I retired from personal blogging in July 2008 but you can find me over at blog.xero.com
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Telecom is wanting to sell their Directories business claiming it is good for shareholders.
What !?!?!?!
I know a little bit about the Directories business, and I’m shocked that anyone would think selling a directory business is a good idea. I don’t get this logic …
Ms Gattung said the directories business internationally was moving online where it would be dominated by big, global players. Telecom was “well advanced” in striking a deal with a major international player, believed to be Yahoo.
Does Telecom not think that the same Customers and Listings that use paper directories are the same Customers and Listings that would use an Online directory?
So you want to sell your customers to a competitor because you want to come into the same market with new technology?
Unfortunately this lack of basic eBusiness understanding is typical of the current Telecom leadership. A few years ago they brought Gen-I, a good IT Services business because they were getting into IT. Any IT firm knows how important it is to own the Directory system (e.g. Netware or Active Directory) because almost every high value application hangs off the resources of the business. Its people.
Telecom has a very limited view on what directories are about. Today it is just fixed line yellow and white page listings. Once they figure out the next generation directories, you’ll be able to do any type of transaction with connectivity calls are just one aspect of this. All communication requires some form of a directory, in fact most transactions require a directory for that matter – and for that a transactional fee is entirely appropriate – the carriers are totally missing the boat on this concept.
In a Telco world, the listings of people is the basis for any ‘Directory Enabled Commerce’ applications. In Telecoms case it has the fixed line directory which has almost all potential customers in the country, including customers who may have the majority of their services with Telecoms competitors.
Telecom has never, ever, innovated with Directories. The DA platform is essentially the same as it has been years. Only very recently have the most basic of additional services like ‘text the number to me’ been introduced (5 years after it should have been).
Telecom has some smart people. Guys like Mark Rushworth were deep inside Telecom before he was CEO of iHug and look what he did there.
After the Gen-I purchase they should have used the acquired IT skills to innovate with Directories. They didn’t. So now they are promoting this misguided strategy with the only justification of returning cash to shareholders. So at a time when Telco’s move online, they want to un-invest and pass away their biggest asset? I’m sure the clever people inside Telecom woudl love to have a shot at rolling our new Directory based services. Maps, Mobile DA, Location, Payments, Classifieds, Rich adverts etc, etc.
Just look at Yell in the UK – it was spun out by BT – BT has now created BT Directories but it is no where near what Yell is about.
With Theresa clearly on the way out, shareholders should freeze this transaction in case the new leadership actually understands eBusiness. Don’t let her parting shot be to hock off one of Telecoms biggest assets.
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I am as surprised as you for similar reasons!
A sale = cash = short term thinking = a bonus for Theresa and she could leave on a “medium” note (I don’t under estimate the self serving nature of some employees of public companies); some short term respite in respect of dividends for shareholders who have been hit by a drop in share price, but now future opportunities lost …
Telecom has been operating on a short term planning cycle for many years. I am glad that market reality is starting to really bite into them. Of course they are going to react in a series of short term “strategies” and frankly I’m going to enjoy watching their demise. The smart companies that pick up the pieces will be more effective in delivering value to end users. My bet is that as internet based communication grows Telecoms value will subtend to the net worth of ferret.
I am scratching my head at this one too. Sure, Telecom hopes to get $1.5 billion plus to keep shareholders happy with through a special dividend, but they’re selling the White Pages, Yellow Pages, the Local Directories, the NZ Retirement Guide, NZ Tourism Online and 018.
How acceptable politically is such a sale?
Will the new owner distribute free white pages to all Telecom customers? What about access to 018?
What safeguards will be placed over the information that is being sold off? Remember that it contains a huge amount of data that could cause grief in the wrong hands…
Sshh…
Big call by Telecom - are they only lured by the $1.5 - $1.8 billion valuation ?
And where did those numbers come from ?
Is this just about selling content ?
It does seem very weird. Don’t those that know (or not know) listen to all the talk of “social networks”, “social web” and the like - all this is centered around ‘people’.
In my attempt to put all my information on line (electronic versions at least) and not have to worry about what PC/computer I use the one issue that needs some serious technical/business thinking brought to it is how to separate, centralise and share (across whatever Web app/service I care to use) the contact list. I have one in my email provider, one in my document collaborator, one in my photo sharing … one everywhere, and I have to keep them all up to date.
Now, if this was centralised like, oh, say a directory service (maybe even an electronic version of the white pages) then I’d be a happy boy. Wouldn’t Telecom think they’d be in a perfect position to supply this sort of information … people is where it’s at and they have a list of people.
Doh!
We were not sure about the valuation numbers being thrown around either - so we did some analysis.
http://www.valuecruncher.com/wordpress/?p=29
could you set up something similar to what Telecom has on offer for around a billion ?
Thought so.