Public Mobile: No case for being
I am concerned that Public Mobile is sunk, and that their business model will not hold. Here is why… they are pursuing a low cost model but do not have the subscriber volume to sustain it.
With low cost business models the general pattern is to limit selection and then drive up volume. This allows you to crush your unit costs and pass the savings onto your clients. In the case of Public Mobile I am not sure that it is happening.
Their oddball frequency spectrum limits their selection of phones. They didn’t choose their phones so much as their frequency drove them to their very limited selection with likely limited volumes. The phones don’t look particularly cheap given the feature set and little known name brand. I wouldn’t be surprised if this isn’t happening on the equipment side. Low volume, high specialization orders tend to cost more.
Next problem is that they don’t have too many customers. This doesn’t allow the company to spread the costs around too much. Given that their larger rivals WIND and Mobilicity are likely losing money, this means Public Mobile is probably bleeding cash.
The worst problem is that nothing is happening that would change this state of affairs. They are not running a substantial advertising campaign, have a weak retail presence in the market, and an undifferentiated product.
It will be interesting to see how long they can hold out.
Sales Meetings…
I am in the midst of planning a sales meeting. Actually I am planning a couple of them. Both of them involve about three times the amount of travel as the actual duration of the 2 to 3 hour meeting itself. It may sound irrational that I am spending so much time stuck in airports or in planes for a couple of hours of facetime.
Here is why I am doing it. I am treating the couple of hours as an investment. I think that most people like to know who they are doing business with. I like being more than a voice in the ether. I want people to know what I look like, so that they are less likely to yell at me. I know myself that visiting my supplier and spending a meal with him let me know more than what a phone call could have.
80% of human communication is non-verbal. It’s important every so often to remember that, and get out of the office and meet your world.
Can’t Compete, no problem, try to Suck in Government
When a company is in trouble they often blame governments or policies for their ills. This is a last gasp of the pathetic CEO. Look at WIND Mobiles policy complaints here. The wireless policy in Canada is not so different than it was in the early eighties for Long Distance. The incumbents had very big advantages that took years to break. WIND Mobile new the market when it entered and now that its business plan is not working to its satisfaction let the whining begin.
Other business leaders are looking for government to subsidize their activities. They want Canada to favour some industries over others. This annoys me to no end. If government favours the auto sector for example it means taxes are higher for every other sector and startup activity goes into decline. Here is a good article in the post describing what the CAW is up to: link
Gateway web site: The ultimate Clone
Here is a company so keen on being a clone that it even duplicated the web site of the market leader Apple.
Compare these two websites: Gateway Vs. Apple
I am so impressed by the sheer patheticness of Gateway to clone a web site to that degree. Maybe they are just following Geoffrey Moore’s “Gorrillas, Chimps and Monkey” strategy to the extreme. Gateway is executing on the Monkey strategy here. The Monkey strategy means that you do not invent anything new, you clone what your competitors do, your customers accept that you will never be first to market with anything innovative, but because your R&D is lower and you are taking fewer risks you can pass on lower costs. Gateway is too lazy even to come up with their own web design. Long live the clones, long live the followers and long live Gateway.
Marketing Education: Stop Stealing Dreams a Review
I just finished reading Seth Godin’s “Stop Stealing Dreams”, you can get a copy here
Being Canadian, a good education does not yet cost a quarter million dollars, but it still is a significant investment. I liked his view that universities are often ossified institutions which have not advanced their teaching methods since… well since forever. Likewise in the face of teachers strikes or at a minimum some labour disruption in Ontario, I thought his views of how poorly high schools were serving us were spot on.
Learning institutions, ranging from libraries, high schools and universities, are all in the spot light for how poorly they have adapted to the digital age and how they lack relevancy beyond providing creditials and pre-screening for employers.
Ontario, my home province, is adding teachers to the payroll at a time of declining student enrollment. The premier is justifying the decision by claiming that more time in school for kindergarten will improve student performance even though there is no evidence to support the claim. Classes sizes are being kept small, again the reasoning is that this will improve student performance. To me, and almost to back up Seth Godin’s arguments, this merely points to the increasingly poor productivity in the education sector.
The e-book pointed to a coming crisis in higher education, because the prices in the U.S. have a reached a point where the costs out weigh the benefits of the degree. I agree with Seth Godin on this, and this is not an outlier opinion as I have seen a lot of opinions on student debt being way too high, but I would go higher and make the claim that teacher salaries and teachers pensions are raising the costs of public education beyond the ability of taxpayers to fund these programs. I would not be surprised to see more voucher systems emerge and begin challenging public school boards with competition from charter schools.
All in all, I recommend the Stop Stealing Dreams, for the original ideas.
