand the externalities of these services as well. Appreciate the effects it has on your family, your mental health, on the ability to connect is important. Being able to make conscious choices about these things.”

“Supporting open data standards and competition – not just accepting Android or Apple for instance – rather than allowing politicians and big business to fight over these things.”

So in Davis’ view being an ‘industrial revolutionary’ in the digital era is a matter of being an informed, and empowered, consumer. Will that be enough?

Keeping the cyber utopian dream alive

So far the internet revolution has disappointed the cyber utopians. But we live in hope.

“I stand before you as a failure,” was how I opened my presentation at the Talking Justice conference last weekend. “If I were giving this talk ten or fifteen years ago, I’d have described how the web and social media were going to usher in a new era of democracy and accountability.”

“Like most of the cyber utopians, I was very, very wrong.”

Basically we were wrong because we didn’t see how the internet would concentrate rather than diffuse power or the extent of how new gatekeepers and monopolies would be replaced the old ones.

My friends and I were not alone, in a somewhat rambling interview with the New York Times Twitter co-founder Evan Williams describes how “the internet is broken” and how he thought the messaging service could make the world better.

“I thought once everybody could speak freely and exchange information and ideas, the world is automatically going to be a better place,” Mr. Williams says. “I was wrong about that.”

Instead Twitter has become home to trolls, harassment and misinformation, something that saddens Williams and most of us who thought the web would bring about a more open and fair society.

Hope isn’t completely gone though, we are still in the early days of social media and the internet so the current trends may only be a transition effect as audiences, markets, regulators and the community get to grips with the new medium.

There’s also Amara’s law which states we overestimate the effect of a technology in the short run and underestimate the effect in the long run.

So it’s best to be a pessimistic optimist where one accepts in the short run things are dire but over time things will turn out well.

We can only hope.

Tinny vapid crap – last week’s links

Links for last week – from Apple’s child free campus and the NBN’s coffee machines to Elton John’s take on modern pop music.

Last week was an interesting time with an appearance before a Senate Committee and a trip to regional Victoria to talk about the media and social justice.

While busy, there was time to read some fascinating articles ranging from Elton’s John’s views on modern pop music, software lawsuits and early losses in the war on ‘fake news’ through to how the shiny new Apple campus boast almost everything for employees except a childcare centre.

Parents need not apply

Apple’s new 5 billion dollar campus is the realisation of Steve Jobs’ final vision. It boasts a hundred thousand square foot gym and an attention to detail that extends to the sand used to make the windows.

But it doesn’t have a day care centre, which gives a pretty clear message to aspiring employees – if you don’t have a stay at home spouse, something pretty rare in the hyper expensive Silicon Valley, then don’t bother applying.

Thanks a latte

Meanwhile in Australia, the government financed National Broadband Network is spending half a million dollars a year on maintaining its staff coffee machines.

While the money is small change in a project recent estimates put at costing $56 billion, it is emblematic of how far from its original purpose the vision has drifted.

Facebook Fails to Tackle ‘Fake News’

The social media’s attempts to tackle ‘Fake News’ are failing dismally reports The Guardian as reactionary groups gleefully reshare and publicise anything flagged as such.

While it’s early days, this isn’t a good start for Facebook although it also illustrates how powerful filter bubbles are and the lengths people will go to spread their ideologies.

The lawyers always win

Lasts week’s ransomware scares will trigger lawsuits says Reuters, quoting several legal experts.

Unsurprisingly, it won’t be Microsoft who’ll be the target given their almost bulletproof terms and conditions but businesses who didn’t patch their systems could be liable.

Fox News’ founder passes

Roger Ailes, the founder of Fox News and one time Nixon adviser, passes a few months after being ousted from the network he created.

Ailes personified the tabloidisation of the media as Rupert Murdoch applied the model which had worked so well for him at The Sun in the UK to newspapers and television in the United States.

Many blame the internet for the click bait, sensational model of modern news reporting but the pattern was well established by the time the World Wide Web came along in the mid 1990s.

