Atlas TG - in and out of the Maltese ICT map
The rise of the information society in Malta is one of the biggest achievements for the country. There are many success stories to speak of, but there are also failures, sometimes unexpected, given the hype that surrounds this sector of the...
The rise of the information society in Malta is one of the biggest achievements for the country. There are many success stories to speak of, but there are also failures, sometimes unexpected, given the hype that surrounds this sector of the economy.
The story of one particular ICT company is being kept in mind as warning for all and sundry that success does not come by itself. You need to have a good idea, sound planning and work hard to achieve it.
This wasn't the case of Atlas Technology Group (AtlasTG), a provider of outsourced software support services for custom applications to clients with large IT functions worldwide.
A few weeks ago the company said it was folding, just two years after it commenced its Malta operation with quite some fanfare and with the blessing of the Minister for IT. The 600 ICT jobs the company said it would create never materialised.
AtlasTG, a subsidiary of Tribeworks Inc., opened three offices in Malta, New Zealand and Seattle, renting expensive office space and apartments to house hundreds of employees.
At the launch in September 2006, journalists were told: "The company uses state of the art proprietary processes and monitoring systems. The company's directors have stated their commitment to develop the industries' highest levels of support worldwide, through strong investment in people and technologies. The company has already recruited 20 employees, 12 of whom are Maltese, in its pre-launch stage and has invested $4 million (€3 million) in its start-up phase."
Set-up by a trio of veteran Microsoft executives, prospects looked good. With little effort it managed to rope in the Maltese government and became one of the long list of companies that fed the government's public relations exercise.
In reality the company did not have the necessary investment capital, tools or clients, and the low volume of work never brought the recruitment of 600 ICT workers. The large offices rented out in Gzira never hosted more than a few score employees.
For the first two years employees worked to create the tools to start providing the services. Then after two years the first clients started to arrive but they were not the large corporations it had hoped for. Though AtlasTG tried hard to get a contract of Microsoft US it never managed to get the lucrative project as it was not a Microsoft certified vendor. This landed AtlasTG in deeper financial trouble.
One of the most obvious cases of mismanagement concerned Atlas University. When AtlasTG opened up in Malta it wanted to recruit more than 900 employees. Even at that time, the number was considered ludicrously high and it was toned down to 600, which was still a considerable figure which the Maltese skills market was not in a position to support. This led to the idea of having an Atlas University that would create the necessary skills pool with the support of the Maltese government, which was also driving ICT skills training.
i-Tech is informed that while the Maltese government was willing to support such an initiative, AtlasTG failed to make the case, especially in terms of its financial sustainability. Basically AtlasTG wanted several guarantees that a responsible government would never give. It continued to promote the university at least up to the IT exhibition at MFCC in Ta' Qali last year. The agreement was never signed.
This happened while all attention was focusing on the new SmartCity project and AtlasTG was thinking of tying up with it. "We want to be one of the first ICT specialists to publicly declare our intention to be one of the first tenants in Smart City," said Robert Altinger, executive chairman of AtlasTG. However i-Tech can confirm that no official serious discussions were ever held with SmartCity Malta.
AtlasTG was not discouraged and forged ahead, even hiring a foreigner with a very high salary compared to Maltese standards to start the university project. However it never materialised and this person was fired.
There were also problems at senior management levels, with distrust running deep between the high-ranking officials. Though some of them were really capable people with vast experience at senior positions in other international ICT companies, others made mediocre managers and ultimately are to blame for failure.
A New Zealand news website, The Dominion Post, recently revealed that the company lost US$3.4 million on revenues of $396,000 during the six months to June 2008. These results led to an immediate consolidation of the Seattle office at the expense of the closure of the one in Malta. Furthermore Michael Murphy, the chief executive officer and one of the co-founders, resigned. He was one of the most talented persons at the company, brought down by the overall mismanagement.
Atlas' shares are traded on the over-the-counter (OTC) market in the United States, where the firm is valued at US$6.4 million (€5 million), but have fallen from a peak of $1.30 in January to 16 cents, the news website added.
In August AtlasTG announced that while providing worldwide 24/7 support, the company has also realigned the applications support staff to better serve the bulk of the current business, which is in North America. A new support centre and corporate headquarters was opened in Seattle.
"The present customer base while requiring 24/7 support does not generate the volume of night time (US) workload to properly utilise the Malta support centre. The company has closed the Malta support centre. The New Zealand support centre will continue to provide off hours support in North America in addition to support for the Asian markets."
Seattle-based technology operations director Michael Hughes believes AtlasTG is poised to benefit from the global economic downturn, as cash-strapped firms look to outsourcing to cut costs, and is for the first time trying to sign up customers in New Zealand to complement its six United States clients. These include a shoe retailer and a company that provides content for mobile phones. However these are a far cry from Microsoft and the other big guns the company wanted to attract. Whether it succeeds or not, it will be far away from Malta.
