Wednesday, August 19, 2009

I'm too sexy for my product

Yesterday I was emailed out of the blue by someone from an agency working with Virgin Media on its "Powerful Stuff" campaign, and asking for feedback on the commercial embedded below. I personally think that with reviews it always pays to be careful what you wish for. As a piece of creative it's fine - nicely shot, etc., but it's an elaborately staged yet unimaginative pun (50 Megs, get it? Get it?). Cute, but pointless, and it does nothing to convey the sort of message this company should be telling regarding its competitive strengths.

Despite telcos' repeated attempts to make it something other than an enabling utility, ultimately broadband should be as sexy and thrilling as electricity, water or a tin of Ronseal. The benchmark of success is that it is available and reliable when people need it, and hopefully reasonably priced yet profitable as a business. You turn it on, and it works. And that's certainly something customers should be thankful for, but not excited about. It's a pretty sad comment on broadband development to date that, much like the British rail transport system, people express excitement on the rare occasion when it actually works as intended.

Null points!

Monday, August 17, 2009

Back on the block

I was away in the country last week and spent as little time online as possible. Back now, and with a lot of catching up to do. It's comforting to see that some things back in South London never change. This is Forest Hill Road near Mundania Road, in SE22.

Friday, August 07, 2009

The tracks of my tears

Azeem has an awesome post on VC fund returns, which I highly recommend, and hats off to CalPERS for keeping everyone honest. Our merry band is generally interested in more mature businesses which are under stress, usually due to inappropriate capital structures dating from the most aggressive vintage of the LBO contagion.

When looking at opportunities in this space, it's always helpful to try to get some insight into the states of mind and motivations of the relevant private equity sponsors, though this is often difficult given the veil of secrecy surrounding the industry. So after reading Azeem's post, I was interested to also discover in CalPERS' site a similar table of private equity fund performance, which like the VC table, is not all-encompassing, but is pretty damned comprehensive, especially when one considers that typically these numbers would not be seen outside the relatively small group of insiders/investors.

There are some stunningly bad IRR numbers to be found here, and I only count 34 funds from the 2005 - 2008 time frame in positive territory, and among those who are down, they are often waaaaay down. Conversely, there is only a handful of funds from the pre-2004 vintages in negative territory. It would be nice to think that the critical issue for the 2005 - 2008 vintage funds is time and a turn in the economic cycle (to break out of the trough in the J-curve), but I'm far from convinced. I would be interested to see a comparison of leverage in pre- and post-2004 deals (no doubt a good academic research project for someone with the time and resources), because my suspicion is that the use of leverage in the '05 - '07 period was, as in the broader economy, freakishly supersized - a last gasp of excess before the lights went out - and that this will preclude many of these deals from ever generating a return. And God only knows what happens to some of these deals if LIBOR/EURIBOR are markedly higher in two to three years' time, which I suspect may be the case.

Thursday, August 06, 2009

Looking for a datacenter?

Just got a notification that these guys are following my Twitter feed, so I went to their site, Data Center Map, which is very cool, so check it out.

More depressing data points for old media

At the risk of piling on the agony, Le Monde has a nice piece today on the decline of print media within household budgets in France (Google translation here), including this chart showing huge declines for newspapers and books - but keep in mind the last data point is 2005, arguably when the real pain was just beginning. Elsewhere, a colleague noticed a good example of a relatively "uncool" industry seemingly getting the structural shift - UK housebuilder TaylorWimpey's results presentation yesterday (see slide 15) contained a pledge to cut classified ad spending in half (to slightly less than 1/3 of total marketing spend, in favor of online.

Virtual coffee break - 6th August 2009

OFCOM's latest update on the UK market is out, and no doubt it will prove an interesting read, when I get a moment. Among the headline points, it seems clear that survey respondents would rather lose a limb than cut back on telecom spending, a somewhat unsurprising conclusion, and one which I tried to stress repeatedly during my Telco 2.0 series last year/early this year. A couple of other headline-grabbers are that 21% of internet users have had some experience with VoIP (a 50% increase YoY), and that apparently half of UK internet users (that's 19m people) are on Facebook.

This latter point contains an interesting sub-plot, which is that the proportion of respondents 15 - 24 who claimed to have a profile on a social networking site actually fell from 55% to 50%. Maybe they're shifting to anti-social networking, from Bebo to ASBO, as it were. Or maybe they see the herd of more mature users invading their space and fear being bombarded by ads for laser corrective surgery or invitations to become fans of hip replacement surgery. Churn, baby, churn.

The release of these findings today is ironic to me, coming on the same day as I received a Facebook friend request from a relative in Texas in her mid-60's, and also as ITV, the embarrassing uncle in mid-life crisis desperately in search of a way to remain relevant, gave up the ghost on Friends Reunited. But only after paying a £55m earn-out earlier this year - ouch.

Wednesday, August 05, 2009

So, who's the online video daddy?

Yep, you got it. Nice timing to boot.

Into Africa

This post to the NANOG list struck a chord, as it seems to demonstrate, in near real-time, the dramatic effects that better and cheaper connectivity can have on a market, in this case Kenya. I will look forward to following the responses from the list.

Things I thought I'd never live to see, part 1

An IPO, in the US of all places, for The Pirate Bay? What next, a strategic investment by Universal Music, Time Warner and NewsCorp?