Tinny, vapid crap

Elton John weighs in on the state of pop music.

 

Journalism in the Twenty-First Century

Where does Australian journalism go in an age where media channels are dominated by Facebook and Google?

Today I’ve been invited to appear before the Australian Senate’s committee on the Future of Public Interest Journalism. Here’s my planned opening remarks looking at the challenges facing media organisations, particularly in an Australian context.

I’d like to start off by pointing out I’m not a career journalist, I fell into the media industry through a series of happy accidents starting with appearing on ABC Radio to discuss the Y2K bug twenty years ago, this evolved to where I’m now a freelance contributor to all the major Australian media outlets.

As a longstanding contributor to various ABC stations across Australia ranging from ABC Darwin through South Australia’s Riverland to the national Nightlife program where the hosts pretend to be floating somewhere above Middle Australia rather than admit they are in the Sydney studio, I have seen some profound changes within the organisation.

Due to cost cutting and political interference, the organisation has steadily seen power and resources concentrated in the Sydney head office to the detriment of local coverage and regional stations.

To be fair to the ABC, the same process has happened in commercial media – in print, radio and television – as flawed policy decisions over the last forty years have seen market power accumulating in Sydney and Melbourne at the expense of local content, diversity and regional coverage.

Wasting the digital dividend

One of the great missed opportunities of our time was the gifting of the digital TV spectrum to the established radio and TV operators.

The digital broadcasting switch was an opportunity to bring diversity back into Australia’s media landscape and spur both journalism and the creative industries.

A few minutes watching what the Free To Air networks have done with those new channels shows how that resource has been squandered.

This concentration of market power has left Australian media organisations saddled with a protected and well paid breed of managers incapable of responding to the threats posed by US and Chinese social media networks – not to mention streaming services like Netflix or the continuing catastrophic declines in advertising revenues.

Journalism as a team effort

Producing quality media to compete globally is a team effort. Good journalism isn’t just the result of good reporters, it requires good sub-editors, producers, researchers, photographers and a small army of other skilled workers. Not to mention strong, principled editors and station managers.

The media industry’s casualisation, something as freelancer I’ve encountered the brutal reality of, makes it difficult to develop those skills. The ABC is a good example of this where, outside of management and administration, there are few salaried staff aged under 40. This has great ramifications for the workforce, industry and the community.

It’s difficult to see what governments can do in the face of the global industry’s changing economics, particularly in the advertising industry’s shift.

We should keep in mind however if we were having this discussion a hundred years ago we would have been asking how people can make money from radio. Entrepreneur David Sarnoff who founded Radio Corporation of Australia figured out the commercial broadcasting model in the 1920s and that industry went on to become one of the most profitable of the last century.

So it may well be that encouraging a new generation of media entrepreneurs and journalists who can figure out 21st Century business models can be the best thing Parliament can do to ensure a diverse media culture that tells modern Australian stories to today’s Australians.

Champagne tastes and short runways

In an age of startup unicorns, it’s not surprising investors are being burned

One of the curious things about the Silicon Valley business model is how fundraising is seen as an end in itself.

Most business proprietors would be philosophical or mildly irritated if they’d had to give up equity or go into debt to fund growth, but in startup land a whack of money is seen as success in itself.

Sadly that money isn’t always well spent as the story of the free spending Guvera streaming service shows.

Over the company’s eight years the founders raised $185 million which ran out last week leaving the 3,000 small investors out of pocket.

That small investors were even involved in such a venture raises eyebrows and suspicions aren’t helped by a funds manager charging huge commissions for their services.

 

Just the use of a middle man like AMMA Private Equity – which happened to be run by one of the co-founders – should have raised concerns however the high commissions should prompted questions from the investors about advisors’ interest in getting them into a high risk venture.

In the current overheated startup space it’s necessary to be skeptical about many of businesses claims and the amounts of money being raised, as big pots of honey attract the flies.

Ransomware and innovation – links of the week

A Friday afternoon outbreak of ransomware dominated the week’s links along with the ethics of driverless cars and artificial intelligence.

