According to recent reports, the town of Sutter California is simply not ready for the Twenty First century – one wonders if some of the more vocal inhabitants there were even comfortable with the Twentieth. This small town surrounded by farms about an hour north of Sacramento made it onto the map recently when parents rose up to shield their town from a new fangled technology in the form of high tech student ID cards. Concerned parents were horrified to learn recently that the school board (there is only one public school in the town) had decided to try out new ID cards for the students with imbedded RFID tags containing the student’s ID#.
RFID tags are small passive computer chips that can be powered up by a special coded radio signal and exchange small amounts of data with the reader. They are rapidly proliferating in every corner of the globe because they are cheap, need no batteries because they are passive devices, and are perfect for ID cards, inventory tags, and may eventually replace bar codes on boxes of cereal. In this case, the school principal’s plan was to require all students to wear the ID tags and install readers at classroom doors to make it faster and more accurate to take attendance.
Apparently the thought of each child having an electronic chip in their student ID card was just too scary a proposition to comprehend for this town of 2,885. Most of the ensuing uproar, which ultimately forced the project to be abandoned, was centered around privacy rights. Some even voiced concern about possible health effects of wearing the ID tag. News crews came from far and wide, interviewing the irate parents as they picketed the school. The ACLU even came, adding their usual rhetoric to the privacy debate, claiming that the badges made every child a “walking homing beacon to stalkers with scanners.”
Never mind that the badges contained an encrypted 15 digit ID number that could only be read by the school system. Never mind that a scanner that would work at a distance would be so bulky that that the “stalker” would stand out like a sore thumb. Never mind that thousands of companies around the world use the same system for their ID badges and also in smart cards that people carry in their wallets.
Clearly this was no longer a reasoned discussion – it had rapidly devolved into an emotional reaction to technology. Some parents even quoted passages from the bible.
But maybe the tone of this uproar is being misinterpreted. Surely these parents aren’t worried about the school knowing where their children are when they are at school. And for a small school such as this, chances are that most everyone knows each other anyway. I’d be willing to bet that if you asked 5 people at random, you could find out what your friend had for lunch.
Maybe the parents are really not so worried about stalkers in their neighborhood, and maybe most of these people are not really worried about walking near the scanner any more than they are worried about passing through the metal detector at an airport or the scanners set up at the entrance to clothing stores and drug stores. Maybe it’s something else.
What if they are really worried about the future and not the present? What if they are really worried that their next drivers license issued by the state of California will have such a chip imbedded in it? What if they are more worried about being tracked themselves as they go about their day?
Maybe an innocuous ID badge for kids is seen as the first small step toward a society where your every action is recorded by some system or another and each person is profiled and logged and tagged and tracked wherever they go. Now I’m freaking myself out.
Wednesday, February 23
Tuesday, February 22
“Lifetime” Guarantees for Technology
Ever since Tivo hit the market in 1999, it has been a tough uphill battle for them to achieve their growth goals. Some said that their problem was that the were trying to sell a product that came across as a very expensive VCR. Others said that you really had to have one in your home for a week or so before you appreciated how cool it was. Still others claimed that the idea of Tivo suggesting what you would like to watch was too weird for people to believe. Although all these are true to some extent, I think that the critical problem has been the subscription fee.
You see, the Tivo business model was built around a data connection between your machine and their servers. Not only did they use that to collect information on what people were watching, with a long range plan to sell that information to the networks, they needed that connection to update your onscreen program guide. Tivo made the strategic decision that they were going to provide it over a phone connection and charge $12.95 per month, (or you could choose a one-lump-sum “lifetime” subscription fee of only $300!). The subscription approach looks good on a business plan with a huge projected subscriber base, but how about all those people out there who already have that link set up through their cable or satellite subscriptions? Will they be willing to pay an extra $13 per month for the same programming information they already get? Tivo bet the farm that they would.
That $13 extra per month is precisely why I decided to get my first DVR two years ago through Dish Network, rather than commit myself to Tivo. I paid $189 for my Dish DVR (after rebate) and the normal $5 per month fee for the extra receiver (I think all cable and satellite plans charge you some small monthly fee for additional set top boxes).
What has happened since then is that most cable and satellite companies now offer some sort of combination DVR / set top box. I haven’t checked with all the cable companies, but my satellite provider doesn’t charge any more for a DVR set top box than it does for any other set top box. So you are only paying for the benefit of piping all your TV channels into another room, not for the DVR functionality.
