Leading digital lifestyle research group Park & Associates claims that the recent announcement that Walt Disney will offer programs for free from their Website is a large step forward for the adoption of IP video delivery.
David Richards
Dick Smith Online Set To Be More Of The Same Under Kogan
Online publicity junkie Ruslan Kogan who recently acquired the Dick Smith name and on-line web site is set to continue selling, notebooks, TV’s and smartphones products which research shows are in decline in Australia.
Kogan who refuses to open his books up for inspection claims that the future is not the “bibs and bobs” that made the originally Dick Smith famous and has led to major growth for Jaycar.
Speaking to Fairfax Media Kogan, who famously predicted that Apple was set to shaft Harvey Norman and JB Hi Fi by stopping them from selling Apple products in their stores a situation that never eventuated said that there is a future for the Dick Smith even if it based on selling the same products that led to failure for both Woolworths and Dick Smith stores.
Like the failed Dick Smith Stores, Kogan is now looking for investors, as he attempts to float his online operation, which is set to come under pressure from Amazon when it launches in Australia next year.
Kogan who likes to tell other people how to run their business has made a name for himself selling cheap made in China products which several of his customers have described as “junk” in online forums.
The Melbourne based operator claims that the acquisition of the Dick Smith brand could boost Kogan’s sales by at least 40 per cent.
He said “If they (accessories) were successful product lines for them years ago that doesn’t mean they’ll be successful product lines in 2016,” he said.
“Our approach to determining what products need to be sold is customer driven, based on systems we’ve developed internally that look at search statistics and Google search data,” he said.
“We look at what people are searching for, where is there demand, where are there pockets of opportunity, and we evaluate them on a line by line basis,” he said, including how much it would cost to get a product to a customer’s door and what its competitors were doing.
“Then we make a call on whether that’s a product that we want to do,” Mr Kogan said. “We often describe ourselves as a statistics business masquerading as a retailer.”
Mr Kogan says Kogan is better positioned than any other company to repair the Dick Smith brand and turn it into a profitable part of his $220 million business.
Both Harvey Norman, JB Hi Fi, The Good Guys and several overseas conglomerates rejected the brand after inspecting the Dick Smith books.
“We were both retailers and we both had consumer electronics at our core,” he said. “We would have dealt with similar suppliers whether it be private label contract manufacturers, or other brands.”
“With Dick Smith we instantly become more important to each of those suppliers and manufacturing partners.
ChannelNews understands that several vendors will not supply Kogan direct but instead force him to buy branded products from distributors whose prices are more expensive than the prices big brands negotiate with the likes of Harvey Norman and JB Hi Fi.
Kogan believes that now that he owns the Dick Smith brand he has “got even more leverage to negotiate better terms and that means we can get better prices and pass on a portion of those savings to the consumer,” he said.
He said Kogan had spent the last decade investing in and perfecting systems to make online retailing as efficient as possible. Customer ordering, for example, was fully automated, with no manual input from Kogan staff, while sophisticated algorithms ranked suppliers not only on price but speed of delivery and credit terms.
“All these efficiencies will instantly plug into the Dick Smith brand and leverage our existing investment in IT architecture – that’s how we’ll make it instantly profitable,” Mr Kogan said.
“The best way to rebuild a brand is to deliver on your promises, to ensure every customer gets exactly what they’re promised and to ensure their expectations are exceeded.” he told Fairfax.
Not surprisingly Kogan who does not file consolidated accounts with the corporate regulator is reluctant to talk about sales and earnings or to comment on a float.
Without providing any proof he claims Kogan’s sales are growing at a similar pace to those at JB Hi-Fi and Harvey Norman.
Kogan whose business is not tracked by GFK said “There’s no doubt that JB Hi-Fi and Harvey Norman and The Good Guys are bigger businesses than we are,” Mr Kogan said. “We are a brand that started with nothing 10 years ago, we’re relatively young, we are getting started – we are very optimistic about the future.”
Anchorage Capital Claims Dick Smith Was A Viable Business..”Pigs Arse”
COMMENT:The now failed Dick Smith retail business was” viable” and “absolutely” had a sustainable business model when it was floated on the share market for hundreds of millions, Anchorage Capital boss Philip Cave bleated to the Australian newspaper on Friday.
