Friday, February 4, 2011

Egypt's Bad for Business

http://www.foxbusiness.com/markets/2011/02/03/telecoms-hedge-bets-amid-internet-blackouts/




Opinion by Matt Blachowicz


In the previous posted article (see top) it talks about telecoms complying with Egypt's government amid the blackouts. If you haven't been up to date on Egypt's violence that has erupted here is a quick break down.

Egypt has shut down 90% of its internet and mobile traffic. This has caused many riots and protests by Egypt's people. Their leader shut down services "an effort to squash rising protests calling for the ouster of the autocrat dictator and hinder social media-based coordination efforts."

Many people are surprised that companies worked with Egypt's government in shutting down services. They claim Egypt was within their rights as a government to shut down services and was complying with the Telecom agreement. But when does a company stand up for its customers?

Even though they were “required” by law to shut down services, what would happen if they refused to? The government might make them shut down regardless but doesn’t that result in the same outcome? I understand there are laws and everyone must abide them. However, when does that line end? Companies have the option of leaving a country and doing business elsewhere. I assumed companies have a contract with their customers.

There has been a history of companies, who do work with governments going against people, having poor business after the disputes are settled. It would be smart for a company to go with the customers’ opinion. As the saying goes, the customer is always right. 

Customers are what drive companies to make money and provide services. They need our money to keep alive and pay bills. When is a company going to stand up for their customers and tell a government that our customers are more important to us than a contractual agreement?  Guess that day is still on the horizon.

-Matt Blachowicz

3 comments:

  1. I believe that the company also had to be careful to not completely lose their customer base in Egypt. The company is probably hoping that the government will reinstate the internet, but if the company disagrees with the government, they may be forced out and not allowed back in when the government does allow internet again. This company also has to tread lightly because if other governments see that this company argued with the Egyptian officials, then other companies may be hesitant to allow that company into their country. I agree that a company needs to work for their customers, but they may be hurting their company more in the long run and lose being able to help even more customers if they go against the government now.

    Casey Zimmerman

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  2. The nation of Egypt is in a state of emergency and in order to prevent potential violence from rallies the government has shut down internet. I believe that the government would have found some way to take down the internet regardless if providers complied with them or not. In the long run, it may be worth the internet businesses to lose a few customers from shutting down the internet over possibly being refused to conduct business in Egypt at all. An internet company would not want to risk making a bad name for itself in the eyes of Egyptian officials, because foreign governments may not be as business friendly as in United States. However, these organizations may want to assess how they believe these uprisings will result, because in reality the outcome of events in Egypt could dictate the future of some of these internet providers. If the people rising against the government prevail, then they may not purchase products from companies that cooperated with the internet shutdown. However, if the current leadership holds power, then the businesses may still retain a strong customer base and be rewarded for assisting the current government regime. Either of the outcomes will more than likely result in internet providers discovering difficulty in the reestablishment of their triple bottom lines and sustainable business standards for the fractured customer base. Overall, Egyptian internet companies made the right decision in complying with the current regime because, unless the rioters prevail and new administrative rule is implemented, government still retains more power than people in this region of the world.

    Zach Seibel

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  3. Would you guys use a internet source though that shut down and compromised with a government that you didn't support? We all can mostly agree that they would have most likely shut the internet down regardless if they tried to keep it running or not. However, they lose customers and revenue either way. Why not try to keep it running for as long as possible and then if they get shut down they are back at square one. Hypothetically speaking, lets say their only customer base is in Egypt. They get shut down and no more company. If they comply with the government they lose their customer base when the internet gets reconnected. Either way I see them losing the marketing value. If they would have tried to keep it going, they could at least adhere to the customers who wanted to keep it going.

    -Matt Blachowicz (Group 5)

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