General Motors


Controversial tech entrepreneur to political leader: The new startup career path

4:45PM | Tuesday, 22 April

Controversial tech entrepreneur Kim Dotcom has announced the formation of a new political party, known as the Internet Party, ahead of New Zealand’s next general elections in September.   German-born Dotcom is best known as the founder of the controversial file sharing website Megaupload, for which he was indicted in the US on charges relating to piracy.   Since then, he’s gone on to launch a new venture, a highly encrypted cloud storage service called Mega.   His new party’s positions include delivering cheaper high-speed internet, better oversight of spy agencies, opposition to the Trans-Pacific Partnership Agreement, copyright reform, the introduction of a digital currency and the introduction of a digital bill of rights.   However, Dotcom is far from the first tech figure to turn to politics – with some having more success than others.   StartupSmart looks at five other high-profile tech figures from the tech world who have gone on to their hand at politics – often with mixed results.   1. Julian Assange, Wikileaks Party   Should Dotcom’s party get off the ground, his political career will inevitably be compared with that of Julian Assange.   Assange is best known as the founder of whistleblower website Wikileaks, along with a long-running series of court cases relating to rape allegations in Sweden. Since August 2012, facing the threat of arrest, Assange has been granted asylum in the Ecuadorian embassy in London.   After being granted asylum, Assange announced plans to form a Wikileaks political party. The Wikileaks Party contested the 2013 federal election, but only received 0.66% of the vote.   Along the way, several high-profile candidates, including prominent academic and former Wikileaks lead Senate candidate Leslie Cannold, abandoned the party.   2. Ross Perot, Reform Party   A far more successful minor party campaign was run in the US by Texan tech entrepreneur Ross Perot.   Perot got his start in the tech industry all the way back in 1962, when he launched an information technology equipment company called Electronic Data Systems. Perot eventually sold the company to General Motors in 1984, which in turn sold the company to HP in 2008.   It was around the time of the sale to General Motors that Perot met another young tech executive named Steve Jobs. After being ousted from Apple, Jobs had launched a new tech startup called NeXT, and Perot decided to make an investment.   The products Jobs’ company developed included an operating system called NeXTStep, which would eventually form the basis of Mac OS-X and iOS after Jobs returned to Apple. Perot also sold another venture – Perot Systems – to Dell in 2009 for $US3.9 billion.   Of course, these days, Perot is best known for standing as an independent third candidate in the 1992 US presidential election against incumbent George Bush Snr. and Democratic Party candidate Bill Clinton.   The Texan stood on a platform combining a mix of policies mixing positions traditionally advocated with the left and the right of US politics. For example, Perot advocated a balanced budget, a tough stance on drug policy and opposition to gun control. However, he also advocated in favour of abortion rights, protectionism, an end to outsourcing and a strong Environmental Protection Agency.   Perot ended up winning 18.91% of the vote, an incredible result for an independent presidential candidate in the US. He stood a second time in 1996, picking up 8% of the vote against President Bill Clinton and Republican candidate Bob Dole.   Story continues on page 2. Please click below. 3. Rickard Falkvinge, Pirate Party   Of course, when it comes to Kim Dotcom, perhaps the best political role model to follow might be Rickard Falkvinge.   Falkvinge grew up in the Swedish city of Gothenburg, next door to the home ground of football club Västra Frölunda.   Falkvinge’s biography reads like a list of tech entrepreneur clichés. He got his first computer, a Commodore VIC-20, when he was just eight-years-old. By the age of 16, he had launched his first tech startup, a company called Infoteknik. At the age of 18, Falkvinge hired his first employee.   More than making profits, Falkvinge was motivated by the free exchange of ideas that came with the early home computer market. He grew increasingly concerned that harsher copyright laws being lobbied for by the motion picture and record industries could stifle online innovation.   His concerns about patents, copyright law and file sharing restrictions led Falkvinge to form a new political party. On January 1, 2006, he launched the website of his newest venture – dubbed the Pirate Party.   While the new party managed just 0.63% of the vote in its first Swedish elections, it grew to 7.13% for the 2009 European elections. The pirate party model was mirrored internationally, including in Australia. On January 1, 2011 – five years after its launch – Falkvinge stood down as party leader, handing control to his deputy, Anna Troberg.   4. Malcolm Turnbull, Liberal Party   In Australia, the most prominent example of a (far less controversial) tech executive turned entrepreneur is communications minister, Malcolm Turnbull. Before entering into federal politics, Turnbull has served in many roles, including as the general counsel to Kerry Packer’s Consolidated Media Holdings, the cofounder of law firm Turnbull McWilliam, the chair of the Australian Republican Movement, a journalist and a partner at Goldman Sachs.   Turnbull became the chair of pioneering Australian internet service provider OzEmail in 1994, also becoming an investor in the company. In 1999, at the peak of the ‘90s tech boom, Turnbull sold the company to US telco MCI WorldCom.   In 2004, Turnbull won the by-election for the federal seat of Wentworth, being elected as the local Liberal Party MP at the general election later that year. Since then, he has served as the environment minister in the Howard government, as well as the leader of the opposition.   5. Paul Fletcher, Liberal Party   These days, Paul Fletcher is best known as the Liberal MP for the federal seat of Bradfield, as well as a parliamentary secretary to the minister for communications. It’s a position he’s held since December 2009, when he won the seat at a by-election after former opposition leader Brendan Nelson retired from politics.   However, before entering into politics, Fletcher served as a senior executive in one of Australia’s largest telecommunications companies Optus, between 2000 and 2008.   After stepping down from the role, Fletcher authored a book titled Wired Brown Land? Telstra's Battle for Broadband, which dissected the case for Telstra being allowed to build the national broadband network.   He has also run a strategic consulting business focusing on the communications industry, and also served as the chief of staff to former communications minister Richard Alston.

