This week in Barcelona, the GSMA – the peak global standards body for the mobile phone industry – is hosting its annual industry trade event, the Mobile World Congress. The MWC is arguably the largest annual event in the telecommunications industry. It brings together carriers with mobile phone makers, equipment makers and app developers. It’s where handset manufacturers make the big pitch to mobile carriers for the year ahead. A strong presentation can bring your products to the attention of mobile carriers the world over. Perhaps more than the Consumer Electronics Show in January, the MWC is the big event where mobile phone makers unveil their new smartphones and other products for the year ahead. This year’s event certainly hasn’t underwhelmed, with major announcements from some of the industry’s biggest players. It’s time to take a look at eight of the biggest announcements from this year’s show: 1. Samsung Galaxy S5 Samsung is now easily the biggest handset maker in the industry. According to IDC, for the full year of 2013, it shipped a massive 313.9 million smartphones worldwide – that’s three out of every 10 smartphones shipped anywhere in the world. Forget about Apple versus Samsung, it’s not even a race anymore at this point. Apple shipped 153.4 million units in 2013, meaning that for every handset Apple shipped, Samsung shipped more than two. In fact, with the exception of the US and Japan, Apple is not even really competitive with Samsung anymore. That race was lost two years ago. In addition to manufacturing smartphones, it also supplies itself with almost every component, from batteries and processors to cameras, memory chips and displays. It is both the world’s second biggest chip builder, and the world’s second biggest ship builder. So when Samsung unveils its main, flagship smartphone for the year, you better believe that everyone in the industry – from carriers to competitors – is watching very closely. This year’s flagship, the Galaxy S5, was largely an incremental improvement on its predecessor, with the South Korean tech giant confirming speculation the new device is both dust-proof and waterproof. Needless to say, both Telstra and Optus have already announced they’re carrying the new smartphone. Aside from the Galaxy S5, Samsung shocked the industry when it snubbed Google for the latest version of its Galaxy Gear smartwatches. Instead of Android, the new devices will be powered by its own operating system, known as Tizen. 2. Microsoft’s Nokia X smartphones – powered by Android For nearly two decades, Microsoft’s Windows operating system had battled an open source rival, known as Linux. While Linux has struggled to make inroads in the desktop PC market, it has emerged as the dominant operating system for servers. Linux also forms the basis of Google Android, which competes head-to-head with Microsoft Windows Phone. Meanwhile, in September last year, Microsoft bought the mobile assets of Nokia, along with a licence to use its patents, for $US7.2 billion. In light of this, there was some scepticism when rumours first surfaced that Nokia was gearing up to release a series of smartphones powered by Android. At MWC, Nokia confirmed the rumours by unveiling a new smartphone product line powered by Android called the Nokia X series. The new devices will come with Microsoft’s cloud-based apps and services pre-installed and won’t come with the Google Play app store. Nonetheless, when Microsoft takes control of Nokia in April, it will be selling a consumer product based on Linux. Who would have thought it? 3. Facebook buys WhatsApp for $US16 billion A week before the MWC, Facebook announced it is taking over mobile messaging service WhatsApp for an incredible sum – $US16 billion. With both WhatsApp co-founder and chief executive Jan Koum and Facebook founder and chief executive Mark Zuckerberg delivering keynote speeches at MWC, the tech world was certainly going to pay attention. During the keynote, Koum did not disappoint, announcing WhatsApp was launching free voice calls through its app during the second quarter, once the takeover by Facebook has been completed. No doubt some of the mobile carriers were a little edgy about the prospect of Facebook launching an all-out assault on their lucrative voice call and text message businesses. 4. Mozilla unveils a $25 smartphone This year’s Mobile World Congress marked the one year anniversary of the debut of Mozilla’s smartphone platform, Firefox OS. For those unfamiliar with the platform, Mozilla is best known for its Firefox web browser. Last year, it announced it was creating a mobile operating system based on Firefox that would compete head-to-head with Google Android, Apple iOS, Windows Phone 8 and BlackBerry 10. In Firefox OS, all apps basically work like interactive websites and are coded in web standards, including HTML5 and CSS. Since this is less demanding than running a “full” operating system with apps, the theory went that Firefox OS would perform well on low-end devices aimed for emerging markets. In practice, some of the first Firefox OS smartphones, including the ZTE Open, have left a lot to be desired. As I explained in Control Shift last week, Mozilla’s expansion drive has left it in a precarious position in the marketplace: As if the situation weren’t already urgent enough already, Mozilla’s lucrative deal with Google expires in November of this year. In a sense, it’s fitting that [Mozilla founder Mitchell] Baker has taken up trapeze as a hobby, because Mozilla’s in the middle of a high-wire act. It might be that, over the coming months, one of Mozilla’s growing number of Firefox OS-driven side-projects gains traction in the market place. However, it could also backfire spectacularly, endangering its main source of revenue in the process. Aside from the seven new smartphones on display, Mozilla also announced that a smartphone costing just $25 would hit the market this year. Given that, up until the fourth quarter of last year, more than half of all mobile phones sold worldwide were still featurephones, mostly in emerging markets, the $25 phone might just be the big hit Mozilla’s looking for. Story continues on page 2. Please click below. 5. Major updates for BlackBerry enterprise customers BlackBerry chief executive John Chen’s bid to turn around the fortunes of the smartphone pioneer were filled out in a series of major product announcements at MWC. Up until now, enterprises using BlackBerry Secure Work Spaces on BYOD (bring your own device) smartphones needed to use different versions of BlackBerry Enterprise Service (BES) depending on whether staff used newer BlackBerry 10/Android/iOS devices, or older BlackBerrys. That has been cleared away with the release of BES 12, in the process clearing away many headaches for IT administrators. As an added bonus, it supports Windows Phone devices too. The company also unveiled a new flagship phone with a full keyboard called the Q20 and an enterprise version of its BlackBerry Messenger service called eBBM Suite. 6. At least Sony’s new products are water-tight Earlier this month, Sony announced it is selling its VAIO PC business to investment firm Japan Industrial Partners, spinning off its Bravia TV business into a separate subsidiary and slashing its global headcount by 5000 as part of a major restructure. At the time, the Japanese tech giant announced it’s setting its sights on the smartphone, tablet and wearables markets for its future growth. Suffice to say, the company is hoping it delivered a hit with the products it unveiled at MWC. The company unveiled a new flagship smartphone called the Xperia Z2, a 4G Android 4.4 KitKat smartphone powered by a 2.3 GHz quad-core Qualcomm processor. The company is proclaiming its 20.7-megapixel camera capable is the most ever used in a waterproof smartphone. Which I’m sure is fantastic news for scuba-diving photographers. The company also unveiled a 10.1-inch tablet called, imaginatively enough, the Z2 Tablet. The tablet is being marketed as the lightest ever used in a waterproof tablet. Finally, the company unveiled a smart wristband called the SmartBand. 7. Opportunity knocks for LG? The highlight for LG was an update of the KnockON security system called “Knock Code”, which uses a series of knocks rather than a password to secure a device. The new feature will appear on the LG G Pro 2 phablet, a new six-inch phablet set to go head-to-head with Samsung’s popular Galaxy Note devices. The company also unveiled its “L Series 3” range of low- to mid-range smartphones at the show. That said, most of LG’s big announcements came at the 2014 Consumer Electronics Show in Las Vegas in January, including its LG Lifeband Touch activity tracking bracelet, LG Heart Rate headphones, and webOS-powered smart TVs. 8. Tickets please! With the rapid growth of mobile ticketing, it’s no surprise the world’s largest telecommunications show would embrace NFC tickets. Telstra was one of a range of carriers to trial NFC badge technology for tickets to this year’s event. The badges use information stored by a mobile carrier, including name and telephone number, to help verify an attendee’s identity. The validation process also includes a photo ID check. This year’s show also features an NFC Experience demonstrating NFC-based mobile commerce systems for payment, retail, transport, mobile identity and ticketing/access. In addition, there are 61 NFC-enabled Tap-n-Go Points providing event news, schedules, documents, presentations, videos and other information. According to figures published by ABI research, in the next five years, 34 billion tickets to be sent to mobile devices,. In terms of technology used to authenticate tickets, the figures show 48% will rely on QR codes, near-field communications (NFC) will be used on 30%, while SMS or other technologies will be used on 22%. If the forecast is accurate, it suggests using our smartphones to touch on for events, public transport or entry into secure areas could soon be a part of everyday life.