The story of one particular ICT company is being kept in mind as warning for all and sundry that success does not come by itself. You need to have a good idea, sound planning and work hard to achieve it.
This wasn't the case of Atlas Technology Group (AtlasTG), a provider of outsourced software support services for custom applications to clients with large IT functions worldwide.
A few weeks ago the company said it was folding, just two years after it commenced its Malta operation with quite some fanfare and with the blessing of the Minister for IT. The 600 ICT jobs the company said it would create never materialised.
AtlasTG, a subsidiary of Tribeworks Inc., opened three offices in Malta, New Zealand and Seattle, renting expensive office space and apartments to house hundreds of employees.
At the launch in September 2006, journalists were told: "The company uses state of the art proprietary processes and monitoring systems. The company's directors have stated their commitment to develop the industries' highest levels of support worldwide, through strong investment in people and technologies. The company has already recruited 20 employees, 12 of whom are Maltese, in its pre-launch stage and has invested $4 million (€3 million) in its start-up phase."
Set-up by a trio of veteran Microsoft executives, prospects looked good. With little effort it managed to rope in the Maltese government and became one of the long list of companies that fed the government's public relations exercise.
In reality the company did not have the necessary investment capital, tools or clients, and the low volume of work never brought the recruitment of 600 ICT workers. The large offices rented out in Gzira never hosted more than a few score employees.
For the first two years employees worked to create the tools to start providing the services. Then after two years the first clients started to arrive but they were not the large corporations it had hoped for. Though AtlasTG tried hard to get a contract of Microsoft US it never managed to get the lucrative project as it was not a Microsoft certified vendor. This landed AtlasTG in deeper financial trouble.
One of the most obvious cases of mismanagement concerned Atlas University. When AtlasTG opened up in Malta it wanted to recruit more than 900 employees. Even at that time, the number was considered ludicrously high and it was toned down to 600, which was still a considerable figure which the Maltese skills market was not in a position to support. This led to the idea of having an Atlas University that would create the necessary skills pool with the support of the Maltese government, which was also driving ICT skills training.
i-Tech is informed that while the Maltese government was willing to support such an initiative, AtlasTG failed to make the case, especially in terms of its financial sustainability. Basically AtlasTG wanted several guarantees that a responsible government would never give. It continued to promote the university at least up to the IT exhibition at MFCC in Ta' Qali last year. The agreement was never signed.
This happened while all attention was focusing on the new SmartCity project and AtlasTG was thinking of tying up with it. "We want to be one of the first ICT specialists to publicly declare our intention to be one of the first tenants in Smart City," said Robert Altinger, executive chairman of AtlasTG. However i-Tech can confirm that no official serious discussions were ever held with SmartCity Malta.
AtlasTG was not discouraged and forged ahead, even hiring a foreigner with a very high salary compared to Maltese standards to start the university project. However it never materialised and this person was fired.
There were also problems at senior management levels, with distrust running deep between the high-ranking officials. Though some of them were really capable people with vast experience at senior positions in other international ICT companies, others made mediocre managers and ultimately are to blame for failure.
A New Zealand news website, The Dominion Post, recently revealed that the company lost US$3.4 million on revenues of $396,000 during the six months to June 2008. These results led to an immediate consolidation of the Seattle office at the expense of the closure of the one in Malta. Furthermore Michael Murphy, the chief executive officer and one of the co-founders, resigned. He was one of the most talented persons at the company, brought down by the overall mismanagement.
Atlas' shares are traded on the over-the-counter (OTC) market in the United States, where the firm is valued at US$6.4 million (€5 million), but have fallen from a peak of $1.30 in January to 16 cents, the news website added.
In August AtlasTG announced that while providing worldwide 24/7 support, the company has also realigned the applications support staff to better serve the bulk of the current business, which is in North America. A new support centre and corporate headquarters was opened in Seattle.
"The present customer base while requiring 24/7 support does not generate the volume of night time (US) workload to properly utilise the Malta support centre. The company has closed the Malta support centre. The New Zealand support centre will continue to provide off hours support in North America in addition to support for the Asian markets."
Seattle-based technology operations director Michael Hughes believes AtlasTG is poised to benefit from the global economic downturn, as cash-strapped firms look to outsourcing to cut costs, and is for the first time trying to sign up customers in New Zealand to complement its six United States clients. These include a shoe retailer and a company that provides content for mobile phones. However these are a far cry from Microsoft and the other big guns the company wanted to attract. Whether it succeeds or not, it will be far away from Malta.