Tuesday, November 01, 2011

iPhone 4 to 4S and Vodafone to Telecom in under 24hrs

In my previous post, I was less than impressed with Telecom NZ**. However, in this post, I must say that I am extremely IMPRESSED with them.

You see, I recently got my hands on a new iPhone 4S, flawlessly migrated every single setting, app, contact, account and picture on my iPhone 4 to 4S using only iCloud (no cables at all), and then started using the "Siri" voice recognition abilities of the new phone. To say that Siri is impressive would be a BIG understatement. You can dictate txt messages to send, you can book appointments, you can dial, you can do all sorts of things. In addition, you can ask Siri such things as the meaning of life (and get an answer), you can ask it inappropriate things, such as "Do you love me", and get clever responses. In short, Siri is pretty bloody amazing.

However, the Siri service uses 3G data to send your voice to Apple servers to process and do the voice recognition, and this means that the service is only as good as the data service of your provider.

I have been a loyal Vodafone NZ customer for over 15 years, never really questioning that they were doing a good job, and regularly paying a phone bill of around $400 a month. I have suffered from having 1 bar of signal strength on my iPhone at my castor bay house, and generally blamed the iPhone and not vodafone, and figured that 3G data was just never going to be that great, and would never compete with DSL or wifi type speeds.

So it was with some amazement, that yesterday when my friend and I were playing with Siri, that he was getting almost immediate responses (via Telecom XT), and my phone barely seemed to be able to work (on Vodafone). That was the last straw for me, and I promptly walked into a Telecom XT store at 5pm yesterday and asked them to port my number across. I expected this porting process between telephone companies to be a horrible process, fraught with stuff-ups where I would probably lose access to my phone for a day or so, and maybe even my number, but I HAD to get Siri working, it's just that cool.

So I was surprised to wake up at 7am today, and find that my phone was reporting "no signal". They can't have done my porting already? can they. To my delight, I put my XT sim into my phone, and found that it was connected with Telecom XT. Even more impressive, was the fact that at my house, I now had FULL signal strength, where I had previously only had one bar. And EVEN more impressive, was that I started surfing around on the Internet on my phone for an hour or so, before I realized that I wasn't connected to my Wifi network, but to Telecom XT. Using data on Vodafone is workable, but it's often slow and Facebook needs to be refreshed, shut down the app etc. On XT, the speeds are just incredible - I highly recommend the switch if you are a power smart phone user. The XT network is 3G ONLY, so there is never a time when you're on GPRS or no data or some slow speed connection.

Even nicer, I found a plan on Telecom for $120 a month that gives me 3Gb of data (not one), 5 times as many txt messages (2,500 not 500), and about double the calling that I have been making on Vodafone. and my bill is now a fixed $120 a month, instead of a variable $400 a month. Thank you Telecom XT!

The only issue I had, was that all my contacts no longer seemed to recognize the names in my address book. (see picture) If I looked at my phone, all my txt messages were now just numbers, despite the fact that the contacts were still there. Initially, I thought my exchange account must have been deleted, but upon calling a friend, I found that this is a bug. To solve the issue, you simply need to connect your iPhone to iTunes and download a carrier update, which fixes the issue with Telecom sending through spaces in the phone numbers, and the iPhone not recognizing the numbers.

**I am not, and have never been a Telecom hater, I just call things as I see them. I think Telecom is a great company, with a marketing department that doesn't always do them justice.

Thursday, October 20, 2011

Did Telecom steal a young father's song?

I'm sure most kiwis will remember the disastrous Telecom "Abstain for the game" campaign, which consisted of getting poor Sean Fitzpatrick to drive around in a giant pink fist on telly, encouraging everyone in NZ to give up sex for the duration of the world cup. 

Widely regarded as one of the WORST ideas for an advertising campaign in history, the concept cost hundreds of thousands of dollars.

As a result of a public backlash against the campaign, Telecom decided to put their efforts into a much more conventional, and family friendly "Backing Black" campaign, which has so far picked up a massive 131,000 followers on their Facebook Group.

Recently, as part of Telecom's new "Backing Black" campaign, Telecom ran an "All Blacks Anthem competition" on Saturday 15th October, which was won by a young kiwi father called Franko, with his song entitled "We are one", and who has been campaigning for his song to be an anthem for the All Blacks for several months.

