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Dull Friday quiz

February 25, 2011 13 comments

Since I’ve been blethering on about aviation, that’s the quiz topic:

1) Which single airport (domestic or international) is the most popular passenger destination for people flying out of Boston Logan Airport?

2) Where was Air Berlin headquartered for the first 12 years of its existence?

3) Out of the top 40 international destination airports flown from the US, which five have the highest percentage of passengers flying there on US airlines? (ie as close as possible to “100% of people who fly there use Delta, United, AA, Southwest, etc”)?

4) Out of the top 40 international destination airports flown from the US, which five have the lowest percentage of passengers flying there on US airlines (ie as close as possible to “100% of people who fly there use Aeroflot / Zimbabwe Airlines”)?

5) From which airport in the EU can you catch a direct, non-stop flight to Australia?

Categories: Transport Tags:

Airlines and Virginity

February 22, 2011 24 comments

There’s been some chat this weekend about a sale of Virgin Atlantic. Very much like the sale of Cadbury, this is a point where my general views about the free market are coloured by views by the awful bastards who might end up owning things that I like to have [*].

Virgin Atlantic are the best international airline, without a doubt. Sadly, I seldom fly on them, for tedious reasons related to former employers’ corporate travel policies and enormous quantities of OneWorld Airmiles. If I knew I was going to have to make two business class trips to the UK over the next 12 months, I’d definitely take both with Virgin (because that would earn me a privilege card and would be aces). Since I know I’m going to have to make one economy class trip to the UK, and various other trips elsewhere also in economy, then it’s not going to happen.

And that – if you replicate for everyone who doesn’t live in the UK but thinks Virgin Atlantic are a great airline – is why Virgin Atlantic are, erm, not in quite the financial situation that a self-respecting billionaire owner would hope for.

The future of airlines is alliances plus MONEY.

As far as alliances go, there’s OneWorld, which features the UK’s second-best major airline (BA), mainland Europe’s second-best major airline (Iberia), the US’s least terrible major airline (American Airlines), Japan’s biggest airline (JAL), which I’ve never flown on, the best of the cheap Asian airlines (Cathay), and Australia’s really quite delightful Qantas. Plus some jokers (notably, Finnair. Usually, it’s cheaper to go SYD-SIN-HEL-LHR than SYD-SIN-LHR…). If you’re from almost anywhere, it has the helpful property of getting you almost anywhere else in two hops.

Then there’s Star. If you’re not from the UK or Australia, Star is not a bad alliance at all. It features Lufthansa, who are mainland Europe’s best major airline; Singapore, who rival Virgin Atlantic for The Best Airline (and, to their complete regret and lack of any kind of synergy, own a 49% stake in Virgin Atlantic); United, who’re slightly worse than AA but not by a huge margin; BMI, who used to fight it out with BA on short-haul routes until Ryanair and Easyjet killed all short-haul premium airline traffic that wasn’t direct transfers; and Air New Zealand. If you’re from almost anywhere that isn’t the UK or Australia, it has the helpful property of getting you almost anywhere else in two hops.

And finally, there’s SkyTeam. In the same way that you have McDonalds, Burger King, and greasy men selling you poisonous burgers; or in the same way that you have Microsoft, Apple, or comedy devices that only geeks can comprehend, there’s SkyTeam. SkyTeam features Air France, the most terrifyingly dangerous and irresponsible airline in the developed world; KLM, who I hate for personal reasons [**]; Delta, who’re slightly worse than United or AA; and some entirely unreassuring third-world airlines.

Aside from the alliances, you also have two airlines trying to convert their geographical and geological advantages into a viable business: Emirates, which is Emirates; and Etihad, which wishes it was Emirates. Both are perfectly acceptable.

