How much is the ihug brand worth? Surprisingly, this is a question being asked by Slingshot GM Mark Callandar who told me yesterday that he would happily buy the ihug name off Vodafone.
“We’ll buy the brand off them if they don’t want it. ihug were the original pioneers of internet in New Zealand and clearly Vodafone don’t want it.”
Callandar was referring to the company’s new fixed-line free broadband offers that are being marketed under the Vodafone brand name. He says this is a clear signal that it won’t be long before the ihug name disappears from the local telecommunications landscape.
He says that the ihug brand has a core of loyal customers who’ve been with the ISP since the beginning and who are likely to be alienated if the ihug brand is subsumed by Vodafone.
So I phoned up Mark Rushworth, CEO of ihug, to see what he thought of Mark Callandar’s offer. He burst out laughing and suggested that maybe this was an indication the Slingshot brand wasn’t working for them so they needed the ihug name.
Rushworth said the reason that Vodafone marketed the new plans under their own brand was because they had an existing customer base of two million and it made sense to pitch the broadband deal to them. But he admitted that there are plans “at some point to bring the two brands together.” There is no final date but “at some point it will happen.”
As an example of how the Vodafone/ihug brand will be managed in future, Rushworth cited TelstraClear, where the paradise.net email address still exists but all the deals, billing and customer services are done under the TelstraClear name.
Customers signing up to Vodafone’s fixed line broadband deals today are put through to ihug and given an ihug.co.nz address. But as general users become more sophisticated and start to use their own domain names, an ISP’s brand in an email address will become increasingly historic.
I asked Rushworth if the ihug name was put up for sale, how much he thought Slingshot should pay for it. He replied that the price was $41 million but as they didn’t buy it last year, they obviously couldn’t afford it.
He said in the end what matters isn’t the name; it’s the people and culture of an organisation.
“Brands come and go but people and culture remain the same.”
As it he said these words it felt as if something that is quite small but very precious had rolled over and died. RIP ‘ihug’.