Especially if you’re an inventive sort – not an unreasonable guess, given you’re reading StartupSmart – there can be a temptation to take two successful inventions and combine them. Now, there’s a place in this world for tools that do many things. Your humble correspondent always carries around a Swiss Army knife, for example. But, while convenient for those times you need a cross-head screwdriver in a hurry, your average Swiss Army knife makes neither a great magnifying glass, nor a great pair of scissors. Don’t get me wrong, there have been cases where combining two different inventions into one can be useful. After all, the smartphones in our pockets are basically PDAs with mobile phone capabilities tacked on. What sets smartphones apart is the combined functionality – being able to send data or make calls from PDA-style apps – fills a useful purpose. But, more often than not, combining two different inventions means you end up with a splayd, or worse, a Microsoft Surface! Seriously, what additional use case is filled by combining a laptop and a tablet that you couldn’t fill better with a proper laptop and a tablet? None! Now, earlier this week, Old Taskmaster was watching the Super Bowl while cheering on the winning team – capitalism – when an ad perfectly illustrating the point came on the TV: So are you toying with the idea of combining two different products into one? Before you do, think through about whether any additional benefits are gained by combining the two inventions. You don’t want to create a doberhuahua! Get it done – today!
The International Monetary Fund has warned the world’s central banks against raising interest rates too quickly, pointing out global economic growth was still weak. “Strengthening global growth does not mean that the global economy is out of the woods (and) countries including the US must not respond to the prospect of rising growth by prematurely withdrawing monetary policy accommodation,” The Australian reports the IMF saying. The IMF also pointed to “fragile” improvements in southern Europe and imbalances inside China. Telstra caps mobile phone call costs Telstra is capping the amount of money many customers pay for mobile phone calls, The Australian Financial Review reports. It says Telstra is the last of the three big telecommunications companies to make the change. Telstra now charges a maximum $130 a month for customers on new contracts, regardless of how many calls are made. “The most customers will pay for excess calls to standard Australian numbers is $70,” a Telstra spokesman said. ACCC probes beer supply to pubs for anti-competitive conduct Australia’s competition watchdog is investigating the supply of beer to Australia’s pubs to discover whether brewers are using tactics to lock out rival brands. The Age reports the Australian Competition and Consumer Commission has written to brewers seeking a better “understanding” of the market to assess whether anti-competitive conduct was happening. ''The ACCC is making some inquiries to better understand the supply conditions within the wholesale draught beer market in Australia, and to understand how certain conduct may be affecting competition,'' the commission said in the letter. Markets The Dow Jones Industrial Average is down 0.27% at 16,414.44 points and the Australian dollar is buying US88.1 cents.
Are you thinking about developing an Android or iPhone app? Perhaps you have already established a business and remain a mobile sceptic? Or maybe you are looking for a good business idea? If so, it’s time to take some inspiration from one of the world’s pre-eminent experts on mobile, Tomi Ahonen. Who’s this Tomi Ahonen character, you ask? He was a senior executive at Nokia back in the ‘90s, the good ‘ole days when the Finnish mobile phone giant dominated the planet. Since leaving the company, Ahonen has become an outspoken critic of the now-former Nokia chief executive, Stephen Elop, and the company’s recent Windows Phone 8-powered smartphones. If you carried a Nokia 3210 in your pocket back in the late ‘90s, it was partly due to forward thinking Finnish engineers and executives like Ahonen. Amongst many other achievements, he oversaw Nokia’s 3G Research Centre and wrote the first industry white paper on bringing internet services to mobile. Back in the golden age known as the late ‘90s, Ahonen foresaw that online services on mobile would be used in a fundamentally different manner to how it is on a desktop computer. It’s a theme he discusses in greater depth in his book The Seventh Mass Media, which argues mobile is the seventh and most recent of a series of fundamentally different media forms, following print, recordings, cinema, radio, television and the internet. See, these days, Sonny Jim Crockett, it’s common sense to assume that your desktop website will work differently to a well-designed mobile site. Not so, back in the ancient days of the internet. Heck, right up until recently, Microsoft’s Steve Ballmer was still insisting mobile devices were just PCs in a different form! But that’s another story! Anyway, during the video, Ahonen lists nine unique benefits of mobile. They are: 1. It’s the first personal media form. 2. It’s (almost) permanently connected. 3. It’s always carried. 4. It has a built-in billing system. 6. It has the most accurate audience info of any media. 7. It captures the social context of consumption. 8. It enables the eight mass media: Augmented reality. 9. It’s a digital interface to the real world. What implications do these nine unique benefits have if you own or are about to start a business? How should you optimise your business for mobile communications? And why does mobile matter for business in the first place? All is revealed in this video. Your task for today is simple. Watch it: Get it done – today!
So you’ve ditched the job you hate or put your hand up for redundancy and you’ve decided you’re going to be your own boss in 2014. Congratulations. It’s a big step and not one to be taken lightly. The bad news is that the percentage of small businesses collapsing is on the rise, according to ASIC figures. How can you ensure you’re not one of the 44 businesses closing their doors in Australia every day? Below are five tips to ensure you focus on the right things in the early days. 1. Don’t sweat the small stuff It’s easy to spend too much time thinking about a name and logo for your business. Similarly, money can be poured into cool looking websites and fancy business cards. This is a waste of your precious time and money when setting up a business. Even if you’re in an ‘image conscious’ industry like ours (PR), it really doesn’t matter as much as you think it does. Of course if you’re going to be selling products online you need to invest in your website, but otherwise, get a basic one set up so people can find you online. This is very important – choose functionality over how it looks. A website isn’t something you can set up and forget, we’ve had four different websites in five years as we’ve grown out of each one, but in the set-up phase choose a basic one and concentrate on getting money through the door. 2. Spread your risk Many businesses start with a customer the founder may have worked with before. It’s important to use your contacts and industry knowledge as much as possible. That first customer is very important as they provide you with a potential reference for future work. However, be careful not to rely on one customer – this is a very risky strategy. If you only work for one customer, you haven’t really established a business; you’ve bought yourself a job. Of course you have a little more control than you would if you were employed by someone else, but ultimately this is all you’ve got. So you need to find time to do some business development and quickly. 3. Start selling You can spend so much time developing business plans, marketing strategies, attending various events and reading all of the excellent online resources that are available to small businesses today, but ultimately you need to start selling. Your family and friends may have told you your product is great and they will have every faith in your skills and business idea, but you need to start making money. This could involve contacting prospective companies, launching a google ad campaign or attending relevant events. You need to be able to explain what you do concisely and sell your business and the services you offer. The more practice you get at this the better. 4. Know your numbers Maths might not have been your favourite subject at school, but you’re going to have to understand what revenue is coming in, what costs are going out and how to read a profit and loss statement. Cash flow (along with bad management) is still the main reason why so many businesses fail in Australia. On average it takes a small business 55 days to get paid in Australia. Don’t wait until the end of the year, or even the end of the quarter for your accountant to tell you how your business is performing financially. There are some excellent cloud based accounting packages which can tell you in real time just how financially healthy your business is. You can also send and reconcile invoices from your mobile phone and send customers online payment options, making it easier for you to invoice and easier for customers to pay. 5. Do what you do best, outsource the rest In the first 12 months it’s important for you to understand every facet of your business. This will make it easier to outsource and delegate tasks in future, but you can’t do everything. Business owners can struggle with this, they do have ‘control freak’ tendencies, believe me I know, but you have to do it to grow your business. The early days of setting up a business are the hardest, but they can also be the most rewarding. Jocelyn Hunter is the managing director of Bench PR.