Seriously, Mr Cave, who are you kidding.
The business was a mess when you bought it and is still a mess today.
What Anchorage Capital have become are masters at applying lipstick on a pig.
What Anchorage Capital got away with was pure manipulation and the hiding of facts which the Australian Companies and Investment Commission are set to investigate.
What you did may be legal on paper but it was morally wrong.
Cave and his cronies, had one objective and that was to screw as much as they could from the deal for Anchorage Capital investors and then disappear.
It was not till Cave quit the board as Chairman and Rob Murray the former Lion Nathan executive took over, that the pack of cards at Dick Smith started to crumble.
While Cave was running the show Nick Aboud the former CEO was seen as the golden haired boy a person who in the eyes of Cave and his cronies could do nothing wrong.
The problem was that by the time Murray was bought on board the Company was a mess, costs were blowing out, suppliers were starting to get tetchy because of late payments and boatloads of unsalable house brand stock was arriving into Dick Smith warehouses.
Dick Smith was a train wreck and no one, had a clue how to stop the bleeding.
The smart executives in the group quit.
The facts are that on average a good JB Hi Fi, Harvey Norman, or Good Guys stores turns over $20M.
Dick Smith stores were struggling to make $3M.
Even Dick Smith stores in New Zealand were being jacked up and are still being jacked up today.
What Nick Aboud and Marketing Director Neil Merola did to cut costs in New Zealand was shift the operational side of the business back to Australia.
This allowed them to shift around $4M from the bottom line of the business which when added back into the cost of running the New Zealand business would show that the New Zealand business is not as profitable as Ferrier Hodgson the receivers at Dick Smith are making out.
In FY 2015 Dick Smith New Zealand had an EBITDA of $2M add back in $4M operational cost and the Dick Smith New Zealand stores could be a bigger mess than Australia which is why retailers such as JB Hi Fi, Harvey Norman or the Good Guys will not be bidding for them.
“It was a great model and it had a lot of opportunities to grow the business,” Cave, told The Weekend Australian.
Cave went on to claim that every single one of the Dick Smith were profitable, there were no loss-making stores, so was it a sustainable model? Absolutely” He said.
So why was it that arguments were taking place between Nick Aboud and store managers over “unprofitable” stores back in April and May 2015.
And why was it that stores like Dick Smith in North Sydney were being closed down.
Mr Cave also defended private equity practices and questioned the board’s decision to write down stock by $60 million.
Dick Smith collapsed on January 4 when its lenders – National Australia Bank and HSBC – withdrew support for the company following poor sales over Christmas.
That followed a profit downgrade in October and a $60m stock write down in October as well as a clearance sale ahead of the all-important holiday trading period.
Last week the receivers instructed Dick Smith stores to lift the price of house branded goods.
One NSW Dick Smith store manager said “I don’t know what is happening. We were selling audio cables for $5.00 and they were selling. Then we got instructions to lift the price to $25, now no one is buying the cables”.
He added “Most of our stock is house brand it’s either Move or Dick Smith branded and it is not selling. Take TV’s why would you buy a Dick Smith branded TV when the Company could not be around in a few weeks”.
Several observers have questioned how Dick Smith could go from reporting record profits in August to calling in administrators in the first days of January, and highlighted the huge profit Anchorage made buying and selling the business between August 2012 and December 2013.
Forager Funds Management called the deal, in which Anchorage bought the business for $94m in 2012 and floated it at the end of 2013 for $520m, “the greatest private equity heist of all time”.
But Mr Cave said he was disappointed with the “inflammatory tone and misleading nature” of commentary about the collapse and that “undeniable historical facts” about the business had been overlooked.
Mr Cave, who chaired the retailer in private ownership and through its first 14 months as a public company, said it was up to the board-appointed administrator, “not Anchorage or anyone else”, to determine the substantive reasons for Dick Smith’s collapse.
Forager investment analyst Matt Ryan, said that management was forced to borrow to build up stock levels after Anchorage ran them down from $370m to $170m ahead of selling the business.
As well as the inventory writedown, Anchorage put writedowns on onerous leases and other assets that reduced future charges and boosted profits in a way that would inflate the price they could onsell the business for.