When Franko won Backing Black's song competition, he asked Telecom's representative at the venue, James Sommersett, if his song could possibly be posted to the Backing Black Facebook group since he had won the competition. Franko was told by Telecom that they would "think about it".

Today, on the 20th October, 5 days after Franko won Backing Black's "Anthem" competition with his song "We are one", Telecom released a video advertisement on their Facebook group ALSO called "We are one - backing black" that was immediately "liked" by around 500 people. The imagery in the Telecom video is of historic moments in rugby, inspirational quotes, and backed by a random classical music track. Quotes include "United together", "One Nation", "One land", "One voice". 

All of this is fine and dandy, except that a LOT about Telecom's video (including the name), is VERY reminiscent in concept and execution to Franko's "We are one" video, including the lyrics in his song.

After people started making comments to this effect on the "Backing Black Facebook page", that their new "we are one - backing black" video reminded them STRONGLY of Franko's song, Telecom quickly changed the name of the video to "We are backing black", instead of "we are one - we are backing black", although the attached screenshot still shows the old title, as it was posted.

I should mention, by way of disclaimer, that I do have a personal interest in this matter, because I gave Franko the money to produce his "We are One" video, as I was inspired by his song, and by his desire to create a song that truly brought all New Zealanders together in sporting events such as the RWC, The America's cup, and the upcoming 2012 olympics. There are people who have cried upon first watching Franko's video, and I am proud to have been able to help make it happen, as it is a great song, and has been a labour of love for Franko.

Now, it's nice of Telecom to voluntarily change the name of their inspirational video, but wouldn't it be better if they had simply promoted Franko's video, since he DID win their OWN Talent competition with HIS song? Perhaps Telecom's marketing department has correctly deduced as a result of their disastrous "Abstain for the game" campaign, that they should NOT use their own ideas under ANY circumstances.

Like Adidas, charging people for over-priced jerseys, Telecom might do well to learn that brand goodwill comes from actually walking the walk, not from your marketing team taking the key elements from a young father's song who wins your talent quest, because they can't come up with anything original.

I'm sure Franko would be interested to hear from Telecom on this matter...

Tuesday, July 12, 2011

Advice for Kiwis wanting to minimise roaming charges when in the USA

I am a frequent traveler, and get to the USA from New Zealand probably four times a year.

A dilemma that often faces travelers, is:
a) do I use my regular mobile number overseas and pay huge roaming charges, but not have the hassle of stuffing around getting a new SIM and/or phone in the country I'm in,
or do I:
b) go to all the effort of setting up a new local number, often for a short period of time, just to save a bit of money?

In previous years, I simply put up with huge roaming charges, because of the convenience of landing, turning on my phone, and having it work straight away. But each time I went to the USA, I'd often end up with $500-$1,000 bills for a week or two abroad, and this only started getting worse and worse more recently, as the need to use data has increased to answer the odd email, or cache an invaluable google map. In addition, I now have a broad circle of friends in the USA, and some of them didn't like calling my NZ number to get hold of me down the road, as then they're paying through the nose, and so am I to receive the roaming call.

I started looking for a better, more permanent solution. And now I wish that I'd done this the first time I landed in the USA. You can potentially save a lot of time and money by following my recipe, whether you are going to the USA on a short holiday, or travel there for business regularly.

Investigating the options
A year or so ago, I spent about three solid days going through all the carriers, plans and options for a temporary traveller in the USA. The USA has a BIG choice of phone companies, unlike a fairly simple telecommunications market like NZ, and let me tell you, it's downright confusing to work out the best deal, even for a techie like me.

There is AT&T, Sprint, Verizon, T-mobile, Boost mobile and more. Verizon runs a CDMA network (like Telecom NZ used to), which means that their phones don't have SIM cards, which ruled them out for me, as I wanted to use my iPhone and have all my contacts, settings and things preserved. AT&T had no pre-pay options, and I didn't want to sign into a term contract. Sprint was hard to deal with and I couldn't understand some of their pricing, and in addition, their pre-pay credit expired every month.

Choosing a carrier
In the end, I settled for T-mobile, as their service was good, their rates were decent, they have an international presence (which means you can use your account for things like hot-spot access in Germany etc), and they had a pre-pay option. Most importantly, they have a feature that none of the other carriers had - which i discovered by reading the fine print. if you top up your account by $100 or more, then they increase the expiry time on any unused minutes to 1 Year, instead of the usual pre-pay 1-3 months. Note that this is a VERY important feature for me, as it allows me to keep the SAME number every time I go to the USA, without having to worry about getting a new SIM, topping up, etc. In addition, T-mobile has 4G support, which is nice.