The tech sector has always been hyper-competitive, and never has this been truer than in 2013. For the likes of Twitter, Samsung and Google, the harvest of 2013 was bountiful. However, from the perspective of Nokia, Microsoft, BlackBerry or the PC industry, it was a year to forget. Here’s a look back at 10 of the big events and trends that shaped the tech sector in 2013. 1. One billion smartphones sold this year – and counting The most important tech story of 2013 didn’t take place with a major product announcement or a Steve Jobs-style keynote speech. Instead, it took place without fanfare at an ordinary mobile phone retailer somewhere deep in suburbia. It was there that a consumer decided to purchase the one billionth smartphone to be sold during 2013. To put that number in perspective, it is projected that 227.3 million tablets shipped worldwide during 2013, 158 million television sets, 180.9 million portable PCs and 134.4 million desktop PCs. Meanwhile, figures from market analysts IDC show smartphones also outsold featurephones worldwide for the first time in history during the first quarter of 2013. What this means is that while smartphones now account for more than half of the 418.6 million mobile phones shipped worldwide each quarter, there are still millions of old-fashioned featurephones being sold each year. Especially in the low-end of the market and in emerging economies, that means there’s plenty of extra room for growth in the future – especially at the low-end of the market. Make no mistake about it. The smartphone industry is big – far bigger than the PC or TV business. And it’s only going to get bigger in 2014. 2. Google Android and Samsung: The juggernaut rolls on The biggest winners from the spectacular, ongoing growth of the smartphone market have been Samsung and Google. Last year, smartphones running Google Android outsold Apple. In 2013, that trend morphed into total industry domination. For example, of the 261.1 million smartphones shipped worldwide during the third quarter of 2013, 211.6 million or over 80% ran Google’s Android operating system. That compares to just 33.8 million iPhones, representing around 12.9% of the market, and a measly 3.6% for Windows Phone. Samsung managed to ship 72.4 million smartphones during the second quarter of 2013 alone, representing around 30.4% of the market – more than double Apple’s sales during the same period. Those device sales also mean increased component orders flowing through the various divisions of the South Korean tech conglomerate, which manufactures everything from semiconductors to batteries and smartphone displays. The growing strength of the South Korean electronics behemoth is demonstrated by its advertising and marketing budget, which has been estimated at around $US14 billion worldwide. To put that figure into perspective, as of 2011, North Korea’s entire national economy was estimated to stand at $US12.385 billion. 3. The PC industry bloodbath While Google and Samsung have had a stellar year in 2013, the same certainly can’t be said for the PC industry. The September quarter was the sixth consecutive quarter of falls, according to Gartner, with shipments falling to 80.2 million units for the quarter from 87.8 million a year earlier. Figures released by IDC forecast PC shipments for the full year to fall 9.7% in 2013. More alarmingly, it appears the emerging middle class in China, India and Brazil aren’t keen on buying computers, with total PC shipments in emerging markets expected to drop from 205.2 million to 185 million this year. Australia and New Zealand led the trend, with a massive 21% year-on-year fall in shipments for first quarter in Australia, along with a more astounding 27% fall in New Zealand. The implosion of the PC market was disastrous for a number of PC makers, including Dell, HP and Acer. In August, HP announced a major shake-up of its senior management team after announcing a large 15% year-on-year drop in net earnings and a 22% drop in revenue from consumer devices during its quarterly results. That same month, Dell reported a massive 72% year-on-year collapse in quarterly earnings, while a consortium including founder Michael Dell, Silver Lake Capital and Microsoft successfully fought off high-profile investor Carl Icahn’s bid for control of the company. And at Acer, founder Stan Shih made a surprise return as interim chairman and president, following the resignation of former chief executive JT Wang and president Jim Wong after the company recorded a record third-quarter loss. The resignations came after Acer announced its consolidated revenues for the third-quarter of 2013 fell 11.8% year-on-year to $US3.11 billion, resulting in an operating loss of $US86.6 million. 4. Surface falls flat On top of falling PC sales and 3.6% Windows Phone market share, the news was dire for Microsoft on another front in 2013. Late last year, Microsoft launched its Surface series of tablets as a first step towards making devices, with the company believed to have manufactured around six million units. The release of the Surface instantly made Microsoft a direct competitor to many of its already struggling PC partners, straining relations in the process. Fast forward to July of this year when Microsoft announced a massive $US900 million writedown on its inventory of unsold tablets. The writedown came less than a week after Microsoft announced a large price cut of $US150 for the struggling product line. Adding insult to injury, Microsoft also revealed it has spent $US898 million advertising the tablets, while only generating $US853 million in sales. According to many leading analysts, the company was believed to have sold just 1.7 million of the six million tablets it had built. To put those numbers in perspective, Apple sells around 14.6 million iPads each quarter, while Samsung sells around 8.8 million. 5. Steve Ballmer resigns During the 1990s, Microsoft was undeniably the 800-pound gorilla of the tech industry. Then, in January 2000, founder Bill Gates stood aside as chief executive, in favour of Steve Ballmer, in order to focus on his philanthropic efforts. Since then, the company has lost much of its former dynamism, and has failed to become the dominant player in a range of new technologies that have emerged since then, including search, tablets, smartphones or social media. In August last year, Vanity Fair magazine journalist Kurt Eichenwald ran a feature exploring why Microsoft fell behind its rivals. A management technique called stack ranking was almost universally blamed. “If you were on a team of 10 people, you walked in the first day knowing that, no matter how good everyone was, two people were going to get a great review, seven were going to get mediocre reviews, and one was going to get a terrible review,” a former software developer told Eichenwald. “It leads to employees focusing on competing with each other rather than competing with other companies.” Add the low market share for Windows Phone, poor sales of the Surface and the PC industry bloodbath, and it became clear something had to give at Microsoft. In July, the company announced a major management restructure, with the company’s strategy shifting to focus on “devices and services”. Then, just one month later, Ballmer resigned as chief executive, with stack ranking dumped as a management technique soon after. The Redmond, Washington-based tech giant is currently searching for his replacement. Story continues on page 2. Please click below. 6. Nokia sold for a song Soon after Ballmer’s resignation, the news was overshadowed by an even bigger story. In September, Microsoft announced it was buying Nokia’s smartphone and devices businesses for $US7.2 billion, with the Finnish telecommunications company retaining its Nokia-Siemens services network equipment business and the Nokia brand name. The deal came after Nokia announced its smartphone sales had slumped 27% year-on-year during the second quarter of 2013, with an overall loss of €115 million ($A190 million) for the quarter. The sales plunge was led by the company’s Windows Phone-based Lumia smartphone unit, where shipments fell 27% from 10.2 million units during the second quarter of 2012 to just 7.4 million for the same quarter in 2013. To put that number into perspective, it was a little over one-tenth the number of smartphones sold by Samsung during the same quarter. It was an inglorious end to a company that absolutely dominated the mobile industry through the 1990s and 2000s. As recently as 2010, when Apple sold 47 million smartphones, Nokia managed to sell 104 million. According to prominent industry analysts, such as former Nokia executive Tomi Ahonen, the fateful moment came in February 2011, when then chief executive Stephen Elop made the decision to switch its smartphones to the Windows Phone operating system. Soon after, a leaked internal letter from Elop known as the “burning platform” memo likened the company’s situation in the mobile phone market to a person standing on a burning oil platform. After the takeover was announced, Elop was named as one of the top contenders for the position of Microsoft chief executive. 7. BlackBerry’s failed comeback and takeover attempt It wasn’t just Nokia that had a tough time in the smartphone market at the hands of Samsung and Google. In January, BlackBerry launched its new, all-touch BlackBerry 10 smartphone operating system. The platform, originally scheduled for late 2011, had been delayed by a year, preventing the company launching a flagship phone in 2012. The Australian launch for the first smartphone to run the new platform, the Z10, came in March at a gala event in Sydney hosted by Adam Spencer. A second device using a traditional BlackBerry keyboard, called the Q10, came soon after. While the reviews were generally positive, the new devices failed to be the big comeback success the company’s then-chief executive, Thorsten Heins, had hoped for. By August, the company formed a special five-member panel to examine takeover options after director and Canadian investment guru Prem Watsa quit the board. In its September quarter results, the full carnage was laid bare. The Canadian smartphone maker reported just $US1.6 billion in revenues for the quarter, down 45% year-on-year and 49% quarter-on-quarter. The company also revealed it sold just 3.7 million smartphones for the quarter – and less than half of those ran BlackBerry 10. Total losses came in at $US965 million, including a massive $US934 million inventory writedown against unsold stock of the company’s Z10 smartphone. The company announced more than 4500 staff layoffs, representing nearly 40% of its global workforce, while Heins bought a new private jet. Meanwhile, the company’s rollout of its Messenger app for Android and iOS was frozen due to technical issues with its release. In early November, with banks uncertain of the company’s long-term future, Watsa failed to raise the requisite $4.7 billion for a buyout, instead lending the company $US1 billion. As part of the deal, Heins stood aside as chief executive, replaced by former Sybase chief executive John Chen, with Watsa rejoining the board. Heins received a $US22 million golden parachute for his efforts, significantly less than the $US55.6 million he would have received had the sale gone through. 