Weatherston Guilty of murder – before jury returns

Complete with quotes from the family – here is, via Google,  premature article from The Press on Weatherston’s guilty murder verdict. (Hat Tip to @rachel_a) Accidents do happen in the editorial room (I’ve done it myself) and as these things go it’s not a bad one. It was published at 11:45, which was, it seems, the time when the jury went off to decide on the case.

It’s an insight to the rather rough world of journalism, which is even fiercer online. The newspapers and other media battle hard to be the first with the news – and it pays off in readership and respect. That means pre-written articles and occasionally getting things wrong. at least yanking this article was cheaper than stopping the presses.

And here is the current home page. Note the time. The jury is still out.

Posted in NZ Business | Tagged , , , | 6 Comments

Tuesday Three: 3 ways to improve your business

Are you brave enough to kill the dinosaur?

  1. Kill SAP, PeopleSoft, Oracle or whatever big system you use. Let’s face it you aren’t actually saving money by using it, everyone hates it and it costs a fortune to own in fees, upgrades and training. Get each department to run their own books – using Xero, with the corporate center aggregating them all up. (Is anyone brave enough to do this? – I’ve seen a multi-billion dollar company successfully run it self using one page spreadsheets)
  2. Use wordpress, joomla, silverstripe or any other free content management software for your internal and external websites. Give access to everybody and stop filtering.
  3. Buy your airfares at the last minute – you’ll sometimes get bargains and give yourself the best flexibility
Posted in NZ Business | Tagged , | 3 Comments

The NBR is in trouble – what should they do?

I’ve been really impressed with the NBR in recent times – their website was going from strength to strength, and their writing was increasingly excellent.

I even praised writer Chis Keall, who writes for (but I understand is not employed by Chris tells me he is, in fact, employed by NBR – my apologies) the NBR for his handling of the Vodafone/Telecom suit over filtering of their 3G networks.

NBR in turn praised Chris by placing a one page advertisement on page 14 of the June 19th edition. They even quoted me, “technology commentator, Lance Wiggs” from that very post:  The XT network debacle – Winners and Losers. Quoting bloggers – whatever next?

Why is this relevant?

Yesterday we heard that NBR has decided to make about 20% of their website subscription only, charging an impressive $298 per year for the privilege. (The oft-quoted $89 is for six months, and an introductory rate only)

This is a troubling decision on a number of levels. Let’s look at NBR’s letter, and then at why NBR has made this move.

There has been endless discussion for a number of years about the crazy model adopted by newspapers in most parts of the free world in which they pay the enormous costs of running professional newsrooms only to give their content away free – while at the same time slashing newsroom numbers to save money as circulation and advertising revenues fall.

Clearly the model is changing – but there is an answer, and it is ably provided by NBR.co.nz’s competitor – interest.co.nz. They keep the overheads to a minimum, use modern technology to eliminate the archaic newsroom practices and deliver timely, high quality and original content with great journalism and analytics. NBR may or may not have changed their newsroom practices to reflect the modern era – but until they do so they will struggle to be profitable. The process of getting news, from finding the facts through to publishing on the web or in print should be simple these days. Ask Idealog about print, and I refer again to interest.co.nz for how to do it for the web.

And to add to the madness it has been the aggregators that have profited the most from the supply of that free news copy.

This is an indication that the NBR leaders don’t really understand the current news internet business model. The aggregators, such as google news, are driving traffic to the NBR site, and without them the NBR would be even worse of than it is. By locking them out of the subscription area NBR will dramatically reduce their ability to make their compelling, orginal and timely content available to the world. The writers behind the wall will lose relevance, and the newspaper itself will diminish.

Google News does not host advertisements on their home page (in NZ), so all they are doing is directing traffic to the best original content. If NBR has the best, fastest and highest quality content, then they will derive more traffic.

Speaking of traffic – here is how NBR is going – as you can see they have been growing steadily.
Net-ratings

I’m afraid to think about how this chart will look over the next few months.

Worse still the model has spawned a huge band of amateur, untrained, unqualified bloggers who have swarmed over the internet pouring out columns of unsubstantiated “facts” and hysterical opinion.