Every time I land in the USA now, I simply pop in my USA pre-pay SIM & I'm up and running in one minute flat. If by chance I wasn't going to be in the USA for over a year, I could still keep my number by topping up $100 on the T-mobile website. So basically I have a permanent number in the USA for a maximum of $100/yr. The ONLY options with other carriers would have been to:
a) go pre-pay and have to get a new number every trip (as my SIM would be de-activated after a month of no usage), or
b) go on a contract at $50/mth for 1-2 years.

Cutting my SIM down to size
Now that I had my T-mobile SIM, and permanent number, I had to get it working in my phone. I happen to have an iPhone 4, and these take micro-sims, which are smaller than a regular SIM. The bad news is that T-mobile doesn't sell micro-SIMs, because they don't support the iPhone. The good news is that you can cut a regular sized sim down to micro-SIM size with a pair of scissors. How I did it, was by taking out my existing NZ micro-SIM, lining up the contacts with one SIM above the other, and then cutting off all the excess plastic around the edge of the normal SIM, making sure it ended up exactly the same size as the micro-SIM I was using as a guide. I worked it out myself, but if you are scared, just google for more detailed instructions on the process.

Getting mobile data working
Once I put my cut-down SIM into my iPhone, calling and txting on the T-mobile network started working with no problems - as you would expect. However, it took me a while to figure out how to get Internet data on my iPhone, as the iPhone is not supported by T-mobile.

The first step was that i had to go into the "settings / general / network / cellular data network" menu of the iPhone, and enter the APN ID "wap.voicestream.com". This tells the iPhone what gateway to use to get cellular data.

The next step was that on pre-pay, Internet access is disabled by default. You can buy unlimited access on your pre-pay SIM for just US$1.45 per day, but you have to go to "home.web2go.com" on your phone, and enable the "T-mobile Web-day pass". The cool thing is that the iphone now has a portable wifi-hotspot feature, once you have internet on your phone, you can turn your phone into a portable hot-spot, and then you have Internet access for your laptop, Ipad etc, for just a total of $1.45 per day, rather than having to spend $30 a night on Internet like some rip-off hotels charge. It's not always particularly fast, but fine for checking emails and the like.

Keeping costs down
Calling to any number in the USA on T-mobile is about 10c/min (it's cheaper if you top-up higher amounts as I described above), and TXTs are 10c each (to USA, NZ or anywhere). so basically for US$100, you get about 1,000 TXTs (anywhere) and combined minutes of calling (USA only), which seems to be plenty for me. I went to the USA for four weeks on one trip, and did a bunch of calling to all my friends in the USA every day, and it only cost me around US$15/week.

Note than in the USA, unlike NZ, cellphone users have to pay to make AND receive calls. US landline users don't pay a different rate to call a cellphone than any other number. (This also means that no-one needs to know your USA number is a mobile - it could be a landline in the USA for all anyone knows).

Calling back to NZ from your USA mobile will empty your pre-pay balance REALLY FAST, so it's a good idea to avoid it if possible. My solution was to simply TXT anyone in NZ I needed to speak with, and it's usually only a few cents a minute for them to call me. I am lucky in that I own a phone and Internet company (www.voyager.co.nz), so I get good calling rates to the USA! However even at Voyager's RETAIL rates of 5c a minute from NZ to the USA, someone calling my number in the USA from NZ is only going to cost $3 per hour. At that rate, I can afford to divert my Auckland work DDI, and have it permanently diverted to my USA mobile for anyone who wants to call me, and who might be worried about the NZ to USA toll charges.

Apps to use
Another way of keeping costs down, is of course to use the internet as much as possible, which at $1.45/day is a bargain. I have an app called "whatsapp" on my iphone that allows me to send unlimited txts and picture messages to anyone else on the network for free. I also use another called "heytell" that is a push-to talk application that works over the Internet, and allows you to use your phone like a walkie-talkie to anyone else in the world. This allows me to push to talk anytime I have a thought, and then my business manager in NZ can push to talk back and respond whenever she likes. Email, Facebook, Twitter, Skype are also of course communication options, and there are many more. Skype for iphone can be used for video-chatting with the iphone's front facing camera, likewise Apple has FaceTime for that purpose too. All in all, I found on my most recent trip that I was spending $2-3 a day on TOTAL communications costs, and I had full access to the Internet and communications all day long. My friend who came over at the same time as me spent $500 over a short period, and this was just from turning his phone on in emergencies to grab the occasional email, and download google map data as required. Estimated savings - $100/day at least.

