Archive for September, 2001

MIDDLE EASTCENTRAL ASIA – SEPTEMBER 2001

Saturday, September 1st, 2001

There is currently an increased interest in our reports on the Middle East and Central Asia, especially in the countries involved in the various conflicts. Country profiles that are hardly ever downloaded are now attracting interest.

We hope that the companies that are downloading this information find it useful, and that perhaps we can in this way – be it on a very limited scale – contribute to finding solutions, not only for the current conflict, but for the long-standing problem in countries such as Afghanistan, Palestine, Iraq, etc.

Information on these countries is extremely difficult to obtain, so any contributions from our readers would be most welcome.

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TELECOMMUNICATIONS AND AIRLINES- SEPTEMBER 2001

Saturday, September 1st, 2001

The Ansett crisis should be sending a very clear warning to the telecommunications industry. All of the elements that triggered the collapse of Ansett also exist in the telecommunications industry.

Like the telecommunications industry, the power in the airline industry is still very much in the hands of the incumbent. All matters to do with regulation and competition are heavily biased in favour of the incumbent. Most of the regulations put in place over the decades have been strongly influenced by Qantas, and the various ‘protections’ that have been introduced require very deep pockets indeed. To ‘interconnect’ with, and have access to, existing Australian airline facilities in airports around the country is costly and cumbersome. The cost structure of the Australian airline industry is therefore 20%-30% higher than in other, similar countries.

For a long period of time the airline duopoly worked well and Ansett was protected. However, as soon as real competition arrived the duopoly collapsed. In these circumstances it is often the duopolist that suffers the most, since they don’t have sufficient ‘fat’ to withstand the onslaught. Maintenance of the infrastructure is one of the largest cost elements; for a variety of reasons the Ansett investments have not been consistent or standardized, and these infrastructure problems produced the first cracks in the company some 3-5 years ago. This also became one of the key reasons for News Limited calling it quits. A far too eager Air New Zealand paid too much, making decisions that were ego-based rather than being in line with sound business principles.

Again like the telecommunications industry, it is not economically viable to duplicate the national airline network. Outside the major routes a much more shared airline facilities network is required and the government would have a role to play in this. In many cases such operations would generate little profit, but this does not mean that we should simply cut off all the non-profitable routes – a wealthy society like ours should be able to do better than that.

To highlight yet another parallel between the two industries, both AAPT and Optus are run by incumbents from other countries and both face problems in their home markets.

In the case of AAPT the similarities are frightening. Telecom New Zealand is faced with severe problems in its home market and in Australia AAPT is under enormous pressure from competition. Massive investments are required both at home and in Australia in order to make the transition from narrow band to broadband – this in the light of diminishing revenues and profits within the traditional voice-based markets. So, guess where Telecom’s (and, for that matter, the New Zealand government’s) allegiance will lie if they have to make similar decisions in the case of Air New Zealand?

The situation with Optus/SingTel will not be dissimilar. In relation to deregulation Singapore Telecom is today where Telstra was in 1996, so they still have some dramatic changes ahead of them, both at home and overseas. At a certain stage they will also have to face the music and might have to make some serious decisions about where to invest.

Look at the problems with the telco industry in Europe. Many of the overseas operations are currently being reorganised, streamlined or simply abandoned; most players are concentrating on their home markets. This trend happened in the USA as early as the mid-1990s. Despite all their overseas adventures and investments, very few telcos around the world can be called international operators. The financial experts should reflect on this. Telcos that have been able to maintain their shareholders value are, almost without exception, those telcos that have focused seriously on their home market and have made very significant (broadband) investments in their national (or, in the case of the USA, regional) networks.

Like the airlines, the telecommunications industry contains a very important national interest component. You can’t simply switch off the telecoms network as soon as the telco fails to deliver value to the shareholders. There is too much at stake.

The government has certainly let the airline industry down by not having the proper regulatory and competitive infrastructure in place and the writing is clearly on the wall for the telecommunications sector. Does the government want to see them fail? By the same token, the industry should realise that it is futile to rely on the government – it should take a far more leading role in forcing changes in the industry.

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IIA TO USE INTERNET TO REACH MILLIONS IN AUSTRALIAN POLITICAL FIRST – SEPTEMBER 2001

Saturday, September 1st, 2001

Australia’s national Internet industry body, the IIA, has announced a plan to use the Internet as a political lever to build support for online issues in the forthcoming federal election.