Last week finished with a big bang as the Wannacry ransomware attack spread around the world with a curious twist which led one New York Times columnist to suggest software companies need to take more responsibility on security.

In the meantime the world goes on companies still struggling with the definition of innovation and Facebook crushing anyone who dares to try out-innovating them.

On a lighter note, Cary Grant spend much of his Hollywood years on LSD but it all turned out well and VentureBeat asks do humans have a role in a world run by Artificial Intelligence?

The future of humans

Is there a future for humans in a world run by artificial intelligence controlled robots? Venture Beat staged a panel in New Orleans that looks at where we fit into the automated world.

Ultimately the panel concluded, it’s up to us to make some serious choices. Something we shouldn’t leave to engineers.

The ethics of driverless cars

Autonomous vehicles should give priority to occupant over passers by in the case of an emergency suggests a Mercedes Benz engineer.

Christoph von Hugo, Mercedes’s manager of driver assistance systems, probably hasn’t helped the development of autonomous vehicles with his comments but the ethics of driverless vehicles is a discussion we should be having.

Defining innovation

Innovation is very simple, it’s about trying new ideas says Pete Williams, Deloitte Australia’s chief edge officer.

“You need ideas, they need to be new, new for you. If everyone in the world is doing something and you haven’t done it and you do it for the first time, you’re innovating. You’ve got to try stuff. Not just have new ideas, you’ve got to try stuff. Innovation is something you do,” he said.

Rethinking public transport

British transport app Citymapper is to launch its own ‘popup’ bus service in London with the promise of a modern and user friendly operation. An interesting twist for a software service.

“There will be a large screen that shows riders where they are in real time, and what’s coming up on the route — similar to how its smartphone app works. And they also have USB charging ports.”

Snapchat feels the market chill

One the darling unicorns of the tech industry, Snap, reported its first results as a listed company and the results were not good as Facebook’s shameless copying of the service’s features takes its toll.

Sadly Facebook seems to be following the Amazon playbook of crushing upcoming competitors that refuse to be bought out. This is a part of a broader problem with modern American capitalism.

What is Wannacry

Security researcher par excellence, Troy Hunt, gives a full run down on the Wannacry ransomware and how to combat it.

Towards the end of his article he has a list of eight actions computer users – from major organisations to households can do to protect their systems. Depressingly these are exactly what the computer tech support industry has been telling people to do for the past twenty years.

Wannacry’s accidental hero

An anonymous British IT security researcher realised the malware has a ‘kill switch’ – so he activated it. He does have an important message for computer users though.

“This is not over. The attackers will realise how we stopped it, they’ll change the code and then they’ll start again. Enable windows update, update and then reboot.”

An age of insecure machines

One of things that might bring down an AI controlled world is insecure machines as Wannacry shows. In the New York Times technology commentator Zeynep Tufekci suggests we can’t stop the wave of attacks taking advantage of systems running out of date software and vendors need to take responsibility.

“It is time to consider whether the current regulatory setup, which allows all software vendors to externalize the costs of all defects and problems to their customers with zero liability, needs re-examination.”

100 trips in tinseltown

Cary Grant got through his Hollywood years by microdosing on LSD claims a new documentary. When he retired from the movies he quit the speed and lived happily every after.

Interestingly, microdosing is one of the strategies used by today’s Silicon Valley workers to get by in their stressful and demanding roles. Some things never change.

Earworm of the week

Freelancer and the sugar daddy problem

Attempts to create hands off marketplaces fail as the realities of managing millions of users becomes apparent

Last week Facebook’s Mark Zuckerberg announced the social media platform will be hiring three thousand content moderators following a string of shocking incidents on the company’s live streaming service.

Facebook were the most successful of the generation of businesses promising algorithms and the user community – coupled with common sense – would act as gatekeepers.

That was handy for their business models, as the reduced administration costs would mean a much more scalable and profitable business.

Managing users’ sins

Along with Google, AirBnB and Uber, Facebook found that relying on users’ feedback and their own algorithms wasn’t enough to cover the myriad of sins humans commit or one in a million edge cases which occur a thousand times a day when you have a billion daily users.

