All my utilities have now been arbitrarily cut off

First they came for my electricity, and I did nothing. Then they came for my gas, and I did nothing. Then they came for my electricity again, and I got mad and blogged about it.

Now they have come for my internet. and my phone. and my Sky TV.

I arrived back home here in Wellington after far too many months overseas to find all three of these utilities are not functioning. (All bills are paid.) Actually I have no idea about the phone, but I assume it is off – you’ll see why.

I called Sky first, and they remotely reset my card and everything worked again instantly. Well done Sky, and very quick and efficient on the phone.

Next I tried the to restore internet. The wifi network was fine, router looked ok and was even reporting up and downstream speeds. So I called ISP Orcon. They also answered pretty quickly, which was again excellent, but only after a painful voice prompt system. (Note to people that set these up – talk faster, much faster. If I didn’t get it the first time then repeat it by talking slower and adding more words. The first time should last a few seconds)

The Orcon CS guy took me through a prolonged identification system so that my account was showing on their screen. He then informed me that my account had been closed back in June. It was closed after Telecom “informed Orcon that I was discontinuing the service”. That’s five months ago. While I’m glad that I have not been paying for internet that I have not been using, this was unacceptable. It was not only the first time I had heard that I had been disconnected, but I had also not asked Telecom to disconnect me, and I had received no notificaaton from them either. Someone at Telecom had the power to disconnect me, and nobody could do anything about it. That’s f#$%ed up.

Orcon let me know that despite a data connection being visible to me it would still take the usual ridiculous amount of time for me to get the internet back on, and they didn’t seem that interested in determining what had happened or in getting me back aboard.

So I just called it quits.

No call to Telecom, no reordering of the internet – I’ve had enough.

I’ve had almost enough to call it quits on this country.

Australia is bad enough – it’s taken me 2 months to get internet at my new place there after the ISP punched in the wrong address for Telstra. ISP iinet has the same dependence on giant incumbant ISP problem that Orcon has with Telecom. But at least once that Naked DSL line is working I will have no further dependance on Telstra, and no home phone line to pay ridiculous monthly rental fees on. (I pay those to Telstra for my iPhone instead).

So let’s summarise what we have here:

1: Neither Orcon nor Telecom informed me that they were about to disconnect me. Orcon was losing a customer and did nothing to attempt to retain them.

2: Neither Orcon nor Telecom informed me that they had in fact disconnected me. Orcon lost a customer and did nothing to regain them.

3: Despite an active connection it still takes weeks to get internet working. That means lost customers between moves.

4: Orcon and Telecom both suck.

5: I give up. It’s TelstraClear or bust for me next time.

I don’t get it. There is such a vibrant scene happening in the web space here in Wellington. Can’t we at least have the basic serivces functioning?

Three business ideas: 1: Baby Business Bank

It’s easy to take advantage of today’s doom and gloom, but you need a stiff will and plenty of freed up capital. Here is the first of three ideas.

1: Baby Business Bank

It’s hard enough these days to get finance for a house – but it has always been hard to get bank finance for small businesses. I’m referring here to small yet established or high potential businesses that have a steady cashflow and growth potential. It drives me nuts when you have a strong P&L, solid enough balance sheet and will clearly benefit from capital, and yet the traditional banks will have nothing to do with you.

Those traditional banks want some sort of security over tangible assets – such as buildings, machines or the owner’s house. This is fine for traditional high capital businesses, but these days we are driven to be much more capital light, and so there is not a lot of security to get liens over.

A decent business oriented bank should be able to look hard at the business fundamentals and provide finance based on the operation and accounts receivables, not the assets. There are plenty of businesses that have a demonstrated market, clear ability to ramp up production and yet are financially constrained and must grow slowly or not at all. A decent business bank could back these companies with a combination of debt and convertible equity. Convertible Equity is debt that can convert into an equity stake in the company.

I’m talking about small businesses here – the ones that traditional banks ignore, and that are too small for investment banks to care about, and too small or low potential for the small private equity sector to care about. They are less than $5m in revenue, and down to a few hundred thousand.

The aim is to have business bankers that are smart enough to evaluate a business and its people, and make very quick decisions on investments. They monitor the health of the company each month (perhaps as a Director) and provide considered advice as required. They are not overly active managers, as each banker will have a wide portfolio. The most important point of difference from other banks is the lack of dependence on a computer system, and much more use of discretion, relationships and plain old common sense.

