Asia Online centralised to Sydney

Asia Online's New Zealand operation is to be scaled back to branch status, with most activities to be run from Sydney.

Asia Online's New Zealand operation is to be scaled back to branch status, with most activities to be run from Sydney.

Major changes were outlined yesterday in a memo to staff from Asia Online's CEO for Australia and New Zealand, Pascal Grant. At least four staff will go under the restructuring, including general manager Hugh McKellar.

McKellar was general manager under the ISP's former incarnation, Iconz (the Internet company of New Zealand) when it was purchased by Asia Online in April last year.

Iconz was Auckland's oldest commercial ISP, and had been providing service since 1993. McKellar is credited with bringing stability back to the ISP after some bumpy times when Melco New Zealand bought it from its founders in 1995. It has a mix of business customers – including New Zealand Post and IDG Communications – and residential users, most of whom have been with the ISP since is early days.

McKellar will oversee the transition to the new structure until the end of January and will then give way to Kevin Francis, who in the role of New Zealand branch manager, "will manage the operations and sales activities of the NZ branch," according to Grant's memo.

Customers will be officially informed about the changes later this week.

McKellar says that although the restructuring plans "the whole Australasian business model" has been considered in the restructuring.

"We were structured to run as a stand-alone country operation, but since we were sold to Asia Online we were part of a wider network and we're probably just not need at the level that we're at."

New Zealand will now largely be a sales base and will also host what the company defines as "level three" customer support.

"And we'll also have some delivery capacity which will be augmented by the regional skills available," says McKellar. "Our people will be used in regional roles as well. It's kind of centralisation with local representation."

The restructuring appears to represent a pulling back from a spell of rapid expansion, which the Softbank-controlled Asia Online, under the control of American Kevin J. Randolph, bought up a string of second-tier ISPs throughout the region.

While the New Zealand company received an initial burst of funding for new systems and training, and held its existing business, Asia Online's regional plans for ASP services based on thin-client devices connecting to data centres appear to have made little impact here.

Grant's memo also notes the appointment of Asia Online stalwart Indy Gunawardhana to the Australia and New Zealand management team, saying that Gunawardhana "will drive the march towards a profitability in the ANZ operation by the development of processes and systems to ensure that we meet our targets."

One spin-off of international ownership – share options – appears to have been denied to management staff who finish before Christmas. IDGNet understands those staff, who were offered lower salaries in exchange for the promise of options, will leave the company too soon to qualify.

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