Author: Paul Wallbank

Paul Wallbank is a speaker and writer charting how technology is changing society and business. Paul has four regular technology advice radio programs on ABC, a weekly column on the smartcompany.com.au website and has published seven books.

Respecting your network

This article orginally appeared in Smart Company on November 25, 2008

Australia’s Spam Act is just over five years old, and it’s had some success in keeping locally sourced junk email to reasonable limits along with catching the odd perpetrator.

The Australian Communications and Media Authority has plenty of Spam Act information for business owners on its website and the requirements can be summarised in three principles – get consent, identify yourself, and make it easy to unsubscribe.

Before you can send commercial emails to people, they need to ask for them. In itself, this requirement eliminates your emails being classified as spam given the definition of spam is unsolicited emails.

Identity is important, as the recipient needs to know who the email is from. All legitimate businesses should have no problem with this.

Finally, unsubscribing is simply good manners. For a business owner there is absolutely no point in irritating potential customers and partners who don’t want your messages.

The sticking point in all of this is defining consent. The loophole in the act defines “inferred consent” if you have an “existing business relationship”. The current interpretation of a business relationship is merely having the business card of the recipient.

Sadly this gives any dolt you’ve been foolish enough to give a business card to at a networking function permission to bombard you with invites to get-rich-quick seminars and share boat schemes.

I can’t tell you how irritating I find idiots sending me three pointless emails a week because I put my card in the door prize bowl or gave the courtesy of exchanging cards while talking.

Even worse are the dills who start sending SMS messages to your mobile phone. In fact I’m amazed that anyone thinks ultra intrusive text spam is an effective way to generate goodwill for a business.

A particular difficulty with spamming people in your network is that your paths will almost certainly to cross again, which can put all parties in a difficult position.

So don’t simply add everyone who gives you their business card to your mailing list. By all means send them a follow up email, phone call or postcard, and certainly offer to connect to them on social networking sites like LinkedIn and Facebook, but spare everyone the spam.

Understanding your responsibilities under the Spam Act will help you get more from your mailing lists. Adding some common sense and manners goes a long way too.

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Second hand PCs

Gartner reports that less than 50% of second hand PCs are making it into the resale market. I’m surprised it’s that many given the restrictive software licensing, particularly for Windows.

I imagine the supply is going to dry up even more over the next few years as people start to hold onto their computers for longer.

Where we’ve seen business computers last three to five years I expect we’ll see the life of office and basic home PCs blow out to eight to ten years.

There’s three reasons for this; web based applications, little innovation and the recession.

The recession is a no-brainer. As I posted previously, computers purchases are deferrable and as money gets tighter users won’t replace them until they are throughly flogged.

This isn’t such a bad thing for users as there’s little compelling reason for buying a new computer if the current is working fine. For the majority of users who surf the web, type letters and do the odd spreadsheet they could get by with an eight year old computer.

Running eight year hardware becomes even easier if you’re running web based apps. As long as your system can run a reasonably modern browser, all the rest will follow.

This raises big problems for the bigger vendors. They are going to have offer some pretty compelling reasons for buyers to junk their old systems.

In the meantime, buyers of used systems might find the market remains tight.

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Social networking and old media

I’m currently attending the Online Social Networking and Business Collaboration World Conference.

There’s some interesting perspectives on where social networking is going and how people are going to make money from it.

Personally, I think too many of the big players like Bebo and MySpace are too fixated on the old broadcast media model of top down content where they control everything.

Particularly fascinating is how dismissive many of the attendees are of YouTube and Facebook. The funny thing is there were five people around me with laptops on and all of them visited their Facebook pages during the morning seminar.

The icing on the cake was on the bus home. The girl in front of me had her MacBook open and she was editing her Facebook page.

It seems to me the big established media companies are struggling with their investments in the social media space. 

More on this later.

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Sweet point for iPhone apps

Thanks to Techmeme, I came across an Venture Beat article that illustrates some of the points in my earlier post.

The $9.99 iPhone app is exactly these price points at work. The price isn’t too much to discourage buyers but equally allows the developer to turn a profit from the application.

It’s interesting how the price points settled so quickly in the App Store and how a similar thing happened with the 99c price point in iTunes.

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Where does your business sit

One thing that’s been in my mind recently is how businesses will survive the downturn.

The way I see it is there are three broad segments we can put business and products into; essential, deferrable and discretionary. These are going to need different strategies to survive.

Discretionary

Stuff we don’t really need.
Examples: Expensive travel, cafes, TV’s, spa baths, gourmet food, farmer’s markets, designer shoes, branded bottled water, 90% of what’s on sale at the typical suburban shopping mall.

If your business is in this category then you have a problem. You’re going to have to demonstrate some sort of need or value to the customer. 

To survive in this category it’s going to take innovative thinking in marketing and production along with some radical revisions of pricing and cost structures.

We see some of this with fast food chains offering things like 99c and $1.99 meals. I expect we’ll see many cafes offering 99c coffees and restaurants offering $19.99 “recession buster” meals.

To make money on these deals business owners are going to have to keep a canny eye on their costs, the prices customers want to pay and be very innovative in their marketing.