A spokesman for Anchorage said while the balance of the purchase price was funded from cash generated by run-down sales of significant amounts of excess and slow-moving stock, it was incorrect to argue that this left the business needing to take on debt to rebuild inventory.
Dick Smith had cash and short-term receivables of $90m in December 2013 after the float and $95m in December 2014, when it remained debt-free, he said.
Anchorage said criticism of the increase in inventory to $293m at the end of 2015 failed to take into account the growth in store numbers – they increased by 25 per cent as a public company – and the change in business mix, with Dick Smith making a push into higher-margin home-brand product to balance the slim pickings from big brands.
The collapse has imperilled the jobs of more than 3000 employees and could see the long-established brand and its network of more than 300 stores collapse if it cannot be sold.
Already 11 people have been sacked from the accounts department according to a circular to staff by administrators yesterday.
Mr Cave said he hoped the brand would survive and the firm would work “constructively” to assist the administrator.
“Everyone at ACP shares the dismay felt by many in the community regarding the circumstances at Dick Smith,” he said.
This is a guy who along with AC, got $320M out of the Dick Smith float, while leaving hundreds of investors with worthless stock and over 3,000 staff now looking for a job.
UPDATED: Consumer Electronic Prices Crash Up to 33%
While petrol is going up consumer electronic prices are crashing with leading investment bank Citi Group claiming that the consumer electronic market is set to be impacted by continued price deflation and that the average selling price for CE goods has crashed up to 25%
New Microsoft Hardware Range
Microsoft has taken it right up to Logitech with a stunning new range of keyboards mouses and controllers.
In my opinion two of the most important tools when using a computer are the keyboard & mouse and more than likely they are the most abused from coffee and paper clips to being stuffed into bags along side a notebook. So it was interesting to sit down recently and listen to two Microsoft executives explain the rational behind a brand new range of very impressive Microsoft accessories spanning mice, keyboards and wireless gaming controls. There is even magnification technology that makes reading spreadsheets a breeze.
Among the new range are five new mice including a new generation of laser and optical mice which have been designed from the ground up for the conditions that a mobile user often finds themselves in. There is a new generation of ergonomic keyboards plus a new Media Center controller. And if that is not enough they have even launched a wirless Xbox 360 controller.
The process Microsoft goes through to deliver a new accessory range is not dissimilar to the way a car company builds a brand new car.
First there is the human behaviour research from electrodes on the body to the filming of users for weeks so that Microsoft engineers can understand precisely how we all use our accessories. Then comes the 3D modelling followed by the plastic models. At the same time Microsoft engineers are developing new chip capabilities that they say deliver faster more responsive accessories.
This time around Microsoft has delivered a new generation of software that allows for more functions including a really neat magnifier. This I believe is what sets Microsoft appart from any other keyboard or mouse vendor including Logitech. For example a new magnifier tool delivers real-time magnification on any section of the screen, making viewing and editing of hard-to-see text or pictures easier than ever. A new Tilt Wheel makes navigating and viewing documents, spreadsheets and images more efficient with four-way scrolling capabilities. And High Definition Optical Technology provides more precise, responsive and smoother tracking.
In addition Microsoft has developed new cutting-edge High Definition Optical and Laser Technology that they claim is two generations ahead of standard optical and laser mice and delivers advantages such as improved responsiveness – With 1,000 dpi (dots per inch)
Each of these High Definition mice delivers the right amount of responsiveness in relation to hand movement, requiring less hand motion_ in small spaces such as coffee tables or airplane trays.
Microsoft engineers have also achieved greater precision with a high definition mouse that captures 6,000 FPS (frames per second) to accurately track hand movement to prevent stopping or skipping, even when moving very quickly. The mouse engine operates at a higher processing power which enables the mouse to do more in less time.
All of the new high definition mice are equipped with a state-of-the-art chip, which requires less power and maximises efficiency, delivering an average of more than six months of battery life.
Jeremy Hinton, Hardware Product Marketing Manager, at Microsoft Australia said. “More than ever before, people want higher performance from all types of products – from cell phones to TVs to cars,” he said
He added “We developed this exclusive line of high definition mice because higher-performance peripherals create a better PC experience. Our proprietary tracking technology, raise the bar for mouse performance.”
