Telecom New Zealand has announced it is closing its high profile online shopping portal Ferrit, after deciding the venture was going to take too long to make money.
The company claims the current "tough retail environment" had shifted forward the break-even point for the business by a number of years.
Telecom won't say how much Ferrit.co.nz has cost the company, but industry experts have estimated an investment of over $30 million since the website launched in 2005.
Ferrit aimed to become the first-stop for New Zealand online shoppers, consolidating products from a wide range of local retailers into a single basket.
Telecom is trying to talk down the disappointment of the website's failure, claiming the telecommunications giant was in the game for more philanthropic reasons ;-)
"Telecom's aim in launching Ferrit was to help develop New Zealand's online retail market," said Alan Gourdie, Telecom's retail chief executive.
"Since 2005 we've seen a growth in retail adoption of online with many retail players adopting ecommerce and web capabilities."
Many online commentators were sceptical of Telecom's ambitious plans, and were dubious whether Ferrit's business model would ever be a huge success in the New Zealand market.
The closure of Ferrit will mean the loss of 24 full-time jobs, and 13 contractors.
But journalists have shed little tears for the end of the website. A report today from NZPA noted that...
"Journalists based across the road from the Ferrit offices in Auckland during the set up phase had a good view of the busy emerging new business.
Ferrit staff's ability to play ball games while speaking on mobile phones was envied..."
Posted at 5:46 pm