Mining Hardware Company Alpha Technology: Bad Luck or Bad Business?

Journalist:
P. H. Madore @bitillionaire
June 5, 2015
Alpha Techonlogy

CCN received a tip from a customer who was very, very unhappy with an often unmentioned Bitcoin mining hardware outfit, Alpha Technology. Here is what he said:

This story is the same as KnC’s some guys claiming they could produce a scrypt miner and that they were based in England. I ordered back in May 2014, since then all we get are emails about every 3 months telling us thank you for our patience and that they’ll finalize soon. When contacted they refuse all requests for refunds and often times they ignore your emails.

Here the informant is clearly referring to the methodology and stall tactics employed by KnC miner, who, judging by the feedback from this journalist’s article about KnC, have more dissatisfied customers than actual fulfilled orders.

Pre-Order or Vaporware Scam?

The deal with Alpha Technology is, like happens too often in the mining industry, they are not selling a finished product. They are selling a promise of one, and like with many technological products, they are far behind schedule.

The rub with them is that they have a rather egregious policy of refusing refunds if a customer waits a certain amount of time to ask for one. After that point, the customer must either get their order fulfilled or get screwed, one or the other. It seems whether or not the latter will happen is up in the air, as, according to Alpha Technology, they’re close to finishing their promised product. The is the response this journalist received when he inquired of Alpha Technology about their seemingly unfair refund policy. Writing on behalf of Alpha Technology is Mohammed Akram, the “managing director” of the company.

[…] if a customer is eligible for a refund as per our refund policy we refund them. However if they have an existing order their order will be fulfilled and shipped.

We are ironing out some current technical issues, but we are sure to start shipping soon. With the highly technical nature of our product, delays are bound to happen. We are glad to have working chips which was the longest and most costly aspect of the project, now it is just about mass assembly and putting the hardware together. Updates on our website are regular.

Closer inspection reveals that this Akram is actually the founder, and likely only employee, of the company. He claims to be “a graduate in Electrical and Electronic Engineering whose goal was to provide innovative and specialised hardware to the cryptocurrency industry,” yet is “outsourcing the physical and technical engineering including the design and manufacturing of the devices” of the upcoming Scrypt ASIC miner. Interesting.

The astute reader will certainly be asking: what does eligible for a refund mean? The policy is specifically designed to lock the buyer in if their suspicions are not raised soon enough. From their website:

Within 0-1 month after receipt of payment: Full deposit will be refunded. Within 1-3 months after receipt of payment: 75% of the deposit will be refunded. Within 3-5 months after receipt of payment: 50% of the deposit will be refunded. Please note a cancellation fee of £70 towards handling charges will be applicable along with any cancellation.

What right does the company have to keep any of the money if they fail to deliver? As you can see, this policy encourages the buyer to stay locked in, until it’s too late, and by the terms of their policy, though certainly not under the eyes of the law, the company gets off freely with the money.

Also read: Is Butterfly Labs Liquidating Its Assets?

If an order is not delivered a year later, how is this not “eligible for a refund”? In what world is this an acceptable period of time to keep a customer waiting? Imagine going to a McDonald’s, ordering their latest product, and waiting more than a day for them to deliver it. They would give you a refund and your order. Furthermore, when we’re talking about mining equipment, we’re basically talking about an investment. The time has long past that any acceptable Scrypt mining might earn a return-on-investment.

The world is not a Kickstarter campaign. Pre-orders have come to ruin the mining industry with broken promises and stolen money. A group of disgruntled customers has gathered at a site called FightAlpha.net.

As to you, dear reader, remember that a smart man learns from his mistakes, but a wise one learns from the mistakes of others. Never pre-order something that doesn’t yet exist. If it’s out of stock, that’s another story. But if they haven’t even finished it yet, your chances of losing your money by pre-ordering seem higher than the opposite.

Last modified (UTC): June 6, 2015 06:52

P. H. Madore @bitillionaire

P. H. Madore has written for CCN since 2014. Please send breaking news tips or requests for investigation to bitillionaire+phm@gmail.com. He lives in Maine, USA. A single father of four young children, he does not discourage financial donations, provided they do not come with strings attached.