Emirates is the best way of flying from $_medium_sized_European_city to $_medium_sized_Asian_city, because it flies to absolutely all of them, having noticed that a) its geography is perfectly suited to this; b) fuel is cheap; c) fuck, we have to do something which isn’t just oil. Having been a very good airline for 30 years, Emirates has reached the point where it doesn’t *need* an alliance. Yeah, it can’t fly transpacific, but it can do everything else. And it’ll probably buy Air New Zealand whenever everyone’s stopped being so paranoid about Arabs, if only to stop Singapore buying it first.

Etihad is more of an unknown concern. It was set up by the government of Abu Dhabi in a fit of pique about the fact that Dubai, despite being poorer and less important than Abu Dhabi, had managed to build a world-class airline. So they’ve poached many of the westerners who built massively successful airlines, and have bought huge numbers of planes, and there’s a huge “this must win” thing occurring. And Abu Dhabi airport is over 100km from Dubai airport, so there’s no actual direct reason why both airlines can’t win at once. The most important thing to bear in mind for Etihad, though, is “must be more important than Emirates”.

Oh, also Etihad has an alliance with Virgin Blue, which is Australia’s second-biggest airline. That’s a bigger deal than you’d expect – given Australia’s size and isolation, it’s a far more important market for aviation than its population would justify. Virgin Blue, under various brand names (V Australia, Polynesian Blue and Pacific Blue – the Singapore/Virgin deal currently prevents them from using the Virgin name for international flights), has a sizeable and profitable domestic, intra-pacific, and growing transpacific business.

So, out of this bunch, who’s going to buy Virgin Atlantic? Well, let’s consider the options.

1) OneWorld. No chance. It doesn’t help their network or brands, and the UK regulators would immediately tell BA to shove it.

2) Star Alliance. No chance. Through BMI, Lufthansa are the second-biggest airline at Heathrow, so slots would need to be sold. Also, it’s clear through Singapore’s behaviour that it has no interest at all in Virgin – it just wants the cash.

3) SkyTeam. Very possible. Would be sad for customers, because VS’s excellent standards would inevitably be lowered to those of the other, dreadful, airlines in that alliance. On the other hand, it’d fill an obvious gap for SkyTeam. It’s a risk for Singapore to sell, though, for the same reason: the giant UK gap in SkyTeam would be filled, which wouldn’t make its Star partners happy. And it’s not like any of the SkyTeam partners are so flush as to make Singapore an offer it couldn’t refuse.

4) Etihad. Would be good for customers: the Virgin brand would help Etihad in non-Asian markets; Virgin Blue’s already affiliated with Etihad; Richard’s involvement in “how to make people love your airline” would be welcomed rather than seen as a pain in the arse. Singapore would probably sell cheaper to Etihad than the SkyTeam airlines, as it’s not a threat on core Asian routes (no SE Asia hub). On the other hand, is there really room for non-alliance airlines, even if they do have petrodollars behind them? And how does not having a hub in SE Asia work for a global airline?

I’m keeping my fingers crossed for option 4, but we’ll see how it goes. In an example of how easy it is for people to differ on these things, veteran Aussie airblogger Ben Sandilands thinks there might be a future in a Qantas/Singapore tie-up, whereas I can’t see either airline leaving their core alliance. If the Arabs are banned, Singapore will buy Air New Zealand at some point, though.

[*] Kraft failed to appoint any Cadbury people to its management team in the US, despite the fact that the whole reason for buying the company was that Kraft had been desperately floundering but was cash-rich due to its evil cigarette dowry whilst Cadbury had being growing massively. And now it seems to be removing Green & Blacks chocolate from Australia, in favour of its pre-owned Swiss brands. No greater calumny could be perpetrated…

[**] In the days when this sort of thing happened, my employer paid over GBP2000 for a business class ticket from Detroit to Glasgow for me with KLM. The Detroit-Amsterdam plane wasn’t a problem, but my scheduled plane out of AMS was cancelled. They then let two more planes leave for Glasgow without me on either of them, on the grounds that people who’d paid GBP100 for a quick hop in economy were more valuable than business class customers and they couldn’t possibly bounce anyone. Even as someone who travels for next-to-nothing at the back of the plane whenever I can, that ain’t right – you find some hippies who’d be willing to spend another night getting stoned, you give them GBP200 to turn up tomorrow instead, and you get your business class passengers on the next plane.