Beautiful phrasing, and guaranteed to get the aforementioned bloggers going. Cactus Kate, Whale Oil, and Julie Starr have plenty of commentary. I wonder, given Whale Oil’s profile in the SST last Sunday, whether there is a bit of emotional decision making happening here.

Meanwhile Whale Oil isn’t helping the NBR team to make rational choices when he wrote “Oh really Barry “Fucking” Colman? It is stuck in the mud old f**kers like you that are harming the media industry.”

Whale Oil’s colic words reflect rather sharply the impact that the NBR letter has on bloggers, and it is again an indictment on NBR’s understanding of how the internet works. Bloggers drive traffic to the NBR site – not a lot per blogger, but there are plenty of bloggers out there. Bloggers also pick up on great reporting, such as Chris Keall’s articles on Vodafone, add commentary and thus increase the reach and relevance of the source.

Most of these “citizen journalists” don’t have access to decision makers and are infamous for their biased and inaccurate reporting on almost any subject under the sun (while invariably criticising professional news coverage whose original material they depend on to base their diatribes).

Many bloggers have no advertisements, and all but one or two make a trivial amount of money. However all have access to the internet, all bring their own distinct background – often highly experienced – and all can find their own facts on the internet. A great blogger will parse the facts and opinions, add their own perspective and write compelling original content.

Meanwhile while some larger bloggers do have access to key decsion makers, and write well if not better than any newspaper journalists. They are the new competition. Sure many are biased but at least they are honest in their bias, often naming their site to reflect that.

But every newspaper has bias, particularly a business paper like the NBR. There is nothing wrong with that – I find, for example, that the WSJ content is superb, but their editorials are laughably right wingnut.

It is only a matter of time before the model collapses. The alternative is newsrooms decimated to the point of processing public relations handouts or unedited government propaganda from their fully staffed team of spin doctors.

Yes – the model will collapse – we can no longer afford the expansive, expensive and Byzantine daily processes  required in the cycle from writing to reading. Interest.co.nz is one model that has changed the approach – and there are plenty of others out there to replicate. I very much wonder whether NBR is facing legacy issues with cumbersome technology and processes, and that these are making costs unsustainable. The coming disruption to the newspaper and magazine industry means that the NBR along with Fairfax and APN will at some stage need to throw the old rulebook out.

Overseas the Wall Street Journal and The Australian Financial Review have successfully instigated subscriber paid policies for premium content and legendary publisher Rupert Murdoch has promised the days of the internet’s “free lunch” news service from his newspapers is about to end.

These are great examples, and yet don’t make the point.

I pay the WSJ US$151 per year, and for that I get the world’s best source for global market news. It’s often the fastest, almost always amongst the best written and the analysis is superb. They are also, well, the Wall Street Journal, and the paper of record that everyone who is anyone in finance and business has to read. It’s no wonder they are successful online.

The AFR offers little – their website is unusable and their prices, at AU$1308 per year are not even close to passing the giggle test. Their content is blocked off from the rest of the web, and, well nobody really cares about them except for The Australian, which has picked up the traffic.

Murdoch’s News Corp owns the WSJ, and as a paper of record he has the ability to charge a price – but note the price that he charges are low in relation to the quantity and quality of content, and the market dominance of Dow Jones.

The NYTimes, also a paper of record, failed in its attempts at a paid model – all it did was to hide their most insightful writers and opinion formers behind the wall and reduce the influence, traffic and relevance of the newspaper. I would compare NBR’s approach to this, though NBR is a niche paper with circulation of 10,000 and daily unique browsers that has just risen over 7,000.

At $298 NBR’s price for 20% of their content is laughably high – and I question what percentage of those 7000 daily browsers (let’s say 5000 people) will actually convert. It will probably be over 1% (50) but almost surely under 10% (500). Even 50 people at $400 per year is only $20,000 – which is a handful of advertisements worth of income. Wouldn’t it be better to keep the readership growth and concentrate on selling the advertisements?

Overall this makes the website less attractive, makes marginal revenue and most of all it is hiding the decent content that differentiates NBR from other sites.

Why is this happening?

Our move to Subscriber Only Content has been driven by our belief that laying off journalists as a cost-cutting tactic is a route to oblivion for newspapers. I know there have been previous attempts by New Zealand publishers to charge for their news and these have failed and left them so far scared to attempt new initiatives.