As the bank grows they can move into the territory of the incumbents  – personal loans and loans to more established, bigger businesses. Sooner or later – you have a real bank.

To lend money, you first need to have money.

In this climate the starter money will need to come from established wealth, as it’s unlikely that banks will be looking for opportunities to invest in yet another finance coany.

As the business grows, the baby business bank can bundle the debt and sell it, much like the (collapsed) finance companies did with real estate debt. However this debt can contained the upside from the value of the convertible options – if any of the company’s perform well the the returns could be very high.

This may sound like a private equity or Venture Capital firm – but I am thinking of an order or two of magnitude difference, with hundreds to thousands of loans, and loans of $100,000 to $500,000. Think of each loan as about the same size as a housing mortgage, and it doesn’t seem so large.

There are plenty of barriers to starting this and making it successful, but the market gap is there for the taking, and I’d love to do it just to see the impact on local businesses.

That’s the idea.

I talked about this with a friend, and he mentioned the latest news is that Pyne Gould Corporation is moving to do something like this, with subsidiaries Marac and Perpetual Trust proposed to be restructured into a Bank:

“This restructuring into a specialist bank will enable these businesses to better meet the needs of their customers by offering financial services to both small- and medium-sized businesses throughout New Zealand and also specialist personal banking for individuals”

Marac already lends to businesses, including invoice financing and other commercial lending, however the largest chunk of their financing appears to be for vehicles and property.

A not bad but ultimately unrevealing 2008 annual report for PGC doesn’t really help shed light on the range and risk of their assets – $374m is “property”, $357m is “consumer and personal” (probably vehicles), and $235m is “wholesale and retail trade”. That last category is interesting, but there is no indication of the sort of lending – it could be vehicles or business financing. The other big categories of over $100m are “transport & storage” and “constructon”. That last one is a bit dodgy these days, along with the large property loan portfolio.

Marac’s business lending is constrained to finance based on existing assets, such as machines or invoices. The market gap is finance for growth – finance that is not backed by tangible assets, but by the knowledge that the company will almost inevitably expand. I imagine there is also an opportunity to be aggressive in this new era of ultra-conservative lending.

XNET are Spineless and Uncaring

I was at a friend’s house the other night, and we were trying to work online. The DSL router/modem was working just fine, our phones and computers were all just fine, but no internet.

The ISP was XNET, who have no phone customer service at night after 8pm – which is not exactly a quiet time for traffic.  I regard internet access as a utility – up there with electricity, gas, water – not that they are much better, and no service means a lot of stuff grinds to a halt.

After calling the next morning (at 8:01 – they open at 8am) we were referred to the email below, which was sent to the customer’s XNET Webmail inbox. That XNET webmail inbox had received a total of 5 emails since mid May – none of which had been opened. (Who uses an ISP’s mail box – especially with boutique ISP’s?)

So XNET sent an email to their own unused inbox, and then dropped access to the internet for the house. No phone calls, no emails to an address that is actually checked. Nothing.


Sender: WorldxChange Communications
Recipient: xxxxxx@xnet.co.nz
Date:
Dear Customer,

We have received notice regarding your IP address (at the time) actively downloading the following copyright material.

“received notice” is one thing, but did you follow up? Did you check?


This activity is against our terms of service which you agreed upon when joining Xnet (Acceptable Use Policy http://www.xnet.co.nz/content/terms.shtml). If you have received this email without speaking to a customer service representative, then please call us on 0800 14 9638 to expedite the notification process.

http://www.xnet.co.nz/content/terms.shtml referred to resolves to a 404 error. T&C’s are actually here (pdf)
There are all sorts of goodies in that policy – like an Excessive use clauses (warn, shape, cancel), simultaneous connections ($5 per connection – execrable), and a final statement that says “All services are provided by WorldxChange Communications under New Zealand Law.” Hold that thought.


What Is A Copyright Infringement Notice?

The movie, game & music industries have empowered a number of organisations to investigate and prosecute breaches of copyright occurring on the Internet.

So another organisation is able to identify a customer from your records? Where is our privacy? Who is this organisation? Are they operating under NZ law? How did they identify the customer? Why did you pass their message through? Did you pass customer name and details to them? Is that legal?

