Aussie banks on the nose… What price fast broadband?… Fielding extends protections… Tax, not IR, is main concern… Hot new industries… Blu-ray’s jump on HD DVD… Economy roundup…
Tuesday, June 19, 2007/
Aussie banks on the nose
It’s a bad day for Australian banks, with a global survey ranking them poorly just as Choice and the Consumer Action Law Centre have launched a nationwide campaign against penalty fees.
The Booz Allen Hamilton report says Australian banks trail other banks in providing clear and logical information, and performed particularly badly in sales and service, with customers frustrated at long connection times and speaking to machines. On a positive note, the research, which included interviewing 2000 banking customers, showed Australia excelled at mobile banking. The only place mobile banking is available elsewhere in the world is Hong Kong.
Meanwhile, Choice and Consumer Action are attempting to mobilise customers to fight unfair penalties. Penalty fees, Choice explains in a press release, are charged when consumers don’t have enough money to cover direct debit or cheque payment, go over their credit card limit or make a late payment. Penalty fees can be up to $50.
The organisations are arguing the fees are “probably unlawful” and urge customers to make a claim against their financial institution to have the penalty fee reversed, to call federal Treasurer Peter Costello to complain and tell their story, and encourage others to join the campaign.
Another survey out today, by JP Morgan and Fujitsu Consulting, found 60% of respondents are dissatisfied with their financial services provider. Nearly 33% of the 25,000 businesses polled cited service as the root cause of their dissatisfaction.
Meanwhile, read SmartCompany’s top story: Small and medium sized businesses are paying two or three times more on merchant fees than they should.
– Amanda Gome
What price fast broadband?
SMEs want faster broadband, but it’s got to be at the right price, according a new survey by telecommunications analysts Telsyte.
In a survey of more than 300 businesses across the country, half of SMEs said affordability was the key concern with their broadband service; only about one-third nominated speed and reliability as the most important issues.
Telsyte industry analyst Samia Jawed says that although many SMEs would like to have faster broadband than the 256 kbps to 1.5 mbps most have now, most do not need to move up to the kind of very fast broadband that has been mooted in the current political debate.
“Compared to what they have now, a speed of around 6mbps would be a huge leap up, really speed around 2mbps would be what many of SMEs would use,” Jawed says.
Ovum telecommunications analyst David Kennedy says whoever builds a new broadband network, SMEs looking forward to lower prices are likely to be disappointed.
“There will be an improvement in technology but it looks like prices will stay about where they are now. Telstra discovered the entry sweet spot for broadband is about $30 per month and it probably won’t go below that in the medium term,” Kennedy says.
He says 12mbps speeds would be more than adequate for the most common online business functions such as VOIP, video conferencing, multi-site office data sharing and e-commerce.
Market Clarity chief executive Shara Evans says there are some niche industry sectors that will benefit from very fast broadband speeds up to 20mbps.
“Health, financial services, education and IT businesses are really the only ones that need the very high-end speeds because they are the ones who will use high-definition video conferencing or transfer very large amounts of information,” Evans says.
In the context of the current debate between Wi-Max vs fibre-to-the-node broadband networks, however, Evans says for must businesses the technology used will make no difference.
“Right now the important thing is really to get the regulatory arrangements right. If decisions are rushed and we end up with regulations and ownership structures that don’t work, that could mean higher costs for decades to come,” Evans says.
– Mike Preston
Fielding extends AWA redundancy protections
Employees will have their redundancy entitlements protected for two years after their workplace agreements are terminated under an amendment to fairness test legislation negotiated by Family First senator Steven Fielding.
At present, redundancy payments entitlements under collective agreements or AWAs are protected by law for one year after worker’s employments arrangements change. But Fielding says a two-year protection period is required in order to prevent employers terminating workplace arrangements and then waiting 12 months so they can sack workers without having to make redundancy payments.
Workplace Relations Minister Joe Hockey says the amendment will be incorporated into the legislation, which is currently being debated in the Senate.
The change will create yet more uncertainty for SMEs already nervous about having to deal with additional red tape once the AWA Fairness Test takes effect. Read our legal update on the uncertainty businesses are facing.
– Mike Preston
IR is important but SMEs care more about tax
Taxation is the single most important election issue for twice as many SMEs as big businesses, according to a new survey by the Australian Chamber of Commerce and Industry.
Over 20% of SMEs surveyed listed the level of tax as the most important factor in the lead-up to this year’s federal election compared to just 7.8% of large businesses.
Industrial relations was a much bigger issue for large businesses, 20% listing it as the most important issue compare to 14% of small businesses and 17% of medium businesses.
But economic management topped the list for businesses of all sizes with 25% of SMEs and 24% of large businesses listing it as their most important issue.
– Mike Preston
Hot new industries: bye bye manufacturing
Job growth will be highest in health and community services and mining while the manufacturing sector is predicted to continue its slow decline, according to a new report from the Department of Employment and Workplace Relations.
The report says that over the next five years, job growth will be highest in health and community services, property and business services and retail trade.
Meanwhile, more than half of all new jobs will be in accounting, sales, health and fitness and secretarial services.
But while employment for low-skilled workers and labourers grew 5%, about 34,000 jobs will disappear in manufacturing in the next five years.
– Amanda Gome
Blu-ray gets a jump on HD DVD
Blockbuster US is to roll out an expanded range of Blu-ray discs in its 1700 outlets, in what is a blow for rival format HD DVD.
ITWire’s Stan Beer says the announcement that the Blockbuster video store chain will stock only Blu-ray titles in its remaining 1200 stores after an initial 500-store trial exposes HD DVD spin for what it is.
By far the biggest selling high definition player to date is the Blu-ray toting PlayStation 3, a non-dedicated player. According to the HD DVD Promotional Group’s own numbers, consumers have bought 150,000 dedicated HD DVD consumer electronics players. To date, worldwide sales of PS3 consoles is approaching four million, with about 1.5 million sold in the US. Add to that about 100,000 dedicated Blu-ray players sold and it looks like we have a winner.
Blockbuster US says it will continue to offer both Blu-ray and less successful rival format HD DVD titles through its online rental service, http://www.blockbuster.com/, and will continue to offer both formats at its initial 250 stores that currently carry both high-definition formats.
– Jacqui Walker
Fielding acts on predatory pricing
SMEs will receive greater protection from predatory pricing by larger competitors under new legislation introduced into Parliament yesterday by Family First Senator Steven Fielding. Under Fielding’s proposal, businesses with significant market power in the groceries, fuel, pharmaceutical products and medicines markets will be prevented from offering “goods or services in a market at unreasonably low prices” with the “purpose or effect” of lessening competition or eliminating competitors.
The chief executive of the National Association of Retail Grocers of Australia, Ken Henrick, says his organisation strongly supports Fielding’s bill. “Work certainly needed to be done on predatory pricing and we’re happy with Senator Fielding’s bill,” Henrick says. “If the Government feels it can’t support the bill the onus would certainly be on it to come up other ideas of its own.”
The Government is expected to introduce its own legislation dealing with trade practices later this week but it is unlikely to be debated until the Spring session of Parliament in September.
– Mike Preston
A massive increase in exports to China has pushed Western Australia ahead to become Australia’s biggest export state. WA’s exports to China increased 41% in the year to April, to $13.3 billion, according to figures from the WA Treasury reported in the Australian Financial Review today. Exports from WA now account for 35% of the nation’s total. Massive iron ore and LPG export deals are behind the explosive growth.
At 12.50 pm the S&P/ASX 200 was down 0.2% to 6329.9 and the Australian dollar was trading at US84.31¢, down on yesterday’s US83.43¢ close.
– Mike Preston