Even the biggest of the web2.0 companies, Google, found their core business being shaken as the limits of algorithmic advertising were explored and advertisers didn’t like where their brands were appearing.

Most striking was AirBnB who quickly found ignoring aggrieved landlords didn’t work when you’re a billion dollar company. Uber, Facebook and Google have similarly found the “we’re just an agnostic distribution platform” doesn’t fly when you’re boasting millions of users.

Freelancer and the sugar daddies

Which brings us to Freelancer, the labour sites were always problematic in this space as services are rife with ripoffs, misunderstandings and inexperienced operators – on both the seller and buyer side.

Another problem though which seems to be appearing is the advertising of adult services on this site, such as this advert which appears to be either an advert for a sugar daddy or a webcam performer – the mangled English makes it hard to tell.

Bizarrely a Freelancer administrator has removed some of the advert’s content but has left the post itself up.

Clicking on the related links brings up a whole range of strange projects including someone who needs a photoshop expert to insert an individual into sex photographs.

Holding the service harmless

It’s hard to say whether these posts comply with Freelancer’s Terms and Conditions as they are the usual vaguely written screeds seeking to shift all responsibility away from the company which have become the norm with online services.

The reputational risk to Freelancer though is real, as company listed on the Australian Stock Exchange it has public investor base and, given its competitive market, it has to appear respectable to user – becoming a Tindr for adult performers – is probably not where organisation would like to be positioned.

Hitting the profit margin

Ultimately though Freelancer’s problem in this space is the same as most online platform services, the promise of negligible administrative costs is an illusion as managing a large user base brings up legal, regulatory, reputational and even political risks as Facebook is finding.

Like many of the early promises of the internet, the idea of a hands off platform where users do the work while owners sit back and pocket profits has gone. Where there’s people and edge cases, there’s risk and those profits may not be as great as they appear.

Crowdfunding the energy revolution

As technology changes so to do business and investment rules. The solar energy market is a good example.

“We have no shortage of investors,” says Tom Nockolds of Sydney community solar farm group Pingala in an Australian Broadcasting Corporation’s report on small business power projects.

The ABC’s report focuses on Bakers Maison, a suburban Sydney bakery that raised 400,000 dollars to extend its solar solar electricity system to slash its power bills and promises investors a seven percent return on investment.

Seven percent is very good in these days of low yields so it’s not surprising investors are lining up for projects.

It’s also an indictment on the modern banking system that smaller businesses like Bakers Maison have to issue debt directly to the market rather than getting a loan, which would have been normal a generation ago but today Australian banks would rather lend to property speculators than productive businesses.

This isn’t to say such fund raising is without problems as there is a real risk of fraud which Australia’s prescriptive fund raising laws are designed to avoid, even at the cost of stopping genuine investments.

“We’ve had to duck and weave our way through the regulations to set up this kind of operation,” says Warren Yates of Clear Sky Solar Investments – another volunteer group – about the laws which were developed after the financial scandals of the 1960s mining boom and the 1980s entrepreneur period.

As a consequence, the ABC story points Australia is lagging jurisdictions like Germany, Denmark and Scotland in developing these schemes.

With the banking system having left the field of funding growing businesses and responsibility largely falling on volunteers to provide services, reforms encouraging community crowdfunding need to be developed to provide capital to industry and local initiatives.

That many of the current reforms in this area such as America’s Jobs Act or Australia’s Innovation Agenda focus on a narrow set of industries – specifically the tech startup sector – which means we’re missing most the value in an evolving economy. A bakery, factory or hotel deserves the same investment advantages as the next potential tech unicorn and they could employ just as many people and deliver even more benefits to the broader economy.

New technologies have always demanded new investment and business rules and we’re seeing those pressures developing today, all of us have to demand regulators and politicians pay attention to the changing needs of our economy.

With investors clamouring for new opportunities and businesses wanting capital, it would be a tragedy to miss the possibilities of today’s technological, financial and energy revolutions.