Although Tivo has been trying hard to set up agreements with cable and satellite providers (they have one with Direct TV), it appears that those guys are smart enough to understand that they don’t really need Tivo and that many of their customers may resist the added fees. Consequently it came as no big surprise when Direct TV announced that they will start selling their own non-Tivo DVRs (like Dish Network does). Given Tivo’s continuing financial problems, one wonders what the outlook is for all those people who paid a lump sum for a lifetime subscription? Being in the technology business, I always chuckle when I see the word “lifetime” associated with any sort of tech product.
But at the same time I feel strangely bad for the Tivo company. They picked a memorable name that rapidly became synonymous with digital video recording, did an excellent job on their software, and introduced an incredible product that is changing the way people watch TV. If the company eventually goes under, it will make a good case study for Business Strategy 101.
You see, the Tivo business model was built around a data connection between your machine and their servers. Not only did they use that to collect information on what people were watching, with a long range plan to sell that information to the networks, they needed that connection to update your onscreen program guide. Tivo made the strategic decision that they were going to provide it over a phone connection and charge $12.95 per month, (or you could choose a one-lump-sum “lifetime” subscription fee of only $300!). The subscription approach looks good on a business plan with a huge projected subscriber base, but how about all those people out there who already have that link set up through their cable or satellite subscriptions? Will they be willing to pay an extra $13 per month for the same programming information they already get? Tivo bet the farm that they would.
That $13 extra per month is precisely why I decided to get my first DVR two years ago through Dish Network, rather than commit myself to Tivo. I paid $189 for my Dish DVR (after rebate) and the normal $5 per month fee for the extra receiver (I think all cable and satellite plans charge you some small monthly fee for additional set top boxes).
What has happened since then is that most cable and satellite companies now offer some sort of combination DVR / set top box. I haven’t checked with all the cable companies, but my satellite provider doesn’t charge any more for a DVR set top box than it does for any other set top box. So you are only paying for the benefit of piping all your TV channels into another room, not for the DVR functionality.
Although Tivo has been trying hard to set up agreements with cable and satellite providers (they have one with Direct TV), it appears that those guys are smart enough to understand that they don’t really need Tivo and that many of their customers may resist the added fees. Consequently it came as no big surprise when Direct TV announced that they will start selling their own non-Tivo DVRs (like Dish Network does). Given Tivo’s continuing financial problems, one wonders what the outlook is for all those people who paid a lump sum for a lifetime subscription? Being in the technology business, I always chuckle when I see the word “lifetime” associated with any sort of tech product.
But at the same time I feel strangely bad for the Tivo company. They picked a memorable name that rapidly became synonymous with digital video recording, did an excellent job on their software, and introduced an incredible product that is changing the way people watch TV. If the company eventually goes under, it will make a good case study for Business Strategy 101.
Wednesday, February 9
High Speed Internet - How Much is it Worth?
I’ve commented a couple of times on the emergence of free WiFi in various places, but it seems to be growing faster than I expected. The number of places offering free wireless internet connections is apparently growing exponentially. There are even whole commercial zones set up as hot spots, to encourage people to shop and dine there. I live near Long Beach California where in their downtown area you can sit at an outdoor cafe on Pine Avenue and check you e-mail or surf the net for free, compliments of the city and a consortium of businesses. Before long free WiFi will be a normal accepted cost of doing business. It will be a component of good service.
During each new phase of technological progress, the expectations of consumers ratchet up a notch. Remember when the fax machine was the necessary new thing to be in business? Then it was computers; now if a business doesn’t have a website, people are likely to get suspicious, thinking that they may not be legitimate or that they are in trouble financially. Personally I get annoyed if a business doesn’t provide at least the basic information online about their hours, directions to the place and other details about their business. My reaction is that they aren’t very serious about providing good service.
To me this proliferation of free internet service is an encouraging sign for all of us – even those who don’t use the free WiFi at this point. Why? Because it puts pressure on the big internet services to lower their prices for DSL and Cable. No matter who you are, $40 - $50 is a lot of money to spend on high speed internet service for home use - especially if you are already spending a fair amount on regular phone service, cellphone service, cable or satellite TV, etc.
Given the availability of free internet service, I can see a whole lot of people who own laptops opting for the occasional trip to the coffee shop down the street, to log on for free and check e-mail. Eventually, they may be able to get it right from their apartment if they live in an urban neighborhood where there are several businesses transmitting nearby.