A copyright infringement is notice of a copyright breach which is usually sent to the offending users Internet service provider. You put yourself at risk of receiving a copyright infringement by using third party sharing programs and downloading copyright content from the Internet.

What happens if I receive a Copyright Infringement?

You will be warned and provided with a copy of the infringement in question. We will attempt to contact you within a 24 hour period to notify you of the Infringement. If we are unable to speak with you your internet service will be temporarily suspended until we are able to do so.

No messages left, no voice communications attempted, no effort made to contact the customers. XNET just dropped the connection.

The option is available to contact the copyright organisation and dispute said infringement. If copies of correspondence can be shown to clear the matter the infringement will not be taken into account.

Sure. Contact the RIAA or MPAA or ESA to discuss their allegations that you have downloaded copyright material? That’s asking for a court case that you cannot afford.

What happens if I receive a second Copyright Infringement?

We will attempt to contact you within a 24 hour period to notify you of the second Infringement. If we are unable to speak with you your internet service will be suspended until we are able to do so.

The Internet service will be closed & notice of the second infringement will be given.

The option is available to contact the copyright organisation and dispute said infringement. If copies of correspondence can be shown to clear the matter the account can be re-instated.

Overview

Copyright breaches are illegal and dealt with in a serious manner. We do not wish to lose a customer however repeated Copyright Infringements leave us with no choice. If you receive two infringements (un-disputed) your Internet service will be closed and you will need to find another provider.

Best regards,
WorldxChange Communications
Ph : 0800 14 XNET (0800 14 9638)

— Infringement Follows —
Case:
ID:
Status: Open
Complainant:
Entity: Entertainment Software Association
Contact: Anti-Piracy Enforcement, Intellectual Property Enforcement Manager
Address: 575 7th Street, NW Suite 300, Washington, D. C. 20004 United States of America
Phone: 1(202) 223-2400,1(202) 223-2401
Email: esa@copyright-compliance.com
Service_Provider:
Entity: WorldxChange Communications
Address:
Email: abuse@wxnz.net
Source:
TimeStamp:
IP_Address:
Port:
DNS_Name: xxxxx.xdsl.xnet.co.nz
Type:
UserName:
Number_Files: x
Deja_Vu:
Content:
Item:
Title:
FileName: somegame
FileSize: xxxxx
URL: somerandomemeaninglessurl

So the ESA sends through a breach notice, these spineless guys just nod, append it to an automatic email and then drop the connection. No phone call, no judge, no jury, just capricious disconnection of what these days is regarded as a utility.

My friends are seeking another ISP. And I disagree with Mauricio – XNET shold not put their prices up, they should fix their customer approach and customer service hours first.

Oh – did my friends download the dodgy file? They certainly didn’t themselves, but they have children with computers & they have a wifi network, so who knows? The point is that the ISP presumed guilt, disconnected a service without first contacting the customer and didn’t provide a mechanism for getting back online past 8pm at night.

Statistics takes down poker cheats

This story of busting a $15m poker scam by and Australian is fantastic – and is a wonderful demonstration of the benefits of being open with your customers. The full story is on poker community site twoplustwo, and has been going on for a while.

Customers of Canadian tribe owned AbsolutePoker and UltimateBet analysed poker hand history, and discovered that some people were winning far more than statistically probable. They raised it with the company (same parent co) and after, apparently, an unreasonably long length of time they agreed that sure enough, insiders had been playing – and winning – hands with the ability to see what all of the other players were holding. Turns out the server software had security holes in it – something that in an open sourced piece of software would have long been plugged.

The cheats were a bit naive, and should have learned from the professionals – if you have a system that can beat the house, then don’t beat the house up (even if you are the house, which in this case it appears they may well have been.). By winning too often it was blatantly obvious that something was amiss. Moreover apparently some of their play was only logical if they could see everyone else’s cards, which raised suspicions of fellow players..

Far better, if you are a cheat and don’t mind the heightened risk of losing your friends, reputation, teeth and/or liberty, to only look at the opposition cards now and then – and thus avoid the temptation of winning too much. Even better, learning from the Blackjack card counters, lose consistently when the stakes are small, and then cheat only when you have gone big and dragged others with you. That may mean losing when you could have won, just to keep the win/loss stats down.

Even these approaches are testable if the data is released. First – look for overall biggest dollar winners, and go after them with a fine statistical comb. Look for anomalies in win/losses for certain types of hands versus the size of stake and what other players have done.