Deferrable

Things that can be put off for the moment
Examples: Computer repairs, mechanics, homewares, mobile phones, motor vehicles

As a former computer tech, this one’s close to my heart and there’s no doubt the tech sector’s already being crunched by this as people put off purchases and maintenance.

The key to surviving here is in motivating customers not to defer purchases. It’s going to be a matter of cutting costs and reviewing product range and price points.

This means more marketing that emphases the benefits of your product (eg cleaning up your computer extends its life and saves you money) or making the service more affordable (eg 30 point inspection service for $29.95).

Essentials

Stuff we can’t do without.
Examples: Basic groceries, energy, telecoms, shelter

Strangely I think this sector will see the most blood on the floor. For the simple reason too many business owners believe their products are essentials.

A good example is the belief if you are in food and groceries you should be fine. That’s only true if you sell food and groceries people need and can afford.

For instance many of those stall holders at your local farmer’s market might sell food, but people don’t need cold pressed, extra virgin olive oil at $20 a litre or ash rolled goat’s cheese at $40 a kilo.

Even if you are selling basics, you’re going to have to watch your costs and your competitors. You need to be able to meet the price point savvy consumers will demand in the next few years.

If you’re selling tomatoes a $7.99 a kilo when the guy around the corner is getting them out the door for $4.99 then you need to look at your suppliers and your costs.

The overriding themes through this post are “price points” and “marketing”.

We are going to have to let them know we can deliver what they want at the price they want.

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How the ACMA blacklist works

One of the comments to my Smart Company column took me to task on how the Australian Communications and Media Authority compiles the website blacklist. I’ve put the comment and my reply which explains the process below.

I should also add the blacklist only applies to sites hosted outside Australia. ACMA will direct an Australian hosting serivce to take down any site rated X18+ or refused classification .

Paul, you incorrectly write that it is up the classification board to decide what is blacked out. That is incorrect as they only have jurisdiction on what is published within Australia. The blacklist is currently maintained by ACMA, so which minor public servant gets the job of surfing the web looking for something they can add (as well as responding to any ministerial hints about “unwanted” material).

If it was a transparent process, the material had been vetted against Australian standards then maybe. Or rules by a court. But not a secret list. No way.

Thanks for your comment, Richard. One of the big concerns about filtering is exactly how an appeals process or independent oversight of a blacklist will work.

ACMA refers any complaint about a website to the Classification Board. The board then classifies the site under the same system used for computer games and movies. If the board refuses classification or gives the site an X18+ rating then ACMA adds the site to the blacklist. The details are on the ACMA and Classification Board websites.

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Why Internet filtering is bad for business

The proposals for an internet filter risk hurting innocent businesses by blocking websites.

This article orginally appeared in SmartCompany on the 14th November 2008

As reported in SmartCompany last week the Federal Government is proceeding with trials of internet filters that will restrict Australian access to the world wide web.

The aim of internet filtering is to block child abuse sites from Australian web surfers. While the idea is well meaning, the proposal will be an additional burden on business and won’t fix the problem.

There certainly is a problem – a study by the University of California, Berkeley, found around 1% of websites contain pornographic material. With over a billion websites indexed by Google, this translates to around 10 million sites containing things you’d rather not be seen in your workplace or by your kids.

To deal with this problem, most computer operating systems, browsers and search engines have built-in adult filters, and the Federal Government provides free software for home computer users on its NetAlert website.

The new filter will go a number of steps further, with it being compulsory for internet providers to deny access to around 10,000 sites, a number that falls dramatically short of the 10 million estimated pornographic sites and who knows how many terrorist, gambling and euthanasia sites that will probably be added to the list.

The task of deciding which of the billion websites to be blacked out will fall upon the Classification Board. In 2005-6, their 65 staff considered 9425 movies, video games and websites. To say the board will require a massive injection of resources is an understatement.

Under the current proposals, the banned list would be secret, and it’s uncertain if your business inadvertently found itself on the list how an appeal mechanism would work.

One serious risk for business is that many of the people who post illegal and inappropriate material do so on others’ computers to avoid detection. Hacked personal computers and corporate servers are frequently used by criminal gangs for exactly this purpose.

There is also the risk of sites being blocked for political reasons. Canberra has form on this, with the Federal Police using spurious copyright reasons to close down Richard Neville’s spoof John Howard site in 2006.

Recently, a staffer of the present Federal Government indirectly pressured a prominent critic of the filtering proposal through his industry association.

So there are real risks to your website if someone in your company does something illegal, messes up a security setting, or simply upsets the wrong person in a minister’s office.

However it’s not the censorship aspects of filtering that should be the main concern for businesses. The indirect consequences will be deep and far reaching for Australian commerce.

The immediate effect is filtering will increase internet costs. Given 98% of businesses use the internet, the increased ISP charges will be a tax on almost every Australian enterprise.

Business relies upon fast, reliable communications. Trials to date of the filtering systems show a decrease of speed between 2% and 84%. The filters will also add another level of complexity to the system, which in turn reduces reliability.

Those additional costs will become another barrier to entry. At the very time the Federal Government is struggling with competition in the communications industry, this proposal will eliminate many smaller operators and favour the larger incumbent providers.

Overall, this proposal will add costs and reduce the reliability of one of the modern economy’s critical business tools. The real tragedy is the filters simply won’t work.

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