Toyota closure reinforces need for innovation to create new jobs

2:17AM | Tuesday, 11 February

Toyota’s announcement that it will stop making cars in Australia by 2017 adds to the urgency for productivity and new jobs to be created elsewhere in the economy, says one of the leaders of Australia’s start-up sector.   “My personal experience over the years has been that as far as innovation is concerned, necessity is the mother of invention,” Leni Mayo, chairman of Startup Victoria, told StartupSmart.   Toyota’s announcement draws the curtain on Australia’s car manufacturing industry, following earlier announcements that Ford and General Motors Holden were also closing.   Thousands of people working for the companies will lose their jobs and there are fears thousands more are under threat as car component makers consider their futures.   Mayo says while it will be difficult for the workers who lose their jobs and their families, manufacturing as a share of Australia’s economy had been declining for the past 40 years.   “That’s a trend that’s going to continue,” he says, noting that service-related businesses now make up the bulk of Australian jobs.   Mayo says thought must go into what can be done to accelerate the growth of start-ups to fill the gap left by manufacturing.   He points to more innovation in the services space as a key area to promote where companies such as Seek and found success.   He also urged politicians to celebrate start-up successes and openly talk about failure, as well as create more visibility and legitimacy around start-up activity and encourage people into pursuing science and technology at university.   “We’ve got a long way to go in Australian compared to the US and Israel with how we feel about failure.”

