Island Life by David Slack


Fancy running an online business? Like to become an electronic Arkwright? Very good idea. You can go to the gym while everyone's at work, you can walk down to the beach when your brain slows down, and you can visit the Letterman site any time you like. I've been doing it for almost a decade, and you'd have to prise the mouse from my cold dead right hand to disconnect me now.

If you live in New Zealand, though, you might want to make one small change to your life before you open up for business: move to another country.

Oh, alright, it's not that bad, but there are moments…there are moments…

If you're a customer at (and if you are, thank you once again for choosing us) you'll see that we gladly accept Mastercard and Visa and charge you in US dollars. We do this because 7.6 times out of 10, that's where you come from.

Here's where it gets interesting. I'd have liked to have been able to offer just such a system from the day the website began. But in 1995, when I first opened a credit card merchant account, the best you could do was to get your customer to fill in the online order form, take their credit card number from that order, ring up the bank and get an authorisation, write out a voucher charging them the New Zealand dollar equivalent of the US dollar rate that was quoted on the site, take it to the bank, and wait for the occasional disgruntled email from a customer who was bewildered by the figures on their credit card statement.

Worse, they didn't get access to the site (for this is what we sell) until I'd received and processed the order. People want to be able to tap in their card number and get what they've paid for right away. So I kept looking for a better alternative. Back then there was no IBill, no CCBill, no WorldPay, nor any Internet card processing entity like that available, however I did manage to track down a division of AT&T in the US that was just getting underway. It would provide a 900 number that would issue your customers with a password for instant access and charge it to your phone bill.

It was great. As soon as I hooked up to the 900 number system, sales rose. It came at a price, though. Instead of credit card commission of around 4%, you paid 20%. And it was primitive by today's standards; there was a guy in Florida who you'd email once or twice a week to get an update on sales. Still, it was the right step in the right direction. That particular operation grew up to become IBill, and a whole host of other entities like it sprang up as well.

Back in New Zealand, though, things moved more slowly. I'd keep asking the banks the same question: "Can you do real-time credit card processing?"

They'd keep telling me the same thing.

"Not yet."

"Too expensive."

"Not enough demand."

Finally, though, just a little while before Flying Pig took off and eVentures soaked the local punters, we got some action. BNZ and ASB both set up real-time online credit card processing services.

Better yet, one of them set up a system that was straightforward to deal with. Do a reasonably quick bit of coding, and you're in business. Unfortunately I discovered this only after first signing up with the other one.

So now I'm rolling along happily with BNZ Buyline, but there's still one part of the job left to be done, and that's the problem of charging the customers in their own currency.

So I asked them: "Can you do charging in US dollars?"

They'd keep telling me the same thing.

"Not yet."

"Too expensive."

"Not enough demand."

But then it happened. MultiCurrency options! Twelve to choose from! You can see me here burbling about it like a happy child at Christmas.

But Christmas doesn't come every day of the year.

I don't especially care to complain about this because at least BNZ have actually managed to offer this service, which is more than any of the others have bothered to do, and they're nice, helpful people running the service.

Trouble is, it aint working properly.

It times out. Quite a lot. This is not something you look for in a real time credit card processing service.

I've had to write in a couple of extra layers of processing to handle this so that, whether or not Buyline is down, things still go on working as usual for the customers - no, Mr Hacker, I won't tell you what they are - so you might say that I'm not inconvenienced.

But that's not exactly true. I had to rewrite a big chunk of code just before Christmas last year to change the way I hooked into Buyline, in order to help them take some load off their server. I could have done without that.

It's simply wrong in principle that a product should be quite so flawed. The reason, as far as I can gather, is one that should make senior people in the BNZ abashed. The system is running on old hardware, using old software on an old platform, coded in a language that no-one on the staff there today is able to deal with.

Anyone would think they were short of dough.

Now, one problem doesn't really constitute a substantial impediment to E-commerce, but I offer this as just one example of something that looks more to me like a systemic shortcoming in New Zealand.

Where's the forward thinking?

We've watched a fairly unedifying property boom unfolding over the last couple of years and all the banks have come up with plenty of money for that. Nice and easy. No thinking required. Done it before. Just clip the ticket on a whole lot of people getting greedy and stoke up the whole engine a bit more.

And don't get me started on Telecom.

Us electronic Arkwrights don't count for much in the eyes of large enterprises here, nor, I would argue, in the eyes of an army of Wellington bureaucrats - sorry, analysts - principally because they see us making only a tiny proportion of the GDP.

Well, fair enough, we might not all be bound for glory. But Amazon and Google were small once. We have a dollar pushing US 70c and that's too tough for a lot of our exporters. But guess what? Some of the little guys are coping with it pretty well. I've been pedalling hard for the last couple of years to expand the product range and lift revenue. That's given me a lot more room to move when the dollar goes up, and I'm not the only one.

In the long run, isn't it a better scenario for the economy to comprise a large number of businesses that can trade competitively even when the dollar is high?

We know that we're tyrannised by distance. How smart is it to make it hard for the very businesses for whom distance causes no problem?

I don't dwell on this much, but sometimes it just gets to me a bit. And when that happens, I go to the gym, or visit Letterman, or take a walk down to the beach.