8. The Twitter IPO Last year, Facebook’s disastrous IPO ended in tears – followed by lawsuits. Thankfully, the outcome was not repeated when its social media rival, Twitter, listed on the New York Stock Exchange in November. After opening at $US26 per share, the company’s share price surged 72.69% in its first trading session. It closed at $US44.90 per share, before dropping slightly to $US44.44 in after-hours trading. Making the result even more amazing was the state of its balance sheet. While the tech giant has revenues of $US534.46 million and around 230 million users worldwide, it has never posted a profit. Despite this, the company now has a market capitalisation north of $US20 billion, with chief executive Dick Costolo claiming the company’s long-term investment strategy has prevented it from chasing profits in the short term. 9. iOS7, iPhones and iPads For Apple, 2013 was a solid if somewhat unspectacular year. In June, the company released a redesigned version of its smartphone and mobile operating system, iOS7, alongside a new version of its Mac OS X desktop operating system, known as Mavericks. It was the year that Apple finally unveiled a low-cost version of its iPhone, known as the iPhone 5c, alongside a new 64-bit flagship smartphone called the iPhone 5s, complete with a 64-bit processor and a fingerprint sensor. Then, in October, the company unveiled a lighter version of its iPad, known as the iPad Air. None of the products had the industry-shaking impact of the unveiling of the Macintosh, iPod, iPhone or iPad. That said, with billions in profits each quarter, a solid second place in the smartphone market and the world’s biggest selling tablet, solid and unspectacular for Apple is better than most companies could dream of. 10. Xbox One and PlayStation 4 launch Last, but certainly not least for gamers, 2013 marked the introduction of next generation games consoles from both Sony and Microsoft. Coming a year after Nintendo launched its Wii U system, Sony announced one million first-day sales of its PlayStation 4 system, but the launch was marred by a number of angry consumers taking to social media to complain about non-functional systems. Sony’s first-day sales were soon matched by the first-day sales of Microsoft’s new Xbox One system. So how will the two new devices perform over the long term? We’ll have to wait until next year to find out! This story first appeared on SmartCompany.
As Taskmaster readers will know, earlier this week your humble correspondent went for a sales meeting at a busy suburban shopping centre. After visiting one customer, Old Taskmaster trundled through the now narrow corridors to a second store. Slowly. The once wide corridors have been narrowed down by a series of mobile phone store kiosks, meaning a single elderly gentleman with a walking stick and five-year-old granddaughter in tow can now single-handedly slow a whole row of shoppers to a crawl. Seriously, centre management, it might boost revenue per square metre, but it’s a practice that really annoys your shoppers! Anyway, the second sales call was a franchisee of a national chain. During a discussion about the newest widget models from Taskmaster Enterprises, they revealed their biggest business regret. Apparently, part of their franchise agreement states that they have an exclusive ‘territory’ in terms of the location of physical stores. Unfortunately for them, any revenues from sales through the chain’s website or its mobile app go to the franchisor, even if the customer is within the same suburb as an existing store. So if a customer visits their local store on Sunday, looks at an item, and then goes home before ordering it online a couple of days later, the value of that sale goes entirely to the franchisor. As you might imagine, this creates all manner of perverse incentives. For example, the franchisee views the website as a competitor with the same merchandise rather than an asset for their business. Why encourage your loyal customers to purchase their goods from a competitor? As a result, since the company’s Twitter and Facebook accounts are geared to get people to buy online rather than in store, what incentive is there for the sales staff to promote them? As a result, Old Taskmaster was amused to note the sales staff consistently “forget” to ask the customers to follow the chain on Twitter and Facebook – even when the owner or manager is within earshot. The franchisee’s big regret with all of this is to fail to ask the question of how online sales revenues (or profits) are distributed. After all, who wants a franchisor who feels like a rival rather than a partner? Well, Old Taskmaster says this: If you’re looking to become a franchisee, make sure you ask about how online revenues are distributed. It’s always better to ask ahead of time than to find yourself in a business dispute. As for franchisors, be aware that the way you treat your online sales and web presence can create perverse incentives for your franchisees. If a sale can be traced to near a physical franchisee’s store, consider some sort of profit sharing agreement with your franchisees. Get it done – today.
Business: Ninja Blocks Age: 25 State: New South Wales Creating a world of connected home devices able to be controlled and monitored through the internet is the goal of Ninja Blocks chief executive Daniel Friedman. Friedman took on the senior executive role earlier this year after joining the company as chief technology officer last year. “This whole space of connected devices is going to explode,” he predicts. “We’d just like to have a part of the conversation on how they should interact.” Ninja Blocks are small, cloud-enabled computers that can sense their environment by receiving input from a variety of sensors and can influence their surroundings by controlling items such as lights, power sockets, air-conditioning and music centres. They operate on an open platform that allows developers to create their own applications for devices. Friedman says Ninja Blocks enables people to connect almost anything to the internet. He says one of their uses includes creating a cheap security system for the home. Motion detectors can turn on lights if movement is detected while the home owner is out, and turn on a camera to record and send the images to their Dropbox. Ninja Blocks was founded by husband and wife Marcus and Madeline Schappi, and Peter Moore. Last year the company secured $1 million from a range of angel investors in the US after taking part in the Startmate seed funding and mentorship program. Also last year Ninja Blocks launched a Kickstarter crowdfunding campaign to manufacture the device and smashed its $24,000 target in just one weekend. The campaign eventually raised more than $102,000. Friedman says the company is preparing to launch its next generation Ninja Block, which will include new features that focus on ways to control devices other than with your mobile phone. He says moving into the chief executive role has been a “large learning curve”. “It’s a different sort of responsibility,” he says of the role, which includes making sure business processes are efficient, speaking to stakeholders, making sure investors’ interests are being considered and the company is on the right path.
I’m working from home and am quite overwhelmed by the amount of stuff that I have to handle. However, I’m reluctant to outsource anything, as I like being in control. Do I just need to get over this attitude? Every business must learn to rely upon the strengths of its supply chain, the support of family and friends, the quality of staff and a network of outsourced resources. This enables the business to thrive. Notwithstanding this reality, you still need to enjoy being in charge and staying on top of your game. There is nothing wrong with being a control freak when it comes to handling your home-based business provided that you are really in control and the business is not in the driver's seat. Claire Heaney, in 101 Ways to Kickstart Your Business, says: "Often the head of the business has invested his or her heart and soul in the business — It is more than money.” “Their whole identity and status is tied up in the business. Everything from being the boss to having the prime car spot and being respected by the staff and because too often they have spent every waking moment in the business they have no other interests. They fear taking a back seat." Yes, it is vital to learn how to let go, identify your own strengths and outsource against weaknesses after you have completed a thorough SWOT Analysis. (Have a look at p.26-28 of my book No Workplace Like Home) You can maintain your sense of control by outsourcing many of the routine elements of your business. Find local secretarial services that can assist with the urgent mail-outs or engage an answering service that sends a text message to your mobile phone when a customer leaves a message. This frees you to convert your sense of control into a capacity to convert customers into an effective sales force for your business. You need to engage consultants to assist with business plan development and to extend your span of control by finding new market opportunities and challenge the tendency to talk yourself into a more of the same mentality. The real key to successful outsourcing is to consider it as testing out the potential for taking on new customers and new employees as the business expands so that you can curb over-enthusiasm that can leave you stressed and overworked. At the end of the day it comes down to establishing priorities amongst all that stuff that you have to handle. Priorities Make four piles: The things that maintain your sense of commitment and enthusiasm for your thriving business; Customer services requirements that maintain cash flow and need constant attention like accounts receivable and inventory control that can be delegated to full or part-time staff; Stuff that can be outsourced under clear work contracts that require minimal supervision and; Things that should have been abandoned long ago to give you back a sense of control over your life. That way you cease being overwhelmed by the range and variety of demands generated by a growing business and it will give you back the thrill and the challenge of being your own boss. You need to see outsourcing as a way for you discover innovative solutions and make sure that your business stays at the forefront of creative endeavours.
