Jersey’s Competition Authority’s fine Thomsonfly. What message are we trying to send!?

It’s been a bit quiet on the blogging front for the past few weeks. But rather like London buses, you have nothing to write about for weeks and then 3 stories come along at once.

Firstly, there’s the mighty JCRA levying a crushing fine of, wait for it….. £10,000 on TUI (parent company of Thomsonfly) for failing to advise them back in September of their acquisition of First Choice. Apparently, because Thomsonfly were flying to the island, they should have advised the JCRA in order that they could assess the competitive effects of the acquisition.

Despite the fact that the JCRA has no power to order TUI not to proceed with the merger (as if that would make a difference!), they still decided to fine them for an administrative oversight. What sort of message does this send to other airlines or businesses we are desperately trying to attract to Jersey? I hope the £10k fine which is going to the States will be handed over to Jersey Airport to use for marketing activities.

Ferries – separating fact from fiction

Two ferry stories in the past fortnight which are probably non-stories.

1. The Daily Telegraph reported on 24th January that Condor Ferries was to be sold on by Royal Bank of Scotland (the report has not been confirmed or denied by the company). However, as Rob Provan their chief executive has pointed out, it has no impact on the business. RBS bought Condor from ABN Amro just 3 & ½ years ago, so presumably this is about realising some nice profits rather than any issues to do with the business.

2. HD Ferries, who have always been good at spinning stories, announced on Monday this week that they plan to start services to the UK in direct competition with Condor. Whilst there is no exclusivity, there is a service level agreement and common transport policy with Guernsey that would require both a back-up traditional ferry service and probably another high-speed craft. Their chief executive, Christopher Howe-Davies suggested that the announcement about Condor’s sale would unsettle travellers. How so?

So competition is already hotting up and HD Ferries have not even started their St Malo service yet! By the way I wonder whatever happened to HD’s announcement that they were going to sue Condor (see previous blog)?

Jersey Tourism PPP – Economic Development release final proposals

The creation of a new marketing organisation for Jersey, based on a private public partnership, is possibly the single biggest change in the tourism industry for over two decades. It’s surprising therefore that the release of the final proposal document has taken place without so far a word to the industry from either of the two sponsors. You can download a copy by clicking here.

Locum Consulting were commissioned by the States of Jersey to produce a paper outlining the form that the new organisation could take and how it would function and be resourced. The process has taken a couple of years and has resulted in the production of this final report which has been endorsed by both Mike King, chief executive at Economic Development and Gerald Fletcher, chief executive of the Jersey Hospitality Association.

The new organisation will be called ‘Marketing Jersey’ and will be a non profit-making limited company, controlled by an independent board of directors and funded through the combination of a States grant and private sector finance, raised through membership fees.

Overall, I support the proposals, although I have concerns on three issues:

1) It is proposed that the Board will be made up of 11 individuals – this looks too big to me and could become turgid and incapable of taking effective decisions. A maximum of 8 board members should be the target.

2) The structure of the executive groups – why split prestige and traditional holiday markets into separate groups? The skills required to market these products are the same. Combine the two into one group otherwise the marketing manager is going to be pulled in different directions by separate group chairmen.

3) The biggest concern is funding. According to the document, the JHA have been tasked with bringing forward membership fee proposals – members need to see these proposals before agreeing to go ahead. Moreover what guarantees are there on States funding? Whilst there is a 3 year rolling deal, Treasury will presumably be looking to achieve a phased reduction in the grant provided and there will need to be safeguards in place to ensure that the total pot does not keep falling. There seems to be no guarantee of this within the proposal.

I would urge everyone directly involved or associated with our industry to download the document, digest it and give your feedback to Economic Development and the JHA – which I am sure they would be keen to receive. You can also vote in the poll to the right of this post.

Economic Development want to see the new organisation in place in time to take on 2009 marketing. But in my opinion the industry needs to make sure we have the right organisation with a secure funding structure in place before we commit to such a fundamental change.