Colman seems to believe that laying off journos is the only alternative. As I mentioned above, I suggest he look to his other costs first – keep the journalists but redesign the processes so that much less cost and time stands between writer and page.

But that’s not the real story here. The answer to why NBR is instigating pricing lies back in that one page self-congratulatory advertisement above.

NBR isn’t selling enough advertising.

I suspect that the one page ad was a bit last minute – as neither Bill Bennett (who was quoted far more extensively than me) nor myself were contacted by the paper. Was the page was kept aside for a paid advertisement, with the NBR sales team unable to sell it? Is the number of advertisements and the amount paid per advertisement falling? The answer to that second question is almost certainly yes – these are tough times.

Meanwhile back in 2006 NBR had circulation of 12,394 (to Sept-06), while the latest figures show circulation of just 10,772 to Dec 2008 – a 13% drop. I strongly suspect that NBR has seen circulation continue to drop, and sharply, in calendar year 2009.

It’s not hard to see why – the cover price is astonishing – $9.50 per copy at the news stands, and an annual subscription will set you back $456. That doesn’t, by the way, appear to include the $298 in annual fees to access the website, so NBR is asking you for an outrageous $756 per year, or $14.50 per week.

As they so able report, there is a recession on, and every item is being looked at by individuals and businesses. Even I struggled (and failed) to justify subscribing to the NBR paper.

So let’s recap.

  1. Subscriptions are down – and the price is far too high
  2. Advertising volume is probably down due to the recession and drop in circulation
  3. Costs appear to be high (a wild guess based on inference from Coleman’s letter)

Therefore NBR is most likely facing some significant financial issues – they need to turn the profit situation around, and probably need to do it fast.

Meanwhile Whale Oil and the like have made NBR leaders angry, and compounded with a narrow understanding of the internet news space, the decision was made to start charging for content.

It’s really sad – NBR’s website was going from strength to strength and their writing was becoming more relevant. I for one will miss them.

Here is my take on what the media players could do – it’s unconsidered free advice

Fairfax and APN: Hire Chris Keall and any other top flight journalists, create longer more analytical business articles, published in HOS, The Business Herald, SST, The Independent and on NZHerald/Stuff.

Interest.co.nz: Extend into NBR’s space – grabbing 2 or 3 top journalists from NBR

NBR: Reduce production (not journalism) costs sharply, make the website free again and ramp up advertising sales efforts. Consider dropping the cover price of the newspaper and definitely offer crisper deals for subscribers. Oh – and hire Chris Keall properly.<Turns out Chris is already hired – my apologies>

Readers: Don’t subscribe to the NBR’s newspaper (too expensive) and definately do not subscribe to NBR’s website. Keep reading blogs though.

Posted in Business, media, NZ Business | Tagged , , , | 36 Comments

When bureaucracy goes wild

The USA’s tax code is wildly complicated, and that means that the sheer act of understanding exactly how much you owe for your business and personal tax takes a lot of work.

It’s administered by the Inland Revenue Service – who do their best to help with compliance, but have a reputation for being inefficient.

How inefficient?

Well – these pictures are of most of the 26 identical letters that arrived for me en-masse yesterday. They are all from the IRS, all posted from inside New Zealand via airmail and all ask for my latest address details.

The letters are truly identical – the letter number, dates, codes and so forth. The envelopes are the same but the stamps are stuck on with what seems to be a less than machine perfect process.

The fact that I received them indicates to me that those address details are just fine.

I last lived in the USA in 2001, and am not a US citizen.

Posted in Business | Tagged , | 3 Comments

Making sure you make money from your business

These are notes from a whiteboard session that I led at BarCamp on Saturday. There were plenty of people in the room for the end of day session, and we had an excellent discussion.

We were trying to answer the question of how to make sure to make money from your business, and so we started with the bigger question:

Why do we start businesses?

It took a little while before my favorite answer came back – which is “to change the world“. My next favorites were variations on to “fix a frustration” or “solve a problem” and I was also really pleased to hear “to have fun”, which has to be included in any business.