Senior strategists in the main political parties have been consulted and have given their unanimous support to the online campaign. The rationale behind the idea is that politicians are beginning to comprehend the power of the Internet as a communication tool and to understand the importance of being prepared to respond to the issues raised by the IIA.

The politicians have been told that a huge part of the electorate can be reached through the Internet, and the IIA claims it can ‘make our industry’s issues relevant to millions of voters in a non-partisan way’ – the Internet has been defined as ‘democracy in action’. Given the expected closeness of the election, it would be unwise of the contesting political parties to ignore this opportunity. It is no longer necessary to spend large amounts of money to reach the people; but it is necessary to have a clear message and well-defined strategies to present.

The IIA is focusing on the importance of the Net in carrying out political promises – for example, in the areas of education and health. And they see universal broadband as being crucial to the provision of online benefits, particularly in the sensitive regional areas that will be so important to the outcome of this election. Therefore broadband is perceived to be a major factor in the forthcoming debate.

The IIA online campaign will be enhanced by the 25,000km Tech Trek which has now begun. (see www.techtrek.tv). The Tech Trek will deliver key messages and conduct a widespread survey on the core needs of the Australian population, allowing the researchers to gain insights into the issues that are politically significant.

The IIA campaign will commence with five core demands:

– Making broadband Internet available for all Australians

– Stimulating investment in Australian broadband content

– Accelerating new digital services by deregulating the broadcasting sector

– Creating a safe and secure Internet for all Australians

– Removing discriminatory tax treatment as it applies to e-commerce.

A strong media interest in the campaign is anticipated. It is expected that many citizens who have felt excluded by the political process will take advantage of this chance to have a say in the shaping of their own destiny.

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THE OPEN GROUP – SEPTEMBER 2001

Saturday, September 1st, 2001

Open Group is a vendor-neutral member-driven international organisation which identifies its mission as being standards-based enterprise integration. It brings together technology vendors large and small in a unique collaborative environment with technology buyers as well as integrators and consultants, with the objective of creating a practical environment for:

– any-to-any connectivity

– ease of interoperability

– enhanced accessibility

– improved collaboration.

Members include: Intel, Cisco, IBM, Sun Microsystems, HP,Compaq, Hitachi, Siemens, Fujitsu, BMC, Microsoft, CA , Boeing, UK Post Office, DOD US, NASA, Barclays, Shell and a multitude of small- and medium-sized technology organisations, consultants and systems integrators specialising in several leading edge and niche technology areas.

In today’s fast-changing IT&T environment companies need to continually refine and add focus areas. Currently there are eight areas for cooperation and co-working:

– Security and E-commerce

– Architecture

– Wireless and Mobile Computing

– Enterprise Systems Management

– Directory Interoperability

– Quality of Service

– Server Platform

– Real time and Embedded Systems

Up until now the Open Group has been heavily focused in the northern hemisphere. Of late, however, with the goal of becoming a truly global organisation, it has begun to spread its wings over the Asia-Pacific region, initially choosing to focus strategically on India and Australia/ New Zealand.

Vish Viswanathan has taken the lead in assisting companies to pursue the many new opportunities that exist within our e-economy. I have known Vish for many years – back to the days when we discussing the forerunners (T-Ford models) of the current e-world – videotex, VANs and EDI. His regional leadership role in the Open Group; his vast network of contacts in the Asia Pacific Region and his in-depth knowledge of the e-business-driven developments within IT&T offer a unique opportunity for Australian and New Zealand organisations to become truly integrated into the global community.

One of the key benefits of the Open Group is that companies achieve real control over the destiny of their own activities in the fast-moving e-environment. This is a major issue for Austrian and New Zealand in particular, as local companies often simply operate as ‘slaves’ of their international operations or simply as ‘slaves’ of whatever is happening on the international scene. Access to advanced knowledge is another keystone.

The inaugural Open Group meeting for Australia and New Zealand is planned for 16 November 2001.

For more information contact Vish on: vish @primus.com.au Web: www.opengroup.org

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HALF A BILLION ONLINE – SEPTEMBER 2001

Saturday, September 1st, 2001

According to the Global Internet Trends Report from Neilsen//NetRatings, 459 million people worldwide have Internet access from their homes.

The at-home Internet population increased by 30 million users from the first to the second quarter of 2001. The report, which measured the Internet populations in 20 countries, found that the USA and Canada accounted for 40% of the world’s online audience in Q2 2001 – down from 41% in Q1 2001. The area of Europe, the Middle East and Africa accounted for 27%, which is static from the first quarter, followed by Asia-Pacific at 22%, and Latin America at 4%.

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