Categories: Uncategorized

Friends don’t let friends buy gift cards

February 18, 2011 11 comments

Australia’s worst book retailing chain, RedGroup (parent of Borders and Angus & Robertson) went into administration yesterday. There are a few reasons for this:

1) RedGroup was a highly indebted private equity portfolio company;
2) Australian retail spending has been weak-ish in general for the last year or so;
3) Books have been particularly hard-hit by consumers switching to online retail from overseas;
4) This is exacerbated by an extremely silly law which bans wholesalers and retailers importing books from overseas, instead forcing them to pay exorbitant local publisher prices;
5) According to pinch-of-salt-worthy rumours, the chain wasn’t very well run. Certainly, it didn’t provide a very enjoyable retail experience.

So, it’s the kind of story that was prevalent in the UK in the late 2000s: a retailer which isn’t massively successful but was making just-about-tolerable money gets bought and heavily leveraged by a private equity company. Then the market takes a turn downhill, the new owners can’t cut costs enough to make up for the downturn, and the company can’t make enough profit to pay the debt – so the administrators get called in and the shareholders lose all their money. On the plus side, at least the shareholders who lost all their money on the deal were greedy private equity zillionaires.

But since the Australian media has been denied an ‘OMG THIS IS AN OUTRAGE!!!’ story from ripped-off shareholders, it’s managed to dig one up from consumers instead, about RedGroup gift cards not being honoured by the administrator. Well, no – of course they aren’t. Indeed, he’s being very generous in their case.

When a company goes into administration (Australian and UK law are fairly similar here), the administrator is required to run the company in the interests of its creditors – the people to whom it owes money – until he has worked out a longer-term plan for the company’s future. If he can sell the business as a going concern once the debts are out of the way, this will normally generate the most value for creditors.

In this case, RedGroup’s creditors are its banks, the Australian Tax Office, its landlords (because the stores have multi-year leases), its suppliers (because publishers are paid in arrears), and the people who hold RedGroup gift cards (because they represent a commitment for RedGroup to give you goods of a certain value on a certain future date).

If the company is unable to pay all of its debts, some of these creditors take priority over others, because their debts are legally enforceable against the assets of the business. Usually, these secured creditors are the banks and the ATO (under certain circumstances). So the administrator’s job is to come up with the best way of minimising the loss to the company’s creditors in total, while also ensuring that secured creditors are the first to be repaid. It’s likely that RedGroup is in this position: otherwise, its management would have been unlikely to bring in the administrator in the first place.

This means that if Penguin’s MD were to turn up at RedGroup’s head office saying “you haven’t paid us for books in months, give us some money now!”, then the administrator would tell him to go away until the administration process is complete. Penguin will get its share of the remaining assets once the secured creditors have been paid off, but as an unsecured creditor it won’t get anything until then.

The administrators of collapsed UK music retailer Zavvi applied this same approach to gift voucher holders: they were treated as unsecured creditors, and – along with other unsecured creditors – are likely to get back 10-20% of the face value of their debt. However, RedGroup’s administrator has been more generous to voucher-holders than Zavvi’s.

Borders or A&R gift card holders also have the right to lodge an unsecured claim, but the administrator has said that they can instead fully redeem their card as long as they are spending twice its face value (i.e. if you buy $40 worth of books, you can pay with a $20 gift card and $20 in cash or card). This is offered as a gesture of goodwill, but presumably reflects the administrator’s belief that the chain will be worth more if he does this – both because it’ll keep up cashflow in the short term, and because it’ll tarnish the brand less than if cardholders had been offered cents on the dollar years down the line.