The article does not say whether Michael Josem, the chap that did some of the original analysis, captured the hand data himself or was able to download it. However the Poker community page shows that they got the data through the players collaborating after the fact, and via a spreadsheet that contained a wee bit too much data. Actually the Stuff article misses a lot.

I hope that other poker sites learn from this, and publish their game records for all to see, along with statistics. Meanwhile releasing the source code of the software to highlight any holes wou;ldn’t be a bad thing either.

Paymex is back, but why would you trust them?

There has been lots of commentary on the Paymex debacle, and today I see that Paymex’s site is up, and there is a comment on this news entry from the “new owners”.

Some advice, for free:

1: if you want us to trust you, please tell us who you are

2: If you want us to trust you, guarantee to pay back everybody – it’s not that much money

3: If you want us to trust you, then do a heck of a lot better than this:

Hi Everyone

We are the new owners of Paymex.

[who the hell are you? Why should we trust you? why is this post a response to a news item, rather than a new news item?]

Over the last 7 days we have been working non stop with the bank to set up a system which protects the users further.

[Which bank? A system protects the users further from what exactly? What is a user? How much money are you putting in?]

Part of this means that you will notice some process changes and functionality which will become more obvious once we go live. Some examples are a more in depth sign up form and processing limits to avoid run away transactions (there will still be the option to process higher amounts on an application basis).

[what is a run away transaction? why do you need more information from us?]

We’ve also spent the last 7 days making changes to the system which further improve on the securities.

[“the securities”? you have securities? – I hope they are not CDO’s. Or did you mean “Security”?]

As soon as we get the green light we will be able to tell you exactly what those added securities are so you can feel confident that your funds are safe.

[Green light? from whom? what happens if you do not get the go signal?]

We are aware that the previous owners of Paymex have made a complaint against the BNZ through the Banking Ombudsman as they believed that they were operating a Trust Account in the true sense of the word. They are attempting to get back funds to customers who are owed. They will be in touch with those affected customers once they have new information.

[who are the previous owners? are any of those individuals associated with the “new owners”? How long will the funds take to be restored? why are you not guaranteeing them? How much money are you putting in to fund this?]

In the meantime, we appreciate your patience and loyalty.

[why the heck should we be at all loyal? once bitten…]

We aim to be able to provide with a new and improved Paymex very soon.

All further enquiries can be directed to enquiry@paymex.co.nz.

[how about a person’s name, and even a phone number instead of an anonymous mailbox?]

Goodbye Autotrader

It was an empire. If you wanted to sell a car, then Autotrader was the place. Dealers paid huge monthly payments, and AutoTrader took home giant profits.

When Trade Me entered the market AutoTrader was unable or unwilling to react online – their online offering was appalling. Inside Trade Me we used to say we were blessed with incompetent competition.

Now, sadly, the AutoTrader print publication has ceased to exist, and that online market opportunity is long gone. If you want to buy or sell a used car in New Zealand, then the market is on Trade Me.

It’s a great lesson to incumbants across all industries – when discontinuities happen you must change or risk losing everything. AutoTrader should have known this lesson – after all  they were the change that the previous marketplaces had failed to react to.

Change can mean serious revenue loss, at least in the short term, but at risk is the loss of everything.

Unigo: Universities by students for prospective students

Simple. So simple. Via an excellent NYTimes article comes news of Unigo, a site where current students talk about their universities, and where those comments are edited, grouped and displayed for prospective students to browse.

The competition, such as the Princeton Review and the US New & World Report, are mired in the past – they have books or issues released yearly that have terse summaries about each university. They cannot compete with the sheer quantity of text, the home videos shot by students (the site gave free cameras to student contributers) and the age of the contributors. It remains to see whther this will take off, but a long NYTimes article is certainly a sign that they are pros.

Someone should do this for New Zealand.

Economic Judgement Day: 2008 edition

Markets have them all the time, and it is finally here – judgment day. The day when lousy economics and fundamentals get confronted with harsh reality and bright lights. Prices plummet, businesses fail and jobs and economies fall.

My portfolio was hedged against this day – indeed it even went up, though not to the giddy heights of earlier in the year.

There is a great explanation via the Freakonomic Blog of recent events. I won’t even paraphrase The Recent Financial Upheavals, but it is an excellent.