Miscellaneous comments
Before I left NZ, I changed my mobile voicemail to say "please don't leave a message, txt me, or call my USA mobile". So then every few days, I put my NZ SIM back into my phone, get any txt messages, and then use my USA mobile to respond to people at much lower costs.

I couldn't get PXT messaging working natively on my USA number, although I didn't try very hard. I haven't bothered to put any effort into getting it working, because as above, I use WhatsApp for that purpose. It will be a case of fiddling around with MMS settings, but because T-mobile doesn't support the iPhone, it's a matter of trial and error. It may also be because I don't have a plan with native data support (just the Web-day pass system).

I have put all of my numbers into my phone into the format "+64 xxx xxxx or +1 xxx xxx xxxx" for NZ or the USA, this way, the numbers work perfectly for all my contacts no matter which SIM I have in, and no matter which country. If you have numbers stored for Vodafone NZ as "021 xxx xxx" for example, and you txt using your USA SIM, the txt's won't go to the correct place.

Summary of the steps
1) buy T-mobile SIM
2) cut SIM to micro-SIM size if necessary
3) top up SIM with min US$100 credit so number won't expire
4) change APN on phone to "wap.voicestream.com"
5) go to "home.web2go.com" on your phone's browser to activate web day pass - unlimited Internet access on your phone for US$1.45 per day
6) communicate via email, skype, whatsapp, heytell etc, basically any Internet method, and your costs will just be that $1.45/day
7) if you need to talk or txt people in the USA, it's not expensive, will just cost you 10c/min or txt
8) likewise of you want to TXT people in NZ - it's the same price 10c/txt
9) if you need to SPEAK to someone in NZ, TXT them, and tell them to call your USA number for cents per minute, rather than you emptying your pre-pay credit. Calling NZ off your pre-pay number will empty your credit in no-time. Voyager.co.nz and Skype offer calling from NZ to USA for just a few cents per minute.
10) put NZ SIM back in to phone every few days to check TXT messages.
11) Save all numbers in phone in full, correct International format.

Posting Location:W 19th St,New York,United States

Wednesday, September 02, 2009

District 9 Movie: Brilliant!

I enjoy going to the movies as much as the next person, but unfortunately I must say that most of the time over the last few years I've been sorely disappointed with most of the new releases I've seen.

One of the worst movies I've ever seen was the recent release of 'GI Joe'. I could tolerate most of the stereotypical and poorly thought out plot, right up until the point where a piece of Antartica was blown up and then pieces of iceberg started sinking and piercing the stereotypical 'evil under water lair of the bad guys'. They probably spent about $2M on that CGI scene, and they couldn't think to get someone with a brain to work out that if a BIG piece of ice is floating above an underwater city, and you blow it up, the SMALL pieces aren't going to start sinking. Ice floats no matter what. Duh. Sooo painful.

So I was delighted and surprised when I went to see 'District 9' produced by NZ's own Peter Jackson (and directed by Neill Blomkamp). This was a movie where you could easily initially assume that the plot would fall into the same "I've seen this movie 100 times before" category, with aliens, bombs etc, but Peter did a MASTERFUL job of getting on board with a movie that ACTUALLY made you believe it could be real - Filmed in a kind of 'CNN documentary' fashion, I don't think I've ever seen another movie quite like it. And I actually enjoyed the movie significantly MORE because there was no big name actor like Brad Pitt or Tom Cruise in the action scenes. Made it so much more believable. Peter must be starting to become very popular with film backers, because not only does he make great movies that I personally want to go and watch, but he must save at least $20M by not hiring big name actors. The small time lead actor in District 9 I think did JUST as good a job of acting the part as any 'big namer' I've seen recently.

I wonder if there is a bit of a sea change happening in the movie industry at the moment - all the pressures of Piracy, DVDs, Home Theatres and YouTube toward non-star based films must be having some effect. If more films like District 9 start being made, and less of the Hollywood junk films that look the same as 100 other films, and you can't remember which film is which, because they all start the same people, then it's got to be a good thing...

