Why Seanet went bankrupt
Seanet Maritime Communications AB filed for bankruptcy on February 22. On 28 said all staff up to 22 March, all leave, except the three of us to keep the boat floating to a new owner takes over. There is a sadness that is not the death of friends long after ...
Seanet is the world's smallest GSM operator. At most, twelve employees and three agents connected to the company. We delivered maritime GSM, ie ferries, cruise ships, accommodation platforms and everything else during the relevant period a year find themselves in international waters, or the part of national water where we can offer our service.
Why did not this work? Should it work? The answer is that it possibly could work.
CAPEX
- Telecom is an activity that requires large investments and have low marginal costs, which is the recipe for large economies of scale. Seanet never came up to a volume of traffic that was sufficient to meet the costs of their infrastructure. The switch did many thousands of simultaneous calls - Seanet had a peak of just under 30. Seanet never really got the momentum in sales in order to achieve business plans, volumes would be required to bear the financial backpack.
- The infrastructure was probably not properly dimensioned for the business. I initially used equipment from a vendor, but stability was lousy and burnt by the experience of using a small, unknown supplier in conjunction with Chairman and CEO with a background from Ericsson, so it is understandable if the need for technical security primarily was with Ericsson. The infrastructure has been fantastic and Ericsson as the supplier's nothing to complain about, but the price has been disproportionate to the business was capable of carrying capacity and we have needed. If I had had the choice again, I had advocated that Seanet had chosen a solution from Tecore. Not only had they been able to use existing base stations from Ip.access (instead of having to make a change to Ericsson), and had gained a much less expensive gear, and had to buy a cheap SGSN from Aricent (ie an in-house produced GPRS service) and also had the bargain with a functioning prepaidlösning.
- Since there has not been relevant expansion capital, we have been searching lösningr that transformed CAPEX to OPEX. Leasing of antennas rather than buy. Own project where you yourself are not economically credible and the collateral on a boat is not easy to get to. In combination with the strategy change to indirect sales, there was then no provision for the leased antennas that we got back that the vessel was sold. The supplier of the leased antennas refused manage reduction of leased capacity and who also took payment for field service of antennas in stock because it is in the agreement as set Seanet with a current expense without corresponding revenues. A supplier who sneer banks' Agreement shall be held "in the mind of his client is no man shall buy from, but you could discover too late.
- A considerable amount of the proceeds of the IPO was put on development of a stabilized VSAT antenna. If you look at what happens to C2SAT you will see that it was a qualified felsatsning.
Funding
- Börintroduktion - an IPO is a prestigious project and a place on the stock market, some market benefits, but numerous disadvantages. The cost to be listed, the transparency that will result from that one is public and that the valuation is the audience. When shares slides from postage stamp to junk it will issue to the reasonable values hopeless. The issues leading to severe dilution if the share price was in a perpetual basis.
- Inadequate financing - owner never wants to be diluted so that it takes in as little capital as one affords. Seanet has hankat the front of the bridge loan. In connection with share issues have been brought in so little that the proceeds sometime in principle only covered the current stock of overdue payables, and a sugar stressed bridge financing. This has clear parallels to take SMS loan when money is gone and before the next paycheck comes and that the entire salary is booked once it appears.
Revenues
- Turn up the topline in a business case is the lightest available. If the top line is counted backwards to what you "need" to reach a particular result, it is on track to achieve minimal results. There have been clear hints of what we cautiously call "real optimism" in the context of budgeting.
Market situation
- One can of course do not blame anything but bad luck and bad timing when you are heavily exposed to Italy, Greece and to some extent also Spain.
- The road to the spin of the indirect sales went much slower than we had hoped. Three partners, which really only delivered as planned will require persistence, which has not existed. Basically, it is probably still correct, but practically speaking, it takes a lot more work to really drive this fully.
Naïve confidence in the price elasticity and promotion
- Seanet aiming for a lower retail price and negotiated discounts with mobile operators who in return undertook to lower the retail price. Seanet thus earned less per harvested minutes but there is no support in the statistics that this would stimulate consumption. Operators in the same country with drastically different price to the customer shows no statistically significant difference in consumption per person.
- A lower price is only an advantage to promote it. Seanet has marketed its services, but the effects of that people become informed rather have been that used the service less than more. Chances are that the knowledge of the price - even if it is lower than for competing services on the other boats - is too high for the general public will think it is reasonable.
The conclusion is that if there is price elasticity exists at least not in the price not forage where Seanets services sold, and you might as well take out as much as you can. Unfortunately.
The lack of revenue based on that Seanet acted in a manner that is perhaps morally right but economically fault falls squarely on me.
Competition
In Europe there are four providers of maritime GSM. There is no doubt that the volume is not sufficient to four to conduct a healthy business on its own merits. For example it is obvious that the infrastructure is an integral subset of the vessel (cabling) should be borne by the owner, but this has not been able to get through in the negotiations since the second offers to cover this cost. guarantees of "revenue share" to levels that are directly unsound is legion, but no guarantee of an industry that is thriving.












































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