Who knew this was coming? Well economist Nouriel Roubini (subscribe to his emails at RGEMonitor.com) has been consistently right, along with global motorcycle rider and ex Soros partner Jim Rogers (He even moved to Singapore and has been huge on commodities for the last few years), Warren Buffet (went shopping in Europe, and has been predicting this sort of thing for a while), and Yale’s Robert Shiller.

You won’t find too much of these contrarian guys in the financial newspapers – at least not until recently, and with the exception of Warren Buffet, whose advice people listen to and ignore. His Berkshire Hathaway shares have risen nicely over the last few weeks.

Goodbye Paymex?

As Jandal (JamesTurner) and Sam have commented it looks like online payments provider Paymex has faltered, or folded.

Word on the street is Paymex is dead and gone as of 27/9/2008 (Jandal)

Yes Paymex is gone, taking my money with it, supposedly its now caught up with BNZ..” Sam

and

Paymex looks ok, but who the heck are they anyway? (me)

[all three comments are in or on the orginal post ]

The website hints at a hiatus only.

This online payments thing just seems to be so pointless and the products belaboured. Paypal have messed up their product so much that it is no longer trusted by merchants, and everyone including them seems to put too many usability barriers in place.

Trade Me’s implementation of Pay Now (free for buyers) is slick and simple. Just keep the fees down chaps and there is no reason or critical mass for any other payments system to exist in NZ.

As for eBay – as mentioned before they’d be better off selling PayPal (and Skype) and opening their markets up to Google Checkout and other payment systems.

Time to return

From beautiful Cape Leveque, which is North is Broome, I woke in my tent to the dawn light. After visiting a local community, it is time to return.

The day before I fielded several phone calls from companies I am involved with, received the final investment documents and call for cash for a new one, confirmed a few weeks worth of consulting and failed to sign 2 important bits of paper.
Sadly the iphone isn’t up to reading investment documents written by overly verbose lawyers, nor to receiving lease documents, printing them out and signing.
Time to return.

Australia is big, really big, but those deserts are not empty of life. Sadly though many/most of the Aboriginal communities are closed off, so the cultural experience gets reduced to quirky roadhouse proprietors and their deep fried food. It’s about 2800km from Cape Leveque to Perth, and the bike picture below is just after the first 100km of sandy road, which was great fun. Sadly what remains is long, straight and Tarmac. It is a battle between distance per day, tire life, weariness and bike condition. This isn’t why I travel by motorcycle, I live for mountains, corners and cultures. The desert roads were great challenges though, but I am trapped in the NorthWest corner. Time to return.

Perth here I come.
I expect to be there in a few days, in NZ for the beginning of October and back in Perth for the end of October/beginning of November.

It’s dawn on the second day of the trip home. Time to get up and go.

Signs of WA

Two interesting signs, showing that yes, you are in Western Australia.

The first $22 per hour for cleaners. Despite these rates (similar for waiting tables) travellers tend to stay only a few weeks and then move on. Indeed folk arriving in, say, Broome can pick up a decent paying job within a day.

The second speaks to the kind of people around. It seems the camel hire business is a lot tougher than it would otherwise seem.

Running low on fuel….

Forty degrees Celcius in the sun, and I realized that I was probably not going to make it to the next gas station if I kept going to the latest gorge.

So I turned around and headed for Derby, on the west of the Gibb River Road.

Slowing right down, and with pumped up hard tires, I crept along, eyeing the rapidly falling levels in the translucent 45 litre tanks.

Finally I made it – and promptly deposited 46.5 litres in those 45l tanks. I even had a litre or two to spare.

Sadly though that 46.5 litres got me just 600km, a pretty appalling economy rate, even on the sand and dirt roads.

I will check the air filters, most likely a bit more air will help things a bit, but that’s a huge issue for the longer trips on the KTM.

Bad Aussie Food

Halls Creek, a cross road between the Tanami Track, and the main route East, and base for a few mines, along with gateway to the Bungle Bungles.
This is the $22 breakfast at the local hotel, the second best of 2 in town. Along with the instant coffee, the reconstituted and cold scrambled eggs, atrophied cold tomatoes, greasy cold bacon and dubious bread it was a pretty dismal experience.

Breakfast a few days later was 2 snickers bars, a 2 hour hike/gorge swim and a cold can of corn. Much better!