Yesterday, your humble correspondent looked at four key trends in the smartphone industry that every mobile app developer should be aware of. While the figures can be dry, the information is critical, whether you’re planning your start-up or looking for big numbers when you are strategising your future direction. Likewise, coming up with a few hard numbers can be useful if you’re pitching for capital. So, without further ado, here are four more essential trends emerging from the mobile sector: 1. Android dominates over Apple in most other major markets – except Japan Okay, so Android is strong in the US and Australia, but what about the rest of the world? In terms of market share the most competitive major market against Android is Japan. In Japan, Apple claims 47.4% of the market, compared to Android only a notch higher at 48.6%. Across Europe, the story is very different, with Apple claiming 27.5% market share in the UK, compared to Android’s 56.3%. The situation is worse elsewhere in Europe, with Apple trailing 17.5% to 63.3% in France, 14.4% to 71.6% in Italy, 9.5% to 78.7% in Germany and claiming just 2.2% to 90.8% in Spain. As for China, Android’s market share is now at 72.4%, compared to a respectable 20.8% for Apple. And there are a few very good reasons why you should pay attention to China when it comes to mobiles. 2. The world’s biggest smartphone market is China – and it’s huge! Australia’s population stands somewhere around 23 million. The total population of the US is around 310 million. This year, IDC anticipates China’s smartphone market will hit 360 million people. And that’s not including all the people still using older feature phones. Next year, it is projected to hit around 450 million, including around 120 million users on 4G. Now here’s an astounding statistic. The worldwide smartphone market reached 216.2 million units during the first quarter of 2013 according to IDC figures, while China’s shipments stood at 75.28 million. That means China accounted for around one-third (34.8%) of the worldwide market for smartphones. And there’s still a lot more room for growth. The largest carrier in China – China Mobile – is estimated to have around 700 million mobile phone subscribers, including both smartphones and older phones. Kinda makes Australia and New Zealand’s 2.6 million mobile phones per quarter look pathetic in comparison, doesn’t it? 3. Mobile apps are now a multi-billion dollar industry – and growing If you thought China’s mobile market had some big numbers, take a look at the size of the worldwide app industry. According to Gartner, last year there were 63 billion apps downloaded worldwide, including 57.3 billion free apps and 6.6 billion paid apps. Total revenue from apps hit a massive $US18 billion. If you keep in mind that the total population of the Earth is estimated as being somewhere between 6 billion and 7 billion, a number like 6.6 billion paid app downloads starts sounding quite astounding – let alone 63 billion total downloads. This year is on track to be even bigger. Worldwide, we’re on track for a total of 102 billion app downloads, with 92.8 billion free apps downloaded and 9.9 billion paid apps. Gartner predicts those numbers are only going to get bigger. In the year 2017, they anticipate a total of 268 billion apps will be downloaded. That’s right, two hundred and sixty-eight billion apps. Of those, 253 billion will be free and 14 billion will be paid. 4. Most Android users now use a recent version One of the issues when it comes to developing for Android is how much you support legacy versions. Well, the answer is increasingly clear: Don’t bother! According to Google, 48.6% of all devices running Android are now powered by JellyBean (that’s Android 4.1/4.2/4.3). A further 20.6% run the previous version, 4.0 Ice Cream Sandwich, with 69.2% in total running a recent version of Android. Meanwhile 0.1% of the Android user base is hanging on to 1.6 Donut, 2.1 Eclair or 3.0 Honeycomb. The only old versions to have significant user bases anymore are 2.2 Froyo with 2.2%, and 2.3 Gingerbread on 28.5%. So sure, as far as Android fragmentation exists, much of it is over obsolete versions no-one uses anymore. Time to cash in! The global appetite for apps is huge – and growing. And contrary to popular myth, most of it isn’t in countries where English is the first language. Now, are you going to let this opportunity pass you by? Or are you going to cash in? Get it done – on mobile! Click here to read part one.
Apple Inc’s attempts to trademark ‘startup’ in Australia could face a stumbling block if it fails to address objections raised in a report by the trademark authority from the company’s first bid to secure the word. StartupSmart has obtained the report by IP Australia, dated July 1 this year, which outlines objections to Apple’s application on two grounds: that it doesn’t distinguish its goods and services from others; and is similar to other trademarks using ‘startup’, including StartupSmart. Apple’s first application in 2011, numbered 1436263, has lapsed. In late August the technology giant filed another application to trademark ‘startup’, numbered 1576935. IP Australia examiner Wendy Macpherson wrote in a report to Apple’s law firm, Baker & McKenzie, in relation to the first application that, after considering their submissions, she was maintaining the two grounds for rejection of the application. She points out that the term ‘startup’ is “commonly used computer terminology referring to the first action when using a computer, mobile phone or electronic device” and that other traders are using the word to describe their software and to describe an aspect of their computers, mobile phone and “peripherals”. “As such, this term should be available for all traders to use, as they would be unfairly disadvantaged if one trader were granted a monopoly on the term ‘startup’,” she says, in relation to the retail of ‘startup’ goods such as software and the maintenance and installation of those goods. Macpherson also said that educational service providers may want to use ‘startup’ to refer to a beginners’ course in, for example, yoga, music or dancing, or a course in starting a business. “The combination of ‘start’ and ‘up’ in relation to computers, devices and educational services is very common. ‘Startup’ is clearly a descriptive term, with several meanings which relate directly to the services claimed by your client,” she wrote. Macpherson also notes that ‘startup’ is already a feature of existing trademarks Start Up City and StartupSmart in Australia, and that Apple’s claim overlaps with classes of goods and services those trademarks cover. She adds that while ‘startup’ and ‘startup city’ trademarks exist on the US Register, “without evidence of the use of the trademark in Australia, I am unable to accept your client’s trademark on the basis of acceptance in another jurisdiction”. Macpherson also says adding the word ‘smart’ to the StartupSmart trademark was “insufficient” to differentiate it from ‘startup’. “The two trademarks are not substantially identical but deceptively similar,” she says. IP Australia’s decision on the current trademark application will be published in mid-November.