A recent study showed that notebook mouse users experience a lower incidence of pain compared with users who don’t use an external pointing device. Answering this need, Microsoft has introduced three new notebook mice.
These three new notebook mice are fitted with a new generation of smart navigational features including the new magnifier. The 6000 Mouse has a snap-in USB receiver
For desktop users Microsoft have a new wireless Laser Desktop set of mouse and keyboard. This desktop set, including a Wireless Laser Mouse 6000 and a Comfort Curve Keyboard design, is outfitted in a futuristic silver finish, adding style to any desktop. Features such as the new Magnifier tool and Tilt Wheel are included.
For Gamers: See next page.
A big new development from Microsoft’s hardware team is in the gaming arena and according to Microsoft they have been listening to what gamers want. “We heard from gamers that they wanted a mouse designed specifically for their PC gaming needs, equipped with features and functionality that optimised their game play,” said Jeremy Hinton, “We have answered that request with a perfect PC gaming solution: Laser Mouse 6000. Equipped with a thin, flexible cord for the feeling of wireless, gaming-specific software features, advanced laser technology and more, Laser Mouse 6000 will take gaming to a whole new level.”
Microsoft’s first wired laser mouse delivers greater precision and increased control. Its ergonomic design provides comfort, and the advanced laser technology delivers enhanced accuracy and performance. The 6000 model include a Precision Booster, enabling users to shift between ultra fast speed and precision control for targeting, and a Gaming Toggle that lets users easily switch between favourite weapons or program frequently used action sequences – all with the touch of a button.
A thin, flexible cord is the closest feeling to wireless while still having a wire. Say Microsoft. The scroll wheel with detents is great for desktop navigation and gaming, for amazingly accurate in-game weapons changing and scrolling. In addition, productivity-boosting features including a new Magnifier tool, for real-time enlargement and editing, deliver maximum efficiency on the PC.
Joining the Game Precision Series is a new Xbox 360 wireless controller which works with most Windows XP-based PCs and Xbox 360. Microsoft claims that it delivers a consistent and universal gaming experience across both of Microsoft’s gaming systems and eliminating the hassle of learning a new controller layout.
It also has two vibration feedback motors, improved ergonomic design, new left and right shoulder buttons and up to 25 percent higher resolution with an Analog to digital converter (ADC) compared with the original Xbox controller; enhanced precision and accuracy in both thumb sticks.
In all this is a very impressive range that not only looks good but includes some cutting edge technology where it counts right at your finger tips.
October 2005
Microsoft Wireless Optical Mouse 5000 – $79.95
November 2005
Microsoft Wireless Notebook Optical Mouse 4000 – $79.95
December 2005
Microsoft Wireless Notebook Laser Mouse 6000 – $99.95
Microsoft Notebook Optical Mouse 3000 – $49.95
Microsoft Wireless Laser Desktop 6000 – $199.95
Microsoft Wireless Laser Mouse 6000 – $129.95
*Prices are Australian recommended retail prices. Actual prices may vary.
Experts Claim That OLED TV Technology Is Expensive, & Not What It’s Cracked Up To Be
LG Display is set to tip $4 Billion dollars into a new OLED fabrication plant, market leader Samsung, Panasonic Sony along with several other brands, claim that OLED is not the future for high quality TV reproduction, which is why they are sticking with alternate technologies.
Sony claim that there are too many problems with the
production of OLED technology and that OLED TV’s have reliability issues and
are costly for what you get.
Reliability issues combined with the high costs of ramping
up production of OLED panels has most manufacturers investing heavily to improve 4K
UHD technology by widening the colour gamut and employing either Quantum Dot or
a similar film technology (Nano-Crystal in Samsung’s case) to enhance and
solidify colour.
The curved screen also helps to minimize the effects of
contrast degradation from side angles in LED backlit UHD TVs.
LG who are one of the
few Companies flogging OLED TV’s is struggling to shift volume sales of their
LG 65″ 4K Ultra HD OLED 3D Capable Smart Curved TV which is selling at
Harvey Norman for $8,495.
Earlier in the
year this TV was selling for $9,950. The Company did not make one of these TV’s
available for a side by side comparison.
At CES 2016 there is set to be a lot of debate around HDR 4K
content.