THE NEWS WRAP: Premiers to meet Tony Abbott after Holden closure announcement

12:23PM | Wednesday, 11 December

The premiers of Victoria and South Australia, Denis Napthine and Jay Weatherill, are set to hold talks with Prime Minister Tony Abbott following the announcement by Holden it will end production in Australia by 2017.   The decision by Holden’s parent company, General Motors, to end production in Australia will directly impact 2900 jobs over the next four years across Victoria and South Australia, with more than 30,000 jobs at risk nationally.   “It's about the whole industrialisation of our economy, and what now needs to be put in place to replace what is a very significant element of the South Australian economy, indeed of the national economy,” Weatherill says.   “I'll seize that opportunity to talk to Mr Abbott about the future of Toyota and how the federal government can work with the state government and Toyota and the entire automotive supply chain industry to secure the future of Toyota,” Napthine says.   “I spoke to Mr Yasuda of Toyota last night. Obviously the government will be talking to Toyota… We want Toyota to continue. They are in a slightly different position to Holden – much more of their local production has been for export,” Abbott says.   Bill Morrow to be named new NBN boss   Vodafone chief executive Bill Morrow is set to be named as the new chief executive of the NBN Co., according to reports.   The announcement is set to be made as Communications Minister Malcolm Turnbull prepares to deliver a strategic review into the rollout, which identifies cost issues and flaws in Labor’s rollout of the project.   Vodafone plays hardball on rents   Mobile communications giant Vodafone is threatening to abandon stores as part of its hardball negotiating tactics with retail landlords, as the struggling telco attempts to renegotiate leases on its stores.   “[They] verbally are refusing to pay the rent. For an enterprise of the calibre of Vodafone, this is cowboy behaviour, considering all the bad press Vodafone have had. They are playing hardball,” one landlord told Fairfax.   “This request [to cut rents] is on the back of numerous store closures that have been performed in the last two years due to the significant losses that have been incurred from the impact of customers leaving. In conjunction with the above customer base loss there have been considerable revenue losses,” a leaked letter from the company to landlords reportedly states.   Overnight   The Dow Jones Industrial Average is down to 5109.5. The Aussie dollar is down to US90.63 cents.

THE NEWS WRAP: Slowdown in business confidence growth during November

12:35PM | Tuesday, 10 December

There has been a slight tempering in business confidence following a post-election surge, according to the latest NAB survey.   The index fell to five points in November, after hitting six points in October.   A score above zero suggests confidence is improving, with higher readings suggesting a faster rate of improvement.   “People are starting to see that changing the government doesn't change the economic activity levels. The other thing that also doesn't help is that our employment confidence was quite weak. And so that was offsetting some of the better trading conditions we were seeing,” NAB chief economist Alan Oster says.   General Motors names its first female CEO   General Motors is set to become the first US automaker to be run by a woman, after naming its global product development chief, Mary Barra, as its new chief executive.   Barra will be the company’s fifth chief executive since US President Barack Obama forced out Rick Wagoner in 2009, and replaces Dan Akerson, who is standing aside after learning his wife had an advanced stage of cancer.   “This is an executive who has a vision of where she wants to take the organisation. [Barra] is an adaptive personality and one who reacts to change well,” Akerson says.   Qantas shares nose-dive to a record low as Abbott rejects bailout   Qantas shares hit a new record low of just 96.5 cents, after the airline’s announcement it is expecting a first-half loss of $300 million, prompting ratings agencies to downgrade its debt to junk bond status.   The airline has since announced plans to slash 1000 jobs over the next 12 months.   However, despite calls from Qantas executives, Labor and trade unions to provide the struggling carrier with subsidies, saying that a bailout would risk creating a “bottomless pit” for taxpayers.   Overnight   The Dow Jones Industrial Average is down to 5146.2. The Aussie dollar is up to US91.61 cents.