When it comes to smartphones, there’s a whole heap of jargon. Quad-core processors? AMOLED displays? Android or iOS? If you’re not a techie, it can be tough to make sense of it all. So here’s a layman’s guide to some of the mobile mumbo jumbo you’ve always wondered about, but been too afraid to ask. (Before we get started a note to the techie uber-geeks reading this. Old Taskmaster is completely aware some of these points are gross oversimplifications, that your early-90s BeBox had more than one processor or that I didn’t bother to mention MeeGo. No need for snarky comments. This is intended as a layman’s guide, so sue me!) What exactly do iOS, Android and Windows Phone do? A good, simple way of thinking about your mobile phone is as a pocket-sized computer that can also make calls. On most computers, there’s a piece of system software, called an operating system that basically manages the relationship between a computer’s hardware and the programs that run on it. In the computer world, most PCs use Windows or Linux, while Apple Macs use Mac OSX. Operating systems like iOS, Android and Windows Phone basically do the same thing, except they’re designed to work on a smartphone. If you run an iPhone, you run Apple’s iOS. If you run a recent Nokia, it almost certainly uses Windows Phone. Pretty much everything else – most notably Samsung Galaxy smartphones – use Android. So why do Androids come in Cupcake, Ice Cream Sandwich or JellyBean? Each major version of Android is code-named after a dessert. The first letter of each dessert goes up in alphabetical order. So you’ve had Android Cupcake, Donut, Éclair, Froyo, Gingerbread, Honeycomb, Ice Cream Sandwich and Jellybean. Why? Basically, because Google thinks ‘Android Gingerbread’ sounds cuter than ‘Android Build G’. What are the most recent versions of the major smartphone operating systems? The current version of Android is 4.2/4.3 Jellybean, although Google has announced Android 4.4 KitKat is coming soon. As fairly well publicised by their recent announcement, the latest version of Apple’s iOS is iOS 7. Windows is up to Windows Phone 8, although 8.1 is just around the corner. Finally, BlackBerry is up to BlackBerry 10.2. Given their current business status, Old Taskmaster wouldn’t bet on 10.3. LCD or AMOLED? LCD (of various descriptions) and AMOLED are the two common technologies you’ll find powering smartphone screens. An LCD (liquid crystal display) display is made up of thousands of tiny liquid crystals that modulate light to achieve a desired colour. The light itself is either provided through backlights or through a reflective back panel on the display. AMOLED (active-matrix organic light-emitting diode) displays are made of a thin film of organic material that lights up when charged by an electric current. The charge that makes different parts of the screen light up is provided by a thin-film transistor that sits behind the organic material. Which is better? LCD is the more mature technology of the two. Generally speaking, LCD will be clearer at different viewing angles and produce more realistic colours, but is less good at contrast. AMOLED colours are brighter, have better contrast and (because they don’t need to be backlit) generally use less power. Traditionally, they are less viewable in direct sunlight. What’s this resolution business? Whether your display is LCD or AMOLED, the number of pixels or dots of colour per square inch of screen size determine how clear your image is. In the past, Windows PCs used 96 points per inch, while Apple Macs used 72. The usual standard for the printing industry is 300 dots per inch. By comparison, Samsung’s Galaxy S4 displays 441 pixels per inch. Dual-core? Quad-core? Octo-core? What-the-core? Historically, most computers were built around a single processor – called the CPU (central processing unit) – that computer programs ran on. One processor core, one chip, one computer. These days, most smartphones have more than one of these processor cores on a single physical computer chip, and these are known as multi-core processors. In effect, it’s like having two or four computer CPUs on your phone, except they’ve been shrunk down to fit on a single piece of silicon. Most current smartphones use a quad-core processor, although some older ones use a dual-core processor, while octo-core processors are beginning to be offered on some newer models. How is the processor in my smartphone different to the one in my computer? If you open up your PC or Mac, you’ll probably find it’s built around an Intel processor. The ancestor of this chip was the 8088 and 8086 chips in the very first IBM PCs. Over the past couple of decades, the design of these chips has been optimised for maximise performance, often at the expense of using more power. In contrast, the processor in your smartphone is most likely an ARM chip. Its great ancestor first appeared in a 1985 accelerator card add-on for the BBC Micro B. (Yes, the BBC Micro B is a distant relative of your smartphone!) Acorn’s Archimedes and Apple’s Newtons used this series of chips, too. Because they’ve spent most of the past 20 years being used in mobile devices, they’ve been optimised for battery life as well as performance. But my smartphone processor is built by Qualcomm/Nvidia/Samsung? ARM comes up with the basic designs for its processors. It then licenses them to a range of other chip companies, including Qualcomm, Nvidia, Samsung and Apple. In turn, these companies don’t usually make chips, they just market them. The chips themselves are manufactured by companies with chip manufacturing plants (foundries), including TSMC and Samsung. SNS integration? It stands for Social Network Service. It’s a fancy, jargony way of saying this phone has an app or hub that pulls your social media messages into one place. Over to you Are there any other bits of smartphone jargon you’ve heard but have been too afraid to ask about? If so, leave your question in the comments below! Mobile and mobile commerce is an increasingly critical part of every business. If there’s some piece of mobile mumbo jumbo you don’t understand, make sure you get it cleared up! Get it done – today!
Australian start-ups are increasingly attractive to international investors as the technology and start-up sector evolves, especially if they’re leveraging their geographical location and have solid plans to go global, says internationally renowned venture capital investor Bill Tai. Tai is in Australia as part of the OzAPP roadshow, giving a series of talks about big data and entrepreneurialism around the country. He told StartupSmart it mattered less and less where tech start-ups were based. “In the past, it wasn’t really viable to have start-ups that were competitive with those in the USA because the kind of start-ups that are happening generally speaking today are different,” Tai says. The first few overlapping waves of start-ups (from the late 70s to the early 90s, and the late 80s the late 90s) usually required more than $50 million in start-up funding and required larger teams of specialised skills. “These waves laid the foundation for the kind of start-ups that are possible now, because now everything start-up is essentially a user interface (UI) for data from the cloud. So LinkedIn, Facebook, Twitter, they’re just UIs. And you can start UI companies anywhere,” Tai says. “So now the big question is can you scale it into a big company or not.” Two of Tai’s Australian investments have been design software Canva and customisable online fashion site Shoes of Prey. Tai says both jumped out as unique, well-timed ideas with global potential. “Because the market here is small, the start-up companies that succeed will have to be players in the broader English language markets,” he says. “Shoes of Prey was amazing because the people were fantastic and had a good heritage as they had been very successful at what they had done in the past and had a very unique business model at the time and proof that they could execute because they had already developed revenue without any venture money,” Tai says, adding Shoes of Prey had a competitive advantage over US-based start-ups with similar ideas given Australia’s proximity to China. “Shoes of Prey is in a geographic position to leverage heavy manufacturing assets in China on the same timezone. If you tried to execute the same business in the USA, and had your team having to work in the middle of night, it’s just not workable so they had a natural competitive advantage,” Tai says. Tai says his questions for Shoes of Prey before signing the cheque were about how much venture capital they would need to scale to a point where they would become self-sufficient. Tai says both Shoes of Prey and Canva stood out because both founder teams had business experience. “I’ve funded many, many extraordinarily smart entrepreneurs in the United States with basically valuable outcomes that have never made a penny before, but these two had built a business and knew what it meant,” Tai says. He adds the educational system, well developed gross domestic product, a high standard of living, and mobile phone penetration means Australia is a good test market for software and tech start-ups. “There is proof you can scale companies from Australia, such as Atlassian, which is a world-class leader in its space but started here,” Tai says. “Now we’re in a world where if the cloud infrastructure really becomes commoditised, then it really is possible for Australian start-ups.” Given the need for Australian start-ups to go global from day one, Tai says aspiring founders should stop wasting their time not going for big markets. “It takes the same amount of time to build an app for five family members as it does to build one that will serve a billion people,” Tai says. “Because if it works you’ll have a shot at a really big outcome rather than a huge success in a small market, so I’d encourage Australian start-ups to think big.”