Friday, January 23, 2009

How to value a company

I was recently asked by a friend of mine how to accurately value a company. I guess my answer is that 'There is NO such thing as being able to ACCURATELY value a company!' However, there ARE standard methods by which to get an IDEA of value. The value of a company can really only ever be accurately obtained by what someone is willing to pay for it.

In my time I have purchased around 40 small Internet companies, a bar, a Barter company, and various small other companies. I have also then sold a large internet company (the aggregation of all the small ones), and the other companies off again.

When I am looking to purchase companies, I generally use a variety of valuation methods in combination, as one by itself is often not reliable. The valuation methods I most commonly use are:
- Assets minus liabilities (net position)
- Price / Earnings multiple
- Seeby's patented 'heads and eyeballs method of valuing an Internet company'
- Discounted Cashflows

This valuation method is very simply explained as: add up all of the things the company owns (assets), subtract what it owes (liabilities), and then you can come up with a figure. Say for example there was a company that owned $4M of residential properties, and had $1M of mortgages. It would be pretty fair to say that the value of the company was about $3M. However - this valuation method can break down or be incorrect at times. For example - say you had a property company that owned $100M of commercial property, and had $100M of debt. If the property was returning $10M a year in rents (a yeild of 10%), and had costs on the debt of 5% ($5M a year), then this company would be making $5M per year. Clearly the company has a zero net asset position, but is not worth 'zero', as a $5M per year cashflow would be very nice! (The fact that the company is highly geared and may fall over because the bank decides to withdraw funding is another matter again which should be taken into account)

This valuation method is explained as: Take the money that the company makes each year, and then multiply that by some factor in order to work out the value of the company. If you had a company that was making $5M per year (as in the example above), you would expect that it was at least worth $5M (unless under risk of imminent closure), because you could buy the company, and then you'd have your money back in a year, after which you get money for jam. Personally, I like to buy companies at multiples of around 3x earnings, and sell them at multiples around 5x earnings, but companies are bought and sold on earnings multiples all the way from 1 to 100 or sometimes even more depending on all sorts of other factors. This valuation method might fall down or be incorrect where you had a company that had lots of assets and no debt, but didn't make much money. Think of a company that owns $100M of residential property with no debt, but none of the houses is rented out, so there is no income. Clearly it's not a great business from an income perspective, and close to zero from the p/e multiple valuation, but it's probably worth close to $100M.

It's worth noting that a comon way that people such as Eric Watson, Graham Heart and other corporate raiders and leveraged buyout guys make huge amounts of money, is by buying companies that are valued in traditional ways such as described, but then they either break them up and sell off the pieces, or re-package them in such a way that a different valuation method can apply, that allows previously hidden value to be unlocked, and then retained.

I myself have been researching a public company that has a net asset position of $20M, and solid earnings, and yet it's 'market cap' or net worth on the share market has dipped to just $10M because investors are scared of even good businesses right now. This means that if I was able to successfully buy the whole business for $10m, I could sell off the assets and I'd get $20M back (and $6M of their $20M of assets is just cash in the bank, so that would come back instantly). Companies like this are said to have a higher 'asset backing' than market cap - which is rare, but is definitely a good thing, because it means that if the company went out of business, the value of the assets sitting there is more than what you could purchase the company for. It's like buying a company for $500,000 that happens to own a $2M house with $1M of debt, and is therefore worth $1M, but no-body has picked it up - perhaps because the business isn't 'sexy'.

This method I developed myself after 5 years of doing deals to buy Internet companies. It is useful when the other two methods above break down, and can be used to find or justify hidden value. Most often it applies to Internet and tech companies, but doesn't need to. If you think of a company such as Netscape back in the Dot Com Bubble days, they didn't really have many assets other than a bunch of computers and desks (so wouldn't have been worth much on an 'assets' basis), they didn't have much revenue because they gave their product away (so they weren't worth much on a p/e basis), in fact all they did was lose buckets and buckets of money, and yet the sharemarket at various times valued them at hundreds of millions of dollars. The reason for this huge valuation was because of all the 'eyeballs' that they could control, which is an opportunity for future sales. Instinctively you would know that if you had a company that could advertise to almost anyone on the planet, and yet didn't have any assets, and didn't make any money, that it would still be worth a lot because of the potential to up-sell, move into different markets, evolve the business model etc. This is what Netscape was, but ultimately they didn't evolve - if they had evolved into Google in time, then their investors would have been very rich instead of losing their shirts. Using my own more complex inputs and this valuation method, I was able to accurately identify Internet companies that had hidden value that I could sell for a higher price, but that could be purchased for a low price based on traditional valuation methods.