THE NEWS WRAP: Holden threatens to end Australian production over pay dispute

6:16PM | Tuesday, 18 June

Holden managing director Mike Devereux has threatened to end car production in Australia if employees at its Adelaide plant fail to accept a pay cut.   The secretary of the Australian Manufacturing Workers Union's vehicles division, Dave Smith, blames Tony Abbott, claiming the announcement “smacks of the Coalition behind the scenes”.   However, according to Devereux, it costs Holden parent company General Motors $3750 more to build a car in Australia than overseas, with $2000 of the total due to labour costs.   “Australia is among the most expensive places to build cars anywhere on the planet. Our geographic isolation, the cost of sourcing local components and our high labour rates mean we pay a significant premium to manufacture cars here compared to importing,” Devereux says.   Facebook hits a million active advertisers   Facebook has reached a new milestone, with the social media giant claiming that a million active advertisers globally have used its service in the past 28 days.   “Most small business owners start off as Facebook users, then migrate to become page owners, and from there migrate to become advertisers,” says Facebook director of small business Dan Levy.   According to market research firm eMarketing, small advertisers in the US spent around $US32 billion on online advertising during 2012.   Pacific Brands reveals international expansion and omni-channel retailing plans   Pacific Brands chief executive John Pollaers has cited product innovation, international expansion and a move into omni-channel retailing as key future moves for his company’s Bonds and Berlei brands.   “We will deliver higher impact innovation in the core categories but we'll also look to expand into other categories and then we'll start – not rush at – laying down some of the ground work for the development of an international footprint over time,” Pollaers.   “[Outlet stores are] an avenue for the distribution of brands that haven't traditionally been at wholesale distribution. We're able to… expand our broader customer base and because we don't have any legacy retail infrastructure we're able to move to a streamlined multi-channel structure straight away.”   Overnight   The Dow Jones Industrial Average is up 0.92% to 15,319.15. The Aussie dollar is down to US94.81 cents.

THE NEWS WRAP: Former British prime minister Margaret Thatcher dies, aged 87

4:23PM | Monday, 8 April

Margaret Thatcher died peacefully last night, aged 87, with Britain’s first female prime minister set to receive a ceremonial funeral with full military honours at St Paul's Cathedral.   Thatcher is considered to be a hero by many conservatives, who credit her with rebuilding the British economy through key policies, which included the privatisation of government assets and her role in ending the UK coal miners’ strike, which in turn drew controversy from those on the political left.   “It was with great sadness that I learned of the death of Lady Thatcher. We have lost a great leader, a great prime minister and a great Briton,” says British Prime Minister David Cameron.   “The Labour party disagreed with much of what she did and she will always remain a controversial figure. But we can disagree and also greatly respect her political achievements and her personal strength,” says British Labour leader Ed Miliband.   Holden told to "go better" after cutting 500 jobs   General Motors Holden has announced plans to cut nearly a quarter of its workforce, with 400 jobs set to go in South Australia and a further 100 job losses in Victoria, prompting renewed criticism about government subsidies for the auto giant.   “After the loss of these 400 to 500 staff [the cost per job] then rises to more than $50,000 of subsidy per employee. It's quite a large sum of money,” said Simon Cowan from the Centre of Independent Studies.   “I think we deserve better. There are a range of important undertakings in that agreement that I want to ensure are delivered to South Australians and now we need to have some serious discussions with the company," said South Australian Premier Jay Weatherill.   Vodafone announces 4G network rollout   Vodafone has announced the rollout of 4G services, following significant falls in the company’s subscriber base in recent years.   “At least for a period of time, we will have the fastest 4G network in Australia. We will have a bit of a differentiation point that no one else has,” said Vodafone chief executive Bill Morrow.   Overnight   The Dow Jones Industrial Average is up 0.33 per cent, at 14,613.40. The Aussie dollar is up to US104.10 cents.

THE NEWS WRAP: Auto industry defends government handout

3:25PM | Thursday, 22 March

Car industry bodies have insisted that other businesses will benefit from the Federal Government’s latest handout to the ailing sector.

Middle East a “fantastic” franchise market, says Nanotek chief

11:48AM | Tuesday, 22 November

Franchise veteran Jim Cornish says the Middle East is a “fantastic” market for local franchisors looking to expand internationally, having recently launched his own franchise in Saudi Arabia.

SEO hijacking not off limits to start-ups

2:02PM | Wednesday, 16 February

An SEO expert says start-ups should consider hijacking search terms associated with other businesses in light of General Motors’ recent SEO success using phrases featured in popular Super Bowl advertisements.