The difference in administrator behavior is most likely because Borders and A&R are likely to continue to exist in some form or other, whereas Zavvi pretty much wasn’t (it was a newish brand, and it moved from ‘precarious’ to ‘ruined’ after its main supplier went insolvent a month before Christmas and therefore couldn’t supply it with stock). But if the administrator ends up concluding the finances look really nasty, this could all change – so if you’ve got a voucher and you value a half-price trip to the bookshop, then now’s the time to use it.

What’s the conclusion, apart from ‘don’t borrow money against assets that won’t cover your interest payments, duh’?

Well, for individuals, no matter how unimaginative you are, how mercenary your nieces and nephews are, or indeed any other concerns of any kind whatsoever, don’t buy gift vouchers. Would you spend $50 on unsecured, 0% interest bonds sold by a highly indebted company struggling to stay afloat in a massively competitive market? No, nor would I – and that’s exactly what purchasers of gift vouchers are doing.

There’s a policy conclusion as well, which is that retailers shouldn’t really be allowed to issue gift vouchers – they’re effectively a license to print money, granted to institutions that (jokes about the financial crisis aside) are far less regulated and far more likely to go under than banks are. That can’t be a good thing, for anyone in the system.

If retailers do want to have a gift card scheme, they should be obliged to lodge all money earned from the sale of gift cards with a third party, completely detached from the assets and liabilities of the business, and only released when the gift card is redeemed against goods. I suspect, since it doesn’t mean Free Cash Now, such a scheme would be significantly less popular among retailers than the current setup…

Mac, and back, with knobs on

February 11, 2011 23 comments

I believe it’s a popular cliche among serious enthusiasts for Mr Jobs’s products to say “once you go Mac, you’ll never go back”.

Here’s a datapoint to the contrary.

I bought a MacBook Air at the end of 2008. At the time, the GBP was at an entertaining 2:1 exchange rate with the dollar. Naturally, Apple being a bunch of thieves, the UK list price in pounds was more or less the same as the US list price in dollars. Luckily, I happened to be on a trip to the US at the time, and therefore only had to pay about GBP1000 for the thing.

It was pretty. It still is pretty. If anyone ever asks me whether or not Apple’s products are pretty, you’ll get a 100% unequivocal ‘yes’ from me.

It did various fun things that the assorted work laptops I’d owned before it couldn’t, like having an inbuilt video camera. Exciting! It’s a pity the bloody thing was so processor-intensive on the machine’s pathetic processor that Skype rarely worked, but hey – videos!

It didn’t run much software, but that’s OK – all you really need is Office and Creative Suite, which I had. And a decent browser, which admittedly wasn’t available at the time of purchase, but Chrome didn’t take too long to come out afterwards. And it’s not Apple’s fault that Office 2007 for Mac is completely unusable for anything serious (*doesn’t support macros*? ARE YOU ON DRUGS?)

Anyway. It had a very quiet life for 14 months as a personal laptop, to go alongside my personal desktop and work laptop, and occasionally being used for design work. Then it came to Australia with me to become my main computer.

ERROR. Apparently, if you go Apple, your year-old GBP1000 (or GBP1750, if I’d bought it in the Apple Shop) laptop isn’t actually up to the challenge of working as a main computer. Running an external monitor as a second desktop made it sad. Running Excel, Word, Powerpoint and Chrome at the same time made it very sad. Trying to run Skype, or anything else, on top of the above… well, it wasn’t a great success.

Around this time, it started emitting evil squealing noises whenever it’d been in operation for more than a couple of hours. I dismantled it and cleaned out the fans, which stopped the problem temporarily – but of course it recurred.

Eventually, about last October, I had no alternative but to go to the local computer shop and pay the equivalent GBP550 for a real computer. So I did. And I’m extremely happy with it – it does everything I could conceivably want, and it does it fast.

