q4 positive cash. as good as a warnie wrong un, page-21

I will keep a watch. I presume you mean on FRE announcements regarding Tesco? I trust you are hinting at something positive on the way? If you know more please tell more.

There is however no way that I can be convinced that FRE has a future income stream coming from Tesco customer signups. If there was just the slightest glimmer of a hope that was true then you would have seen an announcement from FRE to that effect. FRE is DESPERATE for some good news like this and it just does not appear to be there.

Don't misunderstand my intentions on highlighting the apparent financial failings of ENG & FRE. I am shareholder in MNF and as such I clearly believe in VOIP.

If I am to see my MNF share price go up significantly, irrespective of competition, I need to see the whole Australian marketplace adopting this technology en-masse. Frankly, if it was just MNF promoting the technology then it would not be a big enough marketing effert to get the message out there.

Take the example of ENG with it's 68,000 active customers, it has spent by any estimate about $10M in advertising to attract this customer base. MNF in 2 years has built a 60,000 customer base with no marketing. The question is, if MNF did not exist, would ENG now have 128,000 customers? No would be the simple answer, market reach thru increased distribution irrespeective of the advertising medium is the real answer. More VOIP companies means more VOIP customers connected.

I would also suggest that ENG wasted at least half it's advertising dollars because of it's stupid, irrelevant trading name, Engin, I mean how does that indicate phone service? Just looks like Engine spelt incorrectly and people will never get the association of a car engine out of their heads. Optus & 3 also have stupid names but they spent hundreds of millions advertising to us until it was drilled in. Engin never had a chance with it's budget. MyNetFone is a reasonable name, at least it is obvious what it does. Even Freshtel is a good name. Pennytel, GoTalk, etc, all good starting points.

I want to see competitors to MNF get up and push the VOIP story out there to the great unwashed. I think ENG is the company that is most likely to recover from it's current ills but sadly for ENG shareholders I believe that based on the current financial metrics and with Seven as the largest shareholder that Seven will end up taking this over for a song. Very likely on the back of a large Seven underwritten placement like we saw this year in March.

If FRE had spent even 1/2 of it's losses over the last 2-3 years on advertising & direct customer marketing instead of developing technologies in the Freeware App space and not paying out millions PA to it'd directors and senior staff it could have done the hard yards and built a client base of say 30-50,000 by now. Instead they chose the corporate route, trying to attract customers thru resellers and lining up with Tesco to waste some time and resource there. Don't get me wrong, if the Tesco deal had of been inked correctly then FRE would be making good money from this, if the Tesco offer to consumers was compelling, which I am not convinced of.

Why did FRE take this route? Simple, just look at the people at the top, all corporate type people. They only want to deal with their own kind, not the $20 PM VOIP man on the street.

Look at the top guys at MNF, a pair of electronics engineers. Sure they held senior corporate positions at Lucent before starting Symbio/MNF but once an engineer always an engineer. They don't understand marketing, engineers fix and invent things and they work hard. They are smart and use spreadsheets and add numbers up quickly in their heads, they are always thinking. They wanted to sell to the man on the street and they set about ways of finding a marketing route to this customer base.

The best thing that could happen for VOIP growth in Australia right now is for Seven to take over ENG and push the hell out of VOIP to normalise VOIP takeup in the eyes of the general public. Whatever package ENG/Seven will push will allways allow room for competition to sell under or around.