When it comes to business advice, embattled smartphone maker BlackBerry is like the Kevin Rudd of smartphones: study it closely and then do the opposite. Their latest fiasco? This past weekend, the company was going to launch a version of its BlackBerry Messenger app for Android and iPhone. This launch is crucial for the company. If their mobile phone business goes under, at least they’ll have a cross-platform messaging app and some services to sell. Sure, the company probably should have released it six years ago. Still, better late than never. Now, if you had a crucial product launch coming up, what sort of press release would you issue the day before? If you’re BlackBerry, the answer is obvious. You pre-announce nearly $US1 billion in losses for the current quarter, along with the fact you’re slashing 4500 jobs or 40% of your global workforce. You know, just to make your consumers feel secure. Worse, most of those losses came from write-downs on unsold inventory of their touchscreen-based ‘comeback’ product, the Z10 smartphone. Basically, if this company is going to lose a billion bucks, this is possibly the worst way it could have happened. Now, before anyone accuses Old Taskmaster of being a BlackBerry hater, read this. Your humble correspondent is firmly of the opinion that the Z10 could have been a success – if the phone was marketed properly. It wasn’t. Or if BlackBerry communicated the fact it used a new operating system. It didn’t. And now there’s a $US1 billion worth of unsold Z10 smartphones sitting in a warehouse somewhere, gathering dust and getting ready to be dumped in a New Mexico landfill. This is on top of the existing uncertainty over the company’s future ownership. Apparently, co-founder Mike Lazaridis is now circling like a shark, and so is Canadian investment guru Prem Watsa. But whether they want the company whole or just pieces of it is anyone’s guess at this point. Well, a day after all this bad news, with no clear air, the big launch weekend comes. The Android version is supposed to be launched on the Saturday, and the iPhone version on the Sunday. There’s an official BlackBerry Twitter account to let users know when the app is available in their country. Well, Saturday comes around and the app launches in a few different countries – for iPhone rather than Android. It launches in three or four countries. Then the notices stop, with no warning or explanation. Several hours go by. Finally, there’s a message from the official Twitter feed: “Pausing #BBM4All rollout to fix issues caused by unreleased BBM for Android app.” The company also issues a statement explaining that issues caused by the Android version of the app are to blame. A few more hours go by, then this: “We will provide you with an update on timing as soon as we can. Teams are working non-stop.” From then on, it’s been radio silence. Now, anyone who’s dealt with a big tech product launch knows anything that can go wrong will. Which is why companies like Google have, in the past, made new product launches invitation only. Alternatively, instead of staggering out a launch over a weekend, they’ve staggered it over a week or a month. That way, you slowly build up the traffic on your servers instead of having a sudden load of people trying to access your service all at once. Likewise, make sure you have clear air in the media before a major product launch. There is a time and a place to announce bad news – and the day before a major product launch is never that time or that place. In short, if you want your business to succeed, look at what BlackBerry have done lately – and do the opposite! Get it done – today!
Surfwear giant Billabong is walking away from a $325 million refinancing deal from Altamont Capital, instead accepting a rival bid from Centerbridge Partners and Oaktree Capital Management. The new arrangement will see Billabong repay a $315 million bridge loan facility to Altamont along with a $6 million break fee. The Centerbridge Oaktree offer will see the surfwear retailer gain a six-year senior secured term loan of $386 million, along with a further $135 million through an equity placement. "This is a turning point for the company," Billabong chairman Ian Pollard says. "We'll now be back focused on business with a clear direction [and] new leadership. I must say, I'm looking forward to it." US Federal Reserve’s stimulus announcement causes the Aussie dollar to surge The US Federal Reserve’s announcement that it will continue its bond-buying stimulus program has caused an unexpected boost to the Australian dollar. The Aussie dollar recorded its largest single-day rise since 2011 – up US1.5 cents – following the announcement as the ASX 200 surged more than 1.1%. Stephen Elop’s $US25.5 million Nokia golden parachute Outgoing Nokia chief executive Stephen Elop is set to receive a €18.8 million ($25.5 million) golden parachute if shareholders agree to sell its mobile phone division to Microsoft. Elop’s termination agreement is set to include 18 months of his base salary, worth around €4.2 million, along with €14.6 million accelerated vesting of his outstanding equity awards. The controversial chief executive has been dubbed a “Trojan horse” by sections of the Finnish media. Overnight The Dow Jones Industrial Average is down to 15636.6. the Aussie dollar is up to US94.40 cents.
Recently, Old Taskmaster travelled from the sleepy hollow known as Parts Unknown into the great sprawl southeast of Melbourne. For those of you who are reading this interstate, the suburb of Pakenham is further southeast of Melbourne’s CBD (56 kilometres) than Penrith is west of Sydney (50 kilometres). To those Sydneysiders complaining about the M4 during peak hour, just be thankful you don’t have to drive down the Monash! Anyway, the reason for the trip was to take a look at the latest mobile phones. While in store, your humble correspondent noticed a rather peculiar promotion. Now, before going any further, here’s a question anyone with a little common sense should have no difficulty answering. Which of these consumers are more likely to sign up for a brand new smartphone? Is it someone who’s lugging around an old, out-of- contract brick in their handbag? Or the one who recently upgraded their mobile phone to one with shiny new features like NFC and is almost certainly still under contract? (For the non-mobile phone geeks, NFC or near field communications is a feature that allows Samsung Galaxy S4 owners to exchange files by being placed back-to-back and other smartphones to be used on services like Visa PayWave.) Well, if you’re BlackBerry, the answer is obvious. They set up a little cardboard display inviting users to touch their NFC-enabled smartphone to find out about a promotion the company’s currently running. Sure, using NFC on a marketing display has some novelty value. But there’s just one tiny little problem. Those with older mobile phones – the people most likely to be looking to upgrade – won’t get the promotion details, because their phones don’t have NFC. Using NFC might be slick, but if your potential customers use old mobile phones, it’s utterly useless. As for the promotion itself? It’s a cashback offer for anyone trading up their smartphone. What this means is someone who bought their phone last week gets a bigger inducement to upgrade than the consumer with the ancient phone. So in effect, there’s a cash incentive for someone who isn’t likely to buy, while those who are likely to buy can’t access all the marketing marital at all. Seriously, who came up with this strategy?! If this is what BlackBerry’s marketing looks like, perhaps their earlier non-marketing strategy should be viewed as wise cash-saving move. Oh, and did I mention the company is now officially up for sale? I wonder why. The lesson for your business is simple. Think about who your potential consumer is likely to be. Then focus on the promotional tools and platforms that are the most likely to reach your target demographic. And don’t use a novel technique if it’s not likely to be effective. Get it done – today!
Start-ups are increasingly turning to crowdfunding as a way to raise capital needed to launch their business. Liz Wald, head of international operations for crowdfunding platform Indiegogo told StartupSmart crowdfunding is taking off in Australia. “As is often the case with Australia and e-commerce/internet properties, the adoption has been very fast,” she says. “Part of that is because the language, payment types and culture is quite similar to the US, and part of that is because crowdfunding fits very well with the Australian independent spirit.” John and Lisa Winters, the co-founders of Hustle Bags, are currently running a crowdfunding campaign on Indiegogo to fund the first production run of their handbags that come with built-in mobile phone chargers. After paying the significant costs to develop the products with two suppliers in China, they’re looking to crowdfund the bulk order of leather and materials for the first production run. John Winters told StartupSmart while crowdfunding was still only an emerging opportunity in Australia, it was the right fit to generate much needed capital. “Starting a new business you need capital. It’s often quite difficult to borrow money from the bank,” he says. “Banks usually say no for a new business, and there were limited angles we had to finance this. We’d seen the success of these campaigns overseas, and we knew it was a problem everyone was having and decided to give it a shot.” They’re seeking to raise $75,000, and Winters says they’ve already raised enough for a minimal run, adding start-up operators need to factor in the cost of production into the discounts offered during the crowdfunding. “You can’t just break even on each product, you need to cover production as well so you have to factor that into whatever incentives and discounts you offer,” Winters says. “In China they don’t want to talk if you’re not talking in lots of a thousand, so that’s been challenging as we’re a smaller population than the US. But they know us now, and are willing to be flexible and grow with us,” Winters says they invested a month of time and significant funds into getting prototypes of all the handbag options, proper photography and a professionally produced video for the campaign. “The number one thing we read everywhere, and we’ve discovered firsthand, is to show the product is real, and the people behind it are real. You need to come across from a personal point of view.” Wald agrees that the most important element to get right in a funding campaign is the personality. “Remember that it's not enough to show the ‘what’, you really have to focus on the ‘who’ and more importantly, the ‘why’,” she says. “Why are you passionate about what you’re doing? What do you bring to the project that makes people want to support you? You are not begging for money, you are asking people to support your dreams, and that's something people can really get behind.” Winters adds crowdfunding is still an immature funding technique in Australia, so they’ve launched a two-part campaign. “What crowdfunding really comes down to is how you spread it through social media and the press,” he says. “Ninety-nine per cent of the people we’ve spoken to don’t know what crowdfunding is, so that’s been a challenge. We’ve had to educate people on what crowdfunding is, and then demonstrating how buying the products will get us into production.” The first production run will enable the team at Hustle Bags to pursue a range of distribution options, including several overseas options. Wald says crowdfunding has additional benefits not offered by more traditional funding options such as a bank loan. “You get instant feedback about your idea on everything from is this a good idea on its face, to what elements of this product or endeavour really resonate with people, to brand ambassadors for you before you've even launched your brand,” says Wald. She adds the financial benefits can go beyond the initial capital raised. “Clearly there are also financial benefits, the biggest being you retain 100% of your equity with reward and/or donor based crowd funding. We also see that ideas that were once passed on are now actively pursued by investors because of the market validation that the campaign provided,” Wald says.