Interest in HDR (high dynamic range) 4K technology has
resulted in a wider discussion on whether OLED TV displays will be able to
handle the display characteristics of this new technology as it arrives.
OLED is expensive for what you get and while it delivers a
great picture it is hard to differentiate between a TV that is delivering an
SUHD image at half the price.
According to the TV expert’s OLED, while being
extraordinarily good at black reproduction and motion clarity due to its
ability to actually turn off its organic LEDs (OLEDS), isn’t quite going to be
capable of delivering the same brightness that normal LED TVs can provide.
Since one of the crucial components of HDR’s quality is its
expected brightness, this will possibly make the powerful technology of OLED
surprisingly deficient at delivering the extraordinary contrast of HDR when
compared to normal LED TVs.
In turn, this could affect these TVs ability to deliver the
expanded luminance and colour range that HDR promises.
According to Danny Tack, an expert from Philip’s European division
questioned by Forbes magazine in a recent blog post, the wide colour gamut and
much brighter light output of LCD are features that have a better position to
meet the demands of HDR than OLED does.
So far, as Tack explained to Forbes, OLED (and its primary
developer LG) have to first solve this light output issue before they can
really meet the standard of HDR and Tack doesn’t believe that this will happen
for at least two or three more years.
The point of this was underscored by some raw numbers behind
both technologies: Namely, while 4K LCD TVs have managed to increase light
output from 500 to 800 nits in just the last 12 months between 2014 and now,
OLED has only increased its capacity by 50 nits.
While this is understandable given the revolutionary and
difficult to manufacture nature of TVs with organic light emitting diodes, it
also shows how the technology might face problems with new HDR technology set to be released at CES 2016,
Samsung has also weighed in on the issue and claimed that
force driving the brightness of OED panels to levels that are bright enough to
handle HDR will likely also reduce those panels’ life spans dramatically. Given
the very high retail prices of OLED 4K TVs, this is something that potential
owners definitely won’t want to hear as they get ready for HDR content to
arrive from different 4K transmission services.
Clive Peeters Open To Take Over Offers
Clive Peeters CEO Greg Smith who today reported a 90% decline in profits has said that he is open to takeover offers or a major new investor. He has also said that the board is currently considering several incomplete proposals from competitors to buy out the Victorian based consumer electronics Company.
Clive Peeters CEO Greg Smith who today reported a 90% decline in profits has said that he is open to takeover offers or a major new investor. He has also said that the board is currently considering several incomplete proposals from competitors to buy out the Victorian based consumer electronics Company.
Speaking to ChannelNews today Smith said that he believed that many Companies will between now and July 1 when new dismissal laws come into effect in Australia lay off thousands of workers and that appliance and consumer electronic sales will not pick up till the September October period.
He said “60% of our business is appliances and this side of our business is down over 12% while our consumer electronics business is up over 5%”.
On the question of New South Wales he said that the Clive Peeters group was suffering because of a lack of stores and that the Company has plans for 12 new stores in that State.
He said “We are pleased that there is continued improvement coming through in NSW despite the very depressed conditions in that State”.
Sales in H1 in NSW 2009 fell 7.6% on the corresponding period of the previous year, the best performance of our eastern states operations. Our operating costs in Sydney were managed very carefully over the period and the final result was $1.6 million net operating loss after tax for H1 2009. This compared to the H2 2008 Sydney loss of $1.8 million after tax, and to the H1 2008 Sydney loss of $2.6m after tax, so we are encouraged by this trend.
“To grow we have to invest in NSW and this is a top priority for the board going forward”. Said Smith.
On the issue of Dick Smith Vs JB Hi Fi he said “I agree with the sentiment that Harvey Norman could get hurt if there is increased competition between the Woolworths owned Dick Smith group who do have money and JB Hi Fi. I also agree with the sentiment that Dick Smith stores are traditionally small and they do not have the same brand recognition as JB Hi Fi. For example JB Hi Fi shift a lot of small cheap stock similar to Dick Smith for example our average sale is $800 vs $80 for JB Hi Fi”.
Greg Smith added “with sales under significant pressure this caused increased competition and a sharp fall in gross margins over H1 2009 – the Company’s first margin decline in over 15 years, which says a lot about how challenging this retail environment is.