The plan was to keep the Air as a backup machine / actual notebook when lugging the Samsung wasn’t ideal (example of why lugging the Samsung isn’t ideal: it has an inbuilt numeric keypad. Awesome for Excel; not so good for fitting in luggage…). Which worked for about six weeks, until the Air developed a screen malfunction whereby about a quarter of the screen was incomprehensibly scrambled all the time. Oh, and the evil wheezing got worse, too. And the battery life had fallen to under an hour.

So I tolerated that, for a while. And then today, I saw this chap for the equivalent of GBP200. No slower than the Air at its best for basic tasks, easily portable, compatible with things – nothing not to like.

And that was it, for me and Apple. The day I realised their markups are so enormous that you can buy an excellent luggable and a decent netbook for less than the cost of their compromise machine. The day I finally decided to let the pretty go, and accept that everything else about Macs is just annoying.

I should also say – the decision was made easier because Windows 7 and Office 2010 (unlike Vista, and unlike Office XP) are *actually quite good*. I’d have considered staying with Apple for longer if the alternative were a Vista machine.

…which is all partly a long-winded way of saying:
1) No, I’m never going to buy a fucking iPhone.
2) I have quite high hopes for the Nokia/Microsoft smartphone alliance that’s just been announced. Nokia makes good hardware (and still has the best phones for use as phones), and Windows 7 shows that Microsoft is capable of making good software. That’s got to be a start.

Categories: Technology Tags: , , , ,

Two very different sorts of offence

February 6, 2011 8 comments

The BBC has been in the news yet again for perceived offensiveness, with the Mexican ambassador slating Top Gear for calling his countrymen backward and lazy, and the Japanese ambassador slating QI for, erm, let’s get back to that one. But although lazy commentators on both sides (especially the ‘PC HAS GORN MAD’ side) have been keen to link the two examples, they’re very different.

Here’s the transcript of the Offensive Top Gear Mexico Routine.

Richard Hammond: Cars reflect national characteristics, don’t they, so German cars are very well built and ruthlessly efficient, Italian cars are a bit flamboyant and quick, a Mexican car’s just going to be lazy, feckless, flatulent, overweight… leaning against a fence asleep, looking at a cactus, with a blanket with a hole in the middle as a coat.
James May: It is interesting, isn’t it, because they can’t do food, the Mexicans, can they? Because it’s all like sick with cheese on it, I mean…
Hammond: Refried sick!
May: Yeah, refried sick.
Hammond: I’m sorry, but just imagine waking up and remembering you’re Mexican: ‘awww, no’.
Clarkson: No, it’d be brilliant… because you could just go straight back to sleep again. That’s why we won’t get any complaints about this, because at the Mexican embassy the ambassador’s going to be sitting there with a remote control like this *mimes being asleep*

Hammond’s initial comment is a reference to a fairly stupid but well-known stereotype. The comic phrasing and timing is decent – and the concept of a car leaning against a fence asleep, looking at a cactus and wearing a poncho is entertainingly surreal. If followed up by “but this Mexican car is actually rather good”, it wouldn’t be particularly offensive – it’d be clear that the speaker was citing an old stereotype and then pointing out that it didn’t apply.

May’s follow-up is entirely witless, pointless and offensive. Hammond sycophantically tries to come up with something slightly funny based on May’s routine, which May then repeats to claim The Witty Thing for himself. Then Hammond goes somewhere very bad indeed (switch “Mexican” for “black” in the “Imagine waking up…” line). This is the appalling bit, and it seems to come out of Hammond’s attempts to amuse May.

Clarkson’s involvement is more interesting: rather than running with the invective Hammond and May have started, he shuts it down with a meta-joke about the whole routine. Unlike Hammond’s comments, and very unlike May’s comments, he’s got a good line followed up by a great line – and it moves the main attack from ordinary people to lazy, pompous bureaucrats. Which is another stereotype, of course, but hardly one that’s worth puncturing.

Anyway. Steve Coogan’s article on the debacle is worth a read – but to me, the dynamics of that routine highlight the truth of Stewart Lee’s Top Gear routine from five years ago. Clarkson is witty but lazy, Hammond is a desperate sycophantic tosser, and May is a thug.