Hunched over a laptop with a smartphone by her side, Andrea Sophocleous is a familiar sight in the cafes around the trendy Sydney suburb of Newtown. The freelance publicist and writer heads into a café, orders a pot of tea and transforms a table into a makeshift office for a few hours, returning calls, tapping out some words and checking her emails. Sophocleous is one of a growing army of Australians grabbing their laptop and escaping their home office to work from a café in search of new input and stimulation. Choosing a café over an office space is of course a far cheaper option, making it particularly appealing to start-ups. Sophocleous regularly works from Maynard’s Café, set within Berkelouw Books in Newtown. She spreads out her MacBook and paperwork on the vast collective table, which means she’s just taking up a single seat rather than an entire table, which she admits alleviates any guilt. “The reason I work from cafes is to escape the limited confines of my home office and hopefully benefit from external stimulation and inspiration. Some noise and excitement is good, but too much would be distracting,” Sophocleous says. “There are generally other people – freelance workers and students – working away on laptops, so at times it can have the feel of a hip open-plan office, particularly with all the books surrounding the café tables.” Melbourne businessman Paul Meissner launched his start-up from café tables, admitting he took over a table at a different café across the city every day for two years. He openly admits this saved him having to fork out for office space while setting up his cloud-based accounting firm. “The experience was amazing. In fact, many café owners were really appreciative of me being there.” Travel bloggers Caroline and Craig Makepeace also frequent cafes with their laptop to work. The pair works a six hour stint in their local café on the central coast, an hour north of Sydney, every week. When they’re on the road, they write from cafes across the country most days. The ideal café is one with comfortable couches, relaxing music, good coffee, power point access and where possible, free WiFi. Sophocleous opts for establishments with lots of light, enough space so you don’t feel like you’re tying up a table and a medium level of noise. The unwritten rules But there are some tips for ensuring you’re not booted out of a café for breaking any unwritten rules. Meissner recommends asking staff if they mind giving you a table near a power point to get some work done. Ordering a drink straight away, or order food if you’re there during meal times, he advises. “Try and order drinks steadily during the time you’re there. You don’t need to always have a drink on the go, but don’t sit there for hours on one coffee.” And if the café has a Twitter account or Facebook page, promote them as being friendly to business, he adds. Makepeace often asks the waiter if it’s OK if to work, just to be polite. “It’s a good gauge on whether it is the right working environment. You don’t want to stay if they will be resentful towards you.” If the café is busy, she’ll order a meal. “But if it’s quiet, I don’t think that’s important because you’re helping fill up the café and make it look popular.” If a few rules are followed, the majority of café owners welcome workers armed with laptops. In fact, a Brisbane café has taken the concept of welcoming workers one step further by renting desks for $10 a day to creative people wanting to work in a café. Located near Fortitude Valley, The Rabbit Hole Ideation Café provides WiFi, desks, chairs, lockers, a meeting room, air conditioning, and an outdoor patio for those wanting to work in a relaxed shared space. Melbourne’s Cupcake Central also welcomes workers. It is one of many cafes to provide a recharge station especially for workers. Paul Lange has worked in dozens of cafes over the years running his virtual business incubation program. He suggests hosting meetings at your favourite café, which brings new business in for the café owner. As people come to meet you, try and introduce them to staff and the café owner, he says. “When you find the right place and go regularly, you’ll find the owner will be happy for you to stay longer. You may even find that the occasional coffee or lunch is on the house.” What not to do But Brianna Robinson of Perth café Esprezzo doesn’t like workers parking themselves in her establishment for hours, so purposefully doesn’t offer free WiFi. “We find that generally, people who come in and work for hours on end on their laptops don’t purchase enough to warrant the seat they have taken up. One coffee does not justify staying three hours.” Correct etiquette would be to pay for your time by at least ordering a meal or a few drinks, she says. “If you intend to stay a while, perhaps ask staff where would be the best location to sit. We have nothing against people on laptops, so long as they pay their way,” Robinson says. Andrew Huffer of fellow Perth establishment Food for Me agrees not all workers play fair. “I’ve been in the position where I need to find a place to just sit down and get some work done. A cafe is the logical spot when you’re on the move,” he says. “But when I’m on the other side of the counter – things change. I get frustrated when someone plonks themselves down with a laptop in a prime real estate position and orders one latte over the course of three hours. That’s really pushing the friendship,” Huffer says. Although his business sense takes over and he works hard to make patrons to feel welcome so they return. Top tips – To find the ideal café to work from: Consider asking if the waiter minds you working before you sit down Opt for cafes with relaxing music, good lighting and lots of space Rotate cafes to bring new input and stimulation Make sure you order something, preferably a meal if the café is busy Choose a table with privacy so people can’t see what’s on your screen Come with fully charged equipment Be conscious not to speak too loud into your mobile phone or disrupt other diners
For all the retailers' complaints about customers choosing to purchase products online these days, there is no shortage of examples of poor customer service. Still, if there were a prize for the worst, one phone company – I’ll refer to them as “Virulent” from here on in – would be a certified top contender. This tale of woe began innocently enough. Your humble correspondent’s contract recently ran out, and after 24 months of calls dropping out on another carrier, it was time to switch. Now, sure, many years ago when I was last on Virulent – using a pre-paid mobile at the time – an error in their billing system somehow resulted in me getting a bill. That’s right, a bill for a pre-paid phone. But that was many years ago – surely this company must have improved at least a little since then? Well, Old Taskmaster walked in to the local Virulent shop in search of a new plan. Soon the memories came flooding back of why I’d stopped using them many years ago. After what felt like 40 days and 40 nights poking at new Samsung Galaxies, BlackBerries and iPhones, I was (finally) approached by one of their sales staff. Unfortunately, a glum look befell this young salesman after I explained how I wanted to give the company he works for some money. “I’m sorry, we ran out of pamphlets explaining our current mobile offers. Do you know which plan you want? I mean, we have 12-month plans, 18-months, 24-months or no contract ones. You might want to go home and look it up on the internet and come back here later once you’ve decided which one you want,” the bad salesman says. Now, if your job were to sell mobile phone plans, surely some basic familiarity with the products you’re selling isn’t too much to ask for? That said, even if this chap is a new trainee, why isn’t there at least one copy of that magic sheet of paper with the plans floating around somewhere? Thankfully, the other carrier had just enough coverage to get one bar of coverage to (slowly) pull up Virulent’s website on Old Taskmaster’s smartphone – enough to look up Virulent’s plans. Upon nominating an offer, another problem emerged… “Unfortunately, we don’t sell our sim cards here, but you can try the Virulent dealer down the street, they sell them. Or you can order one by calling our sales hotline if you like,” says the young salesman. “Actually, if you know what you’re after, just step this way, we do have some computers over here and they’re connected to our website. If you like, you can place your order on this computer…” Now I’ve heard of pushy salespeople before. I’ve met some passive order takers in my time. But there is nothing quite so sad as a salesperson who is actually afraid of selling their employers’ products to a customer willing and ready to purchase. While I’m sure this young chap will eventually find his true calling in life – most likely in a field other than sales – there are also a number of clear deficiencies on the part of the employer that allowed this poor service to occur. These potentially include insufficient product training, poor systems support, inadequate inducements, poor recruiting and a corporate culture of complacency. Old Taskmaster’s advice? Lazy or indifferent workers follow the path of least resistance like water in a blocked riverbed. So make sure the structures are in place to channel them in the right direction! Get it done – today.