It was a trick question of course, given the title of the session, and naturally we heard pretty early on that we start businesses “to make money”, or “to get financial freedom”. That may be so, but unless we want to fix a problem, change the world or create something cool then the money will be a distant dream.

Final kudos for the most honest answer, which was “because we can’t find a job”, or, as I put it, “because we are unemployable.”

The next question was What are the things you need to make sure you make money?

The answer was to make sure your company makes money, and to make sure you make money out of your company. We didn’t really get to the second part of that, but the first part created some good discussion.

The first answer from the group was a goodie – “Don’t spend money”. That’s directionally correct but first of all you do need to actually earn some. Indeed the answer to this question is simple – “earn more than you spend

Above all you want to earn excess money – so called economic rent, whereby you have an ‘unfair’ advantage over competitors. You do this in a number of ways, but I like thinking of Microsoft and Apple as exemplars of the art of being able to charge more than a ‘market’ price. Microsoft does it through it’s market domination – the network effect, owning standards, first mover advantage with Word, cutting the right deal with IBM and so on – the list is legion. Apple does many of the same things, but adds a product development process and company that keeps delivering stunning products well before their competitors.

But back to costs. While you do need to invest, I’ve always felt that the golden rule is to treat any money the company has as you would your own. That doesn’t mean you should spend it all on taxis, beer and dinners, but to watch every penny.

That means no fancy office or chairs – but use your kitchen table or a succession of cafes. It means no high salaries, but working full time while you develop at nights and in weekends.

It means being stingy about everything that isn’t core to the success of the business – and pay with equity wherever you can.

Once you are full time then you will need to pay yourself, but make sure the business can support it and pay yourself the bare minimum to live. As the company becomes more solid start paying others and gradually move the salaries up to a fair wage for each role. Don’t overpay yourself as there are other shareholders that have a right to the profit stream.

It is important that you bring the right people with you. You’ll need  mix of skills and experience to succeed – and you probably don’t have all of those yourself. Even if you do, as you grow you’ll need help. So bring others in early, give them shares in the company and then each person can do the things they enjoy, that they are good at and that they are willing to do for fun and equity rather than cash.

Ultimately it’s much more fun making money with a group than on your own, and you can each own a fair share of the business and enjoy the success. The share should reflect the value of each person’s input into the business, be it in time, expertise, money or access to things that can make a difference.

You do need to protect your shareholding though the investment rounds. This means messing with contracts and clauses one you get investment, but get it right and keep it simple. Make sure there is approximate balance between inputs and shareholdings – and don’t be afraid to tweak early to avoid conflict later.

Avoid investments that come with too many strings, and especially avoid investments that ask you to pay the investors high fees for things like office space, advice, directors fees and so on before you can really afford them.

When it is time to exit you want to sell to the company or person that has the most to gain by buying you. You could be encroaching upon their space, or they may have a distribution network that can massively increase your sales and so your company value. You should always know who these potential purchasers are, and get to know them well before time.

Once you have had a serious offer then you are ‘in play’, and you want to try to create an auction situation where purchasers are bidding against each other. Hopefully you have a decent board and are getting good advice.

Finally at each stage, and you are investing by stage right, don’t be afraid to decide to stop. Not everyone creates Microsoft every time, and so it’s vital to recognise when the effort isn’t matching the potential reward and to exit gracefully. There are plenty more opportunities out there.

Posted in Business, Internet Business, Investing | Tagged , , | 5 Comments

Plenty of opportunity with Telecom’s XT bills

With iPhone pricing comparisons all the rage right now, I decided to have a first look at my Telecom XT Bill.

I knew this would be entertaining, but despite everything below there is a minor victory, in that I have actually managed to do view the bill online. This is big win versus Telstra and Vodafone’s somewhat unusable websites.

First I had to get my account number from the latest bill (which is at my accountant’s office, aka Mum’s desk). I find it somewhat amusing that I naturally chose to Skype my parents to get that number.

Then it was pretty simple to create a login and look at my bill. Well done Telecom.

However things got complicated when I started looking at the bill itself.

Firstly – what is “others” and why am I charged 46161.00 (mins, secs or units?), credited with 46146 and face a net charge $4.01? I assume that this has something to do with data – but what are the units? and why the $4.01 – did I go over my limit?

