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Editorial: Tough times for some

Editorial: Tough times for some

Just weeks ago, as distributors around the country totted up end of financial year sales figures, ARN reported a general mood of optimism in the IT channel. June was a bumper month for many, and a record for some, while the year as a whole was better than most since the dotcom crash.

But general market trends can't help all of the people all of the time, and the picture emerging from Melbourne-based Hallmark Computer International suggests things are far from rosy in its garden.

The PC assembler and peripherals distributor is believed to have parted company with almost a third of its staff since the end of last year and shelved expansion plans, at least for the time being, after closing offices in Sydney and Perth because of ongoing losses.

Given that the recent staff exodus includes a major chunk of the senior management team - CEO, director of operations, general manager of sales and marketing, and marketing director - it seems likely there has been a personality clash in the board room.

Reading between the lines, the in-fighting seems almost certainly to have been between company founder and chairman, Edward Ho, and former CEO, Garry Ganis. The latter only joined the company in December after a recruitment headhunt identified him as the right man to grow the business.

But it must be difficult as a company founder to hand over the reins of a business you have worked hard to build over a long period of time - 12 years in this case -- and (rightly or wrongly) Ho has obviously been unimpressed with the work of Ganis and his team. The question now is whether he can put together a new one capable of rebuilding the company's reputation and market position.

One thing in Hallmark's favour is that a name built over so many years does not crumble overnight. This is reflected in the position of the major vendor partners, which ARN sources indicate have maintained healthy relationships with the company. It also has its well-established whitebox range of Viewmaster desktops, notebooks, servers and audiovisual products to brag about. It claims to manufacture 20,000 systems every year for the Australian market.

While there are plenty of other local success stories in the whitebox market - with Optima and Ipex the most obvious - it is still a shame to see one of them going through a rough patch and it is to be hoped Hallmark can turn the corner sooner rather than later.

One company with less time on its hands and less history to back its cause is Simply Wireless.

The network integrator has blamed slow adoption of wireless technology as the main reason it has gone into voluntary admin­istration but is still hopeful of finding the necessary financial backing to get out of its current predicament.

It was very interesting to hear somebody in the wireless market shooting holes in the hype being driven by the major vendors. Market analysts and other industry experts ARN has spoken to have suggested the biggest problem Simply Wireless faces is being ahead of its time with some pretty cute uses of technology.

Innovation takes courage because it is easier in all walks of life to follow the pack. That is why the fruits of success are so sweet but the risk of failure so high.

Let's hope the market picks up quickly enough to make Simply Wireless one of the success stories rather than consigning it to the scrap heap.

Brian Corrigan is Editor of ARN. Reach him at brian_corrigan@idg.com.au


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