Greg Smith stated “these times demand strict management of inventories and cash flows, and we are doing well in these two areas. Capital expenditure is under a tight hold, and no new stores are committed to or planned for calendar year 2009.
However on a positive note our pilots for kitchen and bathroom renovations (Moorabbin and Thomastown) and for a range of new technology, software and gaming product (Moorabbin) have both been launched in recent months and are showing promising early results. We expect these product and services innovations to represent a platform for like stores sales growth as we roll them out to other stores when the retail cycle improves.
Emirates Admits To Service Problems
Emirates the Arab airline has admitted to entertainment and technology problems on their aircraft.
Allans Billy Hyde To Shut Up Shop
As tipped exclusively by ChannelNews last week, the Allans Billy Hyde musical instrument stores are set to close after the $2 billion dollar Guitar Centre decided not to go ahead with a plan to buy the struggling retailer.
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The receivers of Allans and Billy Hyde, Ferrier Hodgson, say the music stores will close within the next few weeks.
Prior to announcing administration, the Company employed 613 people across 25 company-owned stores, four franchise stores and the firm’s head office in Melbourne.
Earlier this week Tim Mason, the Joint Managing Director of the failed retail group, sent an email to several interested parties that read:
“We have been told by Guitar Center that they will not buy AMG. That news is very disappointing for us all. We believe that Guitar Center were seriously interested in the business and we know that a number of senior executives spend many long hours including several weekends on the proposal”.
“This probably marks the end of our efforts to sell the whole business. We understand there are a number of offers to buy single or multiple sites and no doubt Ferriers will explore those opportunities”.
“We want to thank you all for your friendship and help during our time together and particularly over the last few weeks. We have both formed lasting friendships with many people during the time we have spent together and we value those friendships”.
Australian Music Group (AMG), which owns the two iconic retail brands, went into administration in late August owing more than $40 million to creditors.
The receivers, Ferrier Hodgson, say they have been trying to find buyers for the business, but those efforts have failed.
The four franchise stores, which are independently owned, will remain open.
The receiver, Brendan Richards, says he appreciates the efforts of the company’s staff.
“The loss of jobs is disappointing, but we exhausted all avenues and there is no other way forward for this business,” he said in a statement.
“These people have served music lovers and been a key part of the Australian music industry for generations. It is a sad day for live music in this country.”
Mr Richards says he will work with the administrator to make employee entitlements available through the Federal Government’s Entitlements and Redundancy Scheme (GEERS) as soon as possible.
LG Voted Brand Of The Year, Pick Up 10 Other Red Dot Design Awards Along The Way
LG has smashed it, picking up Brand of the Year and 13 other Red Dot Design Awards.
Stand out products for the Korean Company was their LG G4 smartphone and the LG Urbane Smart watch.
LG joins brands such as PepsiCo, Audi AG, and Mercedes-Benz who are all past winners of a Red Dot Award which is recognised as one of the world’s leading design awards for big brand innovations.
LG also becomes only the third company to win both Brand of the Year and Design Team of the Year, which LG won in 2006.
En route to its Brand of the Year honour, LG received 13 other nods from the Red Dot Award: Winning entries include the LG G4 and the LG Watch Urbane, both of which embody “the company’s human-centric user experience design philosophy with a simpler and more intuitive interface to accommodate individual users,” LG said.
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“The brand management of LG Electronics is unparalleled in its skills in this respect. The corporate claim sums it up ? Life’s Good,” said Dr. Peter Zec, founder and CEO of Red Dot. “Anyone who invests in an LG product notices immediately that his or her life is a little more attractive because of it. That is exactly how convincing brand management works.”
LG Electronics Vice President and Head of Corporate Design Noh Chang-ho said the Red Dot Award honour demonstrates the company’s leadership in the field of design through its ongoing commitment to the consumer experience. “We will continue to design and develop creative solutions that elicit a positive emotional response and deepen the relationship between our brand and consumers to live up to our motto, Innovations for a Better Life,” Chang-ho said.
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| Noh Chang-ho, vice president and head of corporate design at LG Electronics |
LG will be publicly honoured at the annual Red Dot Gala in Berlin on November 6. Its winning products can be viewed online on the Red Dot Award website.