The discounted cashflow method of valuing a business basically takes into account the time value of money, and works out what future income streams are worth today. The discounted cashflow model might be usefull for valuing a company that has no income, no assets, but has a business plan that is likely to succeed and shows considerable growth in the future. Wikipedia probably does a better job than me explaining this, so have a look at their article on the subject

Saturday, November 15, 2008

Dinner with Sir Bob Geldof

Last night I went to a charity dinner in Auckland where Sir Bob Geldof was speaking. Thanks to the guys at Duco who organised the event, I was lucky enough to be seated on Sir Bob's table, and close enough to have a chat to him for a good half an hour or so over dinner about our shared passions of people and the planet (To be honest, Sir Bob is probably more passionate about the people, and I'm probably more passionate about the planet). My polite request for a photo was unfortunately stymied by Paul Holmes, but Paul had his own problems to worry about after publicly calling Sir Bob 'Bob Dylan' more than once during the evening.

To be honest, Sir Bob is probably one of the best, most compelling, most human and accessible speakers I've ever heard. I've heard the Clintons, Obama, Kissinger, Branson and others speak live, and rarely have I been more moved or compelled by one person's passion and life story. Geldof has achieved some amazing things including being better known for Live Aid than singing, raising hundreds of millions of dollars for Africa, being the person instrumental in getting billions of dollars of third world countries debt waived, and pressuring the G8 leaders to do more to help. Surprisingly he had much praise for President Bush for doing more than any other President to help Africa, and related his humorous tales of them hanging out as buddies only a week or so prior.

Sir Bob's information about how Europe has subsidies for farmers that mean that their farmers produce more food than could possibly be required, while African farmers are priced out of the global markets, while Europeans are taxed to store all of that excess food, and then ultimately dispose of it when it goes off, all occurring while millions of Africans regularly starve to death (especially during the Ethiopian Live Aid era), when Africa is just 8 miles away from Europe, did a good job of making everyone in the room feel ashamed to live in the first world.

Sir Bob's aims of brining the third would out of poverty, or at least into a more equal playing field are certainly admirable, and definitely compelling - and I think that we have a human obligation to implement a lot of the policies that he is so passionate about. HOWEVER, as far as the planet is concerned, I have some real concerns that it's just NOT going to be possible in the utopian manner in which a lot of people including Sir Geldof would like to believe.

Currently humanity is ALREADY using up the resources of the planet in a non-sustainable manner. In fact we are already chewing up the planet at a rate that is at least twice the replacement rate of natural resources in every area - so for example, forests are getting chopped down at least twice as fast as they are planted, fisheries are being exploited at least twice as fast as they can recover, water is being diverted for dams and irrigation twice as fast as our needs expand, and the list goes on. In fact, in the case of oil and coal, it took billions of years for those resources to form, and it's only taken around 100 years for us to use perhaps half the resource, so in that particular case, we're using up the resource perhaps a billion times faster than those resources will recover.

What this all means is that even if our global population was to stay steady, and use the same amount of fuel, resources etc, there WILL be a point in the future where we come up against a wall (which will be MUCH worse than the financial crisis), where we simply run out of resources to live in the way that we have, and we will either perish in the billions, or find new, more sustainable ways of living. Even if you don't believe in global warming, it's still easy to see that the whole world has been built out of the energy from coal and oil, and that perhaps there is only 50 years of those resources left. The whole world is going to have to shift to running on sustainable energy over the next 50 years or we're stuffed. Considering it can take 20 years to get a dam consented, planned and built, this isn't a lot of time.

Now here is where my concern for us and the planet really kicks in. As I have outlined - we ALREADY have a HUGE problem to deal with in the way that we are living in terms of Global Warming, and environmental degradation. Now if our impact on the planet was to DOUBLE, then obviously that problem would become a lot worse and we would hit the wall twice as fast. But I guess you might say 'well - we have to solve these problems anyway, so it won't be much worse to solve the problems for twice the number of people'. But what if I told you that our impact on the planet was going to be HUNDREDS of times the current environmental impact if we implement all of Sir Bob's wildest desires and lift all of the third wold out of poverty to a level of living comparable with our own?