Next was the main piece of the bill – which looked about right. I chose the 180 minutes talk and 1 GB data plans.

It seems I signed up on the 4th of June, and this bill is for the period from then until the 31st of July. So one month is in arrears and one in advance. That seems normal, though why upon why I can’t sign up on the spot to have my credit card direct debited each month I will never fathom.

This memo bit says I made 595 IP Packet Data calls – which is not really useful, as I get charged for the amount of data I use, not the amount of data connections I make.

I’m pretty happy about the $1.92 in international calls – as I certainly made a lot of calls overseas, but given the 48 cents per minute rates to Australia charged for those calls I did make, I have long ago switched to Skype. Perhaps if international calls prices were reasonable?

The whole point of this exercise was to check that I am on the right data plan – am I using too much and getting close to the limit? or am I using too little and overpaying for unused services? I clicked on the broadband usage link on my Telecom account page:

Oh dear – I certainly am not using nothing. And I clicked around a bunch more – looking at previous month, current and so forth, and all to no avail. This chart below is particularly confusing as the bar is showing some usage, while the text shows 0 MB and there is no scale on the bar.

I then had a bit of a account spasm (there wasn’t a time delay) and encountered a very friendly message.

Invalid user account line null – does that mean the “valid user account line” was not null, that I am an invalid user? that we all need an invalid user account line? that the site has lost my login connection? The mind boggles.

I relogged in, and then noticed the URL for the main page for my account. How informationally useless:

But then – a miracle. I managed to click on something that gave me my data usage!

It seems that I used 282 MB from the 25th of June.

Intriguingly that data range has nothing whatsoever to do with my sign up date, account date or today’s date. I have no idea how much data was used before the 25th of June and so ultimately I remain confused. I was pleased to see that even on the 14th of July I am still tracking to stay well under the 1 GB limit for the 30 day period.

More details showed, well, more:

It’s pretty easy to tell when I was in Auckland over the last month. (note this is just iPhone use – no tethering as I use a Vodafone stick for that)

I then wondered why it took me so long to find the mysterious link, and went back to the main account page to see.

Here it is:

That bottom box is the culprit – the view more details line goes to zero data oblivion. The phone number shown on the drop down is my 021 mobile number, and so my expectation is that this will show my data usage.

Turns out it doesn’t – and so my guess is that this box is used for those who use Telecom for their landline broadband provider. In that case why place the box there, and more importantly why use my mobile number?

Let’s zoom out, and give Telecom some more feedback about this page. If you work for Telecom then click on the page to see it in larger format. If you want more – well my rates are pretty expensive, but you can call any number of usability experts in Wellington.

Those few changes will increase upsells, reduce confusion about data use (and allow you to upsell that as well) and get your bills paid earlier.

I’m not holding out much hope – as a giant Telco, indeed as a giant corporate, Telecom usually moves at a glacial pace.

I hold as an example this XT Pricing page, which I tweeted about the day it was launched, and @telecomnz quickly said they would look at fixing it. It’s been a long time since then and no change has occurred.

It’s just not hard to put 500/1Gb and 3 GB plans underneath the other data plans – so why not do it?


It can’t be hard to put 500/1Gb and 3 GB plans underneath the other data plans, and it’s yet another opportunity to upsell – so why not do it?

Posted in Business, Internet Business | Tagged , , , , | 2 Comments

How not to add twitter followers

There are plenty of ways not to add Twitter followers. Here is one:

Here is what she should have done, and still can do:

1: Used her real name. We like talking to people not bots or spammers – and I’d like to refer to you by name not “she”

2: Started a blog – and linked to it with her twitter profile and tweet. Described exactly what she is doing on that blog – including questions she wants answers, who she is targeting (what is a baby boomer anyway?) and where she is doing her MBA. A blog makes it personal, gives much more scope for telling us more about the project and yourself and is trivial to set up (wordpress.com). If we know what you are doing we are more likely to want to help

3: Not asked people to follow her on Twitter, asked a very few people for advice and never asked people to (RT) Re-Tweet the message. These are Twitter ettiquite no-nos. People understand that retweeting and following are behaviours that you would like, but ask for them at your peril.

Posted in media, NZ Business | 32 Comments