what would colin say now

Back in the day over on the PT forum I used to argue with colin marland - trying to get him to admit that PT was gearing the company toward growth at the expense of profit.

Basically - over quite a considerable amount of time, PT has run itself right on the edge of the cliff. Capital was invested into sales staff and dealer payments in order to fuel that growth - the result being that net profits never made it above zero. They ran it so tight that sometimes the loss would only be within the realm of tens of thousands of dollars (sometimes more but only as a result of strange goings on like mobile phone theft).

Well - predictably the share price hit the floor as perception of the company and it's business model became worse and worse. It was thought that a reseller just couldn't obtain the margins necessary to make a profit.

Well - that perception itself was understandable - but not correct. PT always had it within itself to make a profit - but it chose to grow as fast as possible instead. What has been the result? Well - it's clearly grown too fast... and is now in the situation where it's support service can't deal with the problems various technical mistakes have caused (like the decision to go with nextep for the provision of its adsl 2+ service).

Where would PT be if Colin had listened to me and actually cut its growth?

Well - investors would have been well rewarded for one thing. YOu wouldn't have seen earnings multiples at what iinet once had (40 times at one point) because growth itself would have had to be sacrificed for the profit... but it still would have seen many investors - even those that invested at the swiftel height of 13.5 cents get back into the black.

What's more - the slower growth would have meant that the support services that are currently under massive strain... see the pt whirlpool forums... would have had much greater grace time before receiving that sort of volume. PT wouldn't be suffering the massive blow to its reputation... (whirlpool itself as a negative marketing effect is probably almost singlehandedly wiping out the effect of everything they are currently spending on sales staff and the like).

So what would colin say now... would he now admit that they got it wrong in sacrificing profit for growth?