A press release yesterday announced a new small business ISP soon to come from Telecom. The new ISP, according to the release, will provide hosting, domain name registration, web design and SaaS applications.

Over on his blog, Lance has a few positive and a few negative comments on the service. Specifically he asks;

Hang on –  why on earth would we want to get Telecom to provide [design and hosting] services?

Domain names, well maybe. But develop websites? Telecom outsourced their own unmitigated disaster of a website, so why would we not use any number of the excellent NZ design and development shops?

As for hosting, well let’s see what Xero themselves do… Currently Xero is being hosted at Rackspace, in Houston Texas.

Hang on a moment Lance, two points here. Firstly you’re not comparing apples with apples. Building an e-commerce site of the size of Ferrit, or hosting an international SaaS app like Xero are very different from the design and hosting requirements of an SME – your comparison is spurious. Secondly let’s look at the original press release and see who this service is targeting;

the service will be aimed mainly at firms with fewer than 10 employees

We’re not talking bigger businesses here with the time or knowledge to source these services from a variety of different providers, we’re talking time and resource poor SMEs who just wish to obtain a web presence and move themselves from a very “offline” way of doing and being in business, to more of a connected one.

It’s easy for the geeks amongst us to set up our own sites, hosting and so on – but remember we’re not spending 12 hours a day building houses, running retail stores or driving delivery vans, as the target market for these products so obviously are.

Of course I’m a little biased as I’ve had a small part in the offerings that Telecom is announcing, but putting aside my personal interest for a moment, I believe that “one stop shops” where SMEs can go to source all of their online needs, are a smart (and needed) service.

Disclosure – Diversity Limited is a consultant to Telecom New Zealand and its subsidiaries.

Ben Kepes

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

  • “I believe that “one stop shops” where SMEs can go to source all of their online needs, are a smart (and needed) service.”

    All well and good, but since when is Telecom a company that can deliver relevant, cost effective and tailored solutions for personal or business?

    There are plenty of companies out there providing just these kind of services for small business. If Telecom’s track record is anything to go by in this area, adding a new service like website design to their ‘suite’ is just going to cause more cost and frustration for SMEs.

    Aside from that, why would they – it’s not exactly a lucrative business to provide small business websites!

  • I guess you’ll just have to watch this space Brenda



  • Sounds like portals, walled gardens and customer capture all over again.

    Businesses need high bandwidth at low cost and high reliability. The unfortunate thing about NZ is that most businesses don’t know that there is more to the Internet than ADSL…

  • I agree with Lance, on this one. Telecom doesn’t have a good track record with providing good value services, and in my opinion you have to be a small business to understand small businesses. I can imagine the pain an SME would have to go through to get their website updated with Telecom – phone call to a small pacific island, on hold for 30 minutes, fill out a form, fax it off, wait 5 working days…

    And on a related topic – the Telecom’s business website is horribly designed. I went on there the other day to sign up for a toll-free number but was greeted with a garish black/fluorescent design with no discernible navigation. I left the site quickly and am now a Telstra customer, who’s website was simple to navigate.

  • @Stuart – you’ll have to take my word for it that Telecom looks like they’re really trying to figure out how to understand small business. I’ll talk with you some more about this later on


  • Falafulu Fisi |

    Stuart said…
    I agree with Lance, on this one. Telecom doesn’t have a good track record with providing good value services, and in my opinion you have to be a small business to understand small businesses.

    Telecom is a private company. You’re free to use their services or don’t, simple as that.

  • “I agree with Lance, on this one. Telecom doesn’t have a good track record with providing good value services”

    Two things, 1) Stuart, this is a very broad brush buddy. Objectively, Telecom is no worse or better than its competitors. $10 txt, Business Time and even good old Xtra in its time were / are competitive. I beleive like all good companies, when strategically warranted they can deliver the goods.

    2) History is generally a good predictor of the past except where disruption occurs. (you can easily replace the word disruption with desperation).

    I think that the government effectively taking away the network would qualify as both

    Telecom is a very long way from perfect. The website is a dog, some of their products are too. But given the network investment fiasco there ain’t no other pony to back.

  • @Falafulu – I don’t really see your point, are you agreeing with me because I chose to not use their services? Or are you saying that we shouldn’t provide commentary on Telecom because they are a privately held company?

    @The UM – you’re right, it is a broad statement, but it’s not just my opinion either – I hear this from others often. Maybe Telecom can change for the better, but I still stand by my statement that you need to be a small business to understand small businesses.

  • Stuart,

    I get that you hear it alot. Given that Telecom has most of the customers its not surprising. I hear what you are saying about small business too, i believe you are correct to some degree. But there are many enormous companies providing services to small businesses.

    HP / Dell
    GE finance

    Perhaps what you are saying is that there needs to be some cultural empathy? or even a better understanding of small business requirements

  • Hey, it’s May now, this article dates back to March and I haven’t seen anything new on this initiative….what gives? Dead or alive?

  • Vic - Telecom |

    Victoria here from Telecom. Thanks for the comments here everyone, it’s great to see the level of interest in what we’re trying to achieve. Here’s an update on where we’re at.

    The new Telecom Business site has gone live, with information on all our services in a much easier to use format and can be found here http://www.telecombusinesshub.co.nz. We’ve had good feedback on this and are always keen for more. This is just the start. We’re in testing now for the next update which includes the domain and web services mentioned above and that will go live soon (sorry, can’t give exact dates and as you’ll know not everything goes smoothly in large scale technology projects!!) We have a lot more planned for this site. Concerns have been raised about our ability to understand and be relevant to business. We’ve been working with many smaller sized businesses over the past year, and have just confirmed 100 or so across the country that we’re working with directly on developing our services. So I guess what I’m saying is we want your feedback and if you’re interested in working more directly with us we’re keen as mustard.

    It’s clear that bloggers are critical and sceptical of our ability to deliver this and we’re held to a high standard. So we’re working very hard to make sure what is put out is robust and won’t disappoint therefore we’ve been testing, trialling and in beta for a whole lot of stuff. A couple of examples, not enough space to go through them all (!) – we’ve trialed a new approach to the broadband help desk for business customers and we’re hearing it’s way better so we’re working through moving it from trial to launch – we’ve also been in trials for Managed Desktop services and are learning heaps about how we bring this service to the NZ businesses.

    Re: SaaS, I’ve had a number of SaaS companies in NZ and internationally approach me based on March announcements. Personally, I’m conscious that this market has been tried before so taking learnings from the past, spending time internationally to see what’s driving success and working out how we support and make this market successful in NZ is critical. I continue to be blown away by the talent and entrepreneurship in this space.

    On a closing note, as they say proof of the pudding is in the eating and hopefully the fact that we’re watching and taking part in the conversation in the blogososphere space indicates our openess.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.