You see, the Impact on the planet "I", is not just a factor of population, but also a factor of the Affluence, and resource use of each person "A", as well as the Technological impact "T" of each person, such as whether they use a hand plow, or a giant mechanical plow. We have been told that the population is going to grow to 9 billion people by 2050, so that's already an increase in resource use of 50%. But one thing that a lot of people aren't aware of, or don't think about, is that the average third world person currently consumes JUST 1/50th the resources of the average first world person. So for example, they don't have a car, plasma TV, big house, lots of water use, throwaway meals, clothes etc. The other thing is that there are currently TWICE as many third world people as first world people. So if ALL of the third world was to achieve a level of Affluence on par with the first world, we would have twice as many people using 50 times the resources, or around 100 times the resource use. The other factor is if course the Technology factor, that allow a single person to have so much more of an impact on the planet than previously - think of a chainsaw vs an axe, a tractor vs a manual hoe etc. The technological impact I believe would be around a 10 times multiplier, but lets just assume that it doubles.

So: our impact "I" on the planet in the future, if we lift the whole world out of poverty, will be an increase of: 50% (6 billion to 9 billion people); TIMES an Affluence impact on the planet of around 100; TIMES a Technological multiplier of at least 2; EQUALS: around THREE HUNDRED TIMES THE ENVIRONMENTAL IMPACT ON THE PLANET OF TODAY. Who wants to put their hand up and say that they believe that the planet could support a rate of exploitation 300 times current levels?

Now, the first world is already in population decline, because we have a level of Affluence that makes us comfortable, and we don't need to have large numbers of children to support us. In some African countries, the AVERAGE number of children per family is 9. So the challenge is HOW do we lift the third world to a level of wealth where they don't feel the need to have so many children BEFORE the world runs into an environmental crisis hundreds of times worse than the current financial crisis? Well - to be honest, I just don't believe that we can. My personal opinion is that in the coming decades we will see mass starvation and famines that make the Ethiopian crisis of 1984 look pale by comparison. We need to do what we can, but perhaps its time that the world started talking about having voluntary goals of a world population lower than todays, and a 'one child' policy similar to China's if the third world is to receive aid at all?

I'm NOT suggesting we kill anyone off, or let people starve if we can prevent it. BUT if humanity is going to co-exist with the rest of the animals and the planet for thousands of years to come, do you think it would be better to have a steady-state of around ONE billion people on the planet, all living sustainably and harmoniously, all being able to live close to the sea or in beautiful natural surroundings, or do you think it would be better to have TEN billion people all living in a polluted and charred earth, and all living in tiny concrete apartment blocks next to smouldering rubbish dumps? It took 10,000 generations of humanity to reach one billion people, and it will take just over ONE generation to go from one billion to ten billion. Perhaps it's time that we put the needs of the planet and the millions of future generations first, and talked about that taboo subject of setting a population limit for the planet before it's too late.

Sir Bob Geldof visits NZ herald article here

Sunday, October 19, 2008

John Key under fire from the sloppy thinkers

On page 24 of the NZ Herald on Sunday today (and quoting from the opposable thumb blog), there is the following statement: "Key would be the last person qualified to run an economy, especially as the particular business he was in - investment banking - is all about maximising profit pretty much regardless of other considerations, and doubly especially given the current crisis, which has been visited on us by the colossal mismanagement of, you guessed it, investment bankers".

I didn't think this was fair on Key, so I thought I'd make a few brief comments:

- If you were in a plane, and planes all around the would started falling out of the sky, and then your pilot died, would you rather put someone in the seat with plenty of prior experience as a pilot? or would you think it sensible to blame the problem on all pilots and put someone with no experience in the job instead? 
- All Kiwi's should want the country to do well - what is wrong with being aspirational and having a leader who wants the country to run profitably? I like the idea of sound business principles being applied on a country level so that we all end up wealthier.  If Key has experience and a successful track record in maximising profit, then isn't that a good thing for us all?
- Would Key *really* be the *last* person qualified to run the economy? I suppose a P-addicted gang member could be more exciting...
- Is cutting political commentary really your skill if you use expressions like 'doubly especially'?