NBR report says Orcon may need some help

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freitasm

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#141014 27-Feb-2014 07:24

NBR report (paywall): "Taxpayer money at risk as Orcon reaches out for help":

...which is understood to have stumped up at least $10 million of debt as part of a secretive sale process last April.

So Orcon is in the crap and for sale according to the NBR. The consumer ISP market really is a super low margin bloodbath.

— Steve Biddle (@stevebiddle) February 26, 2014

@freitasm @stevebiddle ISP market was always going to consolidate once UFB got moving. Orcon now looks like the necessary sacrifice

— Bill Bennett (@billbennettnz) February 26, 2014

waikariboy

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#995282 27-Feb-2014 09:50

Get this when i click the link.
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If you don't yet have an NBR membership you can subscribe below. The easiest way for subscribers to stay logged in is to click the "Remember Me" option on the Member Log In box on the top right of this page.
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Balm its gone!

surfisup1000

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#995288 27-Feb-2014 10:04

IP connections are largely a commodity now.

In the past, there would be a ton of value added services that could be purchased. But, now that bandwidth price has collapsed and the huge power of end-user devices (a smartphone can beat a grandmaster chess champion now) all people want is an IP connection point.

Anyway, it is sad to see companies go under but failure is an essential part of an economy. Maybe the next 'xero' could arise from the ashes of orcon???

freitasm

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#995300 27-Feb-2014 10:06

waikariboy: Get this when i click the link.
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If you don't yet have an NBR membership you can subscribe below. The easiest way for subscribers to stay logged in is to click the "Remember Me" option on the Member Log In box on the top right of this page.
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As I said, behind the paywall...

nakedmolerat

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#995302 27-Feb-2014 10:13

Dotcom can front that amount of money for them.

Groucho

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#995361 27-Feb-2014 11:06

nakedmolerat: Dotcom can front that amount of money for them.

Perhaps Dotcom could buy it as he's currently the face of Orcon? An ISP would compliment his MEGA business well but may run him into trouble with the electoral commission with his party.

Lyderies

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#995387 27-Feb-2014 11:30

So no more Orcon?

Goddammit i like Orcon

I'm going to noob myself past judgement

ubergeeknz

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Vocus

#995391 27-Feb-2014 11:34

It's as simple as raising more capital to fund expansion... not sure why it's being blown so out of proportion.

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FireEngine

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#995434 27-Feb-2014 12:23

Lyderies: So no more Orcon?

Not even the NBR article claims that!

From Greg our CEO. Just added to the comments of the NBR article…

“Can I suggest a more appropriate headline: “Orcon looks to attract fresh capital to continue strong growth path”.

Gross acquisitions have grown by more than 26 percent in the last quarter and 70% of those acquisitions have been for one of our unlimited plans. EBITDA is strong, ARPU is up, as is our Net Promoter Score, and our customer churn is at its lowest in over three years.

In response to such a speculative headline; Orcon is up to date on all current lender arrangements – the details of which are confidential so I can’t comment further. What I can say is that Orcon is seeing fantastic growth, which is why we have engaged Grant Samuel in the process to attract fresh capital into the business.”

Regards FireEngine

surfisup1000

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#995445 27-Feb-2014 12:31

"the details of which are confidential so I can’t comment further"

This is where the truth may be.

Companies never release dire news until it becomes absolutely necessary. Simply releasing bad news can damage the business further.

So, we cannot trust info coming out of orcon.

But, neither can we be sure the journalist is correct.

FireEngine

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#995454 27-Feb-2014 12:41

surfisup1000: So, we cannot trust info coming out of orcon.

But, neither can we be sure the journalist is correct.

Even the NBR article describes that impact as "could spell bad news for Kordia", not that it would be bad news for Orcon.

Personally I put information up here in good faith, if I post it, I believe it is correct. Take that how you like.

Regards FireEngine

FireEngine

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#995471 27-Feb-2014 13:09

http://www.stuff.co.nz/business/industries/9770911/Orcon-looks-for-more-capital

"Customer churn has gone down and average revenue per user is going up - which I bet is bucking the trend of all the other ISPs - and our brand preference is going up.

"The metrics you run an ISP by are all as healthy as they have ever been."

Regards FireEngine