Overall, it was absolutely right for the BBC to apologise for Hammond’s comments about Mexico, and it’s a pity that Jeremy Clarkson isn’t surrounded by smarter and more interesting people.

Meanwhile, from the entertaining-if-smug QI (I’ll note in passing that when Clarkson appears on QI he’s much better than he is on Top Gear, probably because he’s surrounded by smarter and more interesting people. But he wasn’t on this one. I can digress if I like; it’s my blog):

Stephen Fry: Now what is so lucky about the unluckiest man in the world?
Rich Hall: He got killed by a horseshoe?
Fry: Well, this man is either the unluckiest or the luckiest depending on which way you look at it.
Alan Davies: Something like he’s had more accidents and operations than any other man in the world and he’s still alive?
Fry: Bear in mind we’re after places beginning with H, and if I tell you his name this may help – his name was Tsutomu Yamaguchi, and he died in January 2010 aged 93. He lived a long time, so he wasn’t *that* unlucky…

Davies: Hiroshima?
Fry: Hiroshima.
Davies: Bomb landed on him and bounced off?
Fry: He was in business in Hiroshima when the bomb went off. He was badly burned, spent a night there.
Davies: …and he went to hospital in Nagasaki?
Fry: The next day, he got on a train, bizarrely, which shows you that even though the atom bomb fell, the trains were working. So he got on a train to Nagasaki and a bomb fell again. He became a sort-of hero, but only got the recognition in his 90s.

Fry: He’s either the luckiest because he survived an atom bomb twice, or the unluckiest because…
Bill Bailey: Well, he lived to 93, so his life was not curtailed.
Rob Brydon: Is the glass half empty, is it half full? Either way it’s radioactive. So don’t drink it.
Davies: He never got the train again, I tell you.
Fry: The astonishing thing to me is, you drop an atom bomb on Hiroshima and the train service is working the next day. In our country…
Davies: “Keep Calm And Carry On”
Bailey: …a couple of leaves and that’s it.
Fry: Yes, for the rest of the winter.
Bailey: “The wrong kind of bomb”. *station announcer voice* “Sorry, the wrong kind of bomb”.
Fry: Well, it was clearly the right kind of bomb. “It’s fine everyone, don’t worry, this was the right kind of bomb”.
Bailey: *station announcer voice* “The right kind of bomb has landed on the 4:30 from Potters Bar. Please proceed to the nuclear area. The sandwiches have not been affected”*.

So, there’s absolutely no trashing of national stereotypes, nothing at all racist, and nothing that even personally attacks Mr Yamaguchi. The only national characteristic or trait mentioned is the fact that Japan’s trains are better than the UK’s. The whole thing is good-natured whimsy, based simply on the fact that for some poor bastard to get caught up in both the Hiroshima and Nagasaki bombings – and to survive for 65 years afterwards – is a funny coincidence.

And yet the Japanese embassy still complained.

The text of the embassy’s letter isn’t available. But the BBC’s apology is available – and it’s completely and utterly inappropriate.

The difference between the QI piece and the Top Gear piece is obvious to anyone with more than half a brain: one is saying insulting things about individuals based on their ethnicity; the latter is pointing out the humour in a tragic situation, while also engaging in light self-mockery over the UK’s ineptitude at public services. The former, although it can be justified on occasion, often ends up as bullying and perpetuating racism. The latter doesn’t. It’s just what comedy is.

The BBC shouldn’t be making shows that insult brown people for being brown (sure, it can make shows that include racist lines or stereotypes, but only if there’s actually a point behind them – which wasn’t the case in Top Gear). But if the BBC isn’t allowed to gently and non-scornfully mock tragic events that occurred more than 60 years ago, then it might as well close its comedy department for good, and focus solely on pleasing mad arseholes who wouldn’t understand a joke if it bit them on their, erm, mad arsehole.