It’s interesting how markets overlap, and create competition where you might not expect. Just as traditional toy makers compete for consumer dollars with the manufacturers of non-toy products, so do the sellers of home internet service now compete with commercial establishments that are giving it away for free. Internet service is rapidly becoming a commodity as the “information highway” extends to every aspect of our lives.
During each new phase of technological progress, the expectations of consumers ratchet up a notch. Remember when the fax machine was the necessary new thing to be in business? Then it was computers; now if a business doesn’t have a website, people are likely to get suspicious, thinking that they may not be legitimate or that they are in trouble financially. Personally I get annoyed if a business doesn’t provide at least the basic information online about their hours, directions to the place and other details about their business. My reaction is that they aren’t very serious about providing good service.
To me this proliferation of free internet service is an encouraging sign for all of us – even those who don’t use the free WiFi at this point. Why? Because it puts pressure on the big internet services to lower their prices for DSL and Cable. No matter who you are, $40 - $50 is a lot of money to spend on high speed internet service for home use - especially if you are already spending a fair amount on regular phone service, cellphone service, cable or satellite TV, etc.
Given the availability of free internet service, I can see a whole lot of people who own laptops opting for the occasional trip to the coffee shop down the street, to log on for free and check e-mail. Eventually, they may be able to get it right from their apartment if they live in an urban neighborhood where there are several businesses transmitting nearby.
It’s interesting how markets overlap, and create competition where you might not expect. Just as traditional toy makers compete for consumer dollars with the manufacturers of non-toy products, so do the sellers of home internet service now compete with commercial establishments that are giving it away for free. Internet service is rapidly becoming a commodity as the “information highway” extends to every aspect of our lives.
Wednesday, February 2
Ho Hum
A lot is being made about “video on the go” technologies at the recent CES show in Las Vegas. Several newsletters seem to view this as a big new thing worthy of shouting about. For me, it is nothing more than an interesting technology to watch- one of those long term evolutionary processes that are constantly struggling for traction. Nothing revolutionary about it at all, just the slow natural progression from VCRs to VCD players to DVD players, and now to downloadable movies off the internet.
What makes it boring to me is that the path is strewn with failed formats and standards, products that quickly become obsolete, and a sense that lately it seems to be more about marketing than real consumer demand. Yes, consumer demand is what put a VCR in every house, and demand is responsible for DVD players eclipsing VCRs finally, but the whole thing about watching videos on your cellphone or on the LCD built into your car just seems a little forced and contrived to me.
Do I really need to install a $3000 video system in my SUV so my kids don’t have to suffer through entertainment withdrawal on their 30 minute trip to school? And who is really going to spend money to subscribe to and watch “Lost in Translation” on a 1.2” cellphone screen? To be fair, what will probably happen is that people will subscribe to a mini-video service, one that sends cartoons or little funny short movies over the cellphone, or through the satellite radio system (I’m sure I’m not the only one to think of this). There are a number of producers of these mini movies working round the clock already, hoping that there is a market out there. And of course, you will get mini commercials as well, count on it.
Don’t get me wrong, I’m all in favor of early adopters helping to pull the technology into the next phase, and I understand how marketing people much prefer to tout new features rather than come up with creative campaigns. But I must admit that I am going through a period where the rate of change is getting to me, along with all the people who are soooo certain that X and Y are the next great thing.
Maybe I’m still suffering from some lingering Luddite reaction to all the marketing and sales hyperbole that I experienced at CES. Maybe I should retire to the woods and clear my head for a while so when I come back to civilization I can once again be entranced by all the cool technology that is coming down the pipeline. Time to do some fly fishing.
What makes it boring to me is that the path is strewn with failed formats and standards, products that quickly become obsolete, and a sense that lately it seems to be more about marketing than real consumer demand. Yes, consumer demand is what put a VCR in every house, and demand is responsible for DVD players eclipsing VCRs finally, but the whole thing about watching videos on your cellphone or on the LCD built into your car just seems a little forced and contrived to me.
Do I really need to install a $3000 video system in my SUV so my kids don’t have to suffer through entertainment withdrawal on their 30 minute trip to school? And who is really going to spend money to subscribe to and watch “Lost in Translation” on a 1.2” cellphone screen? To be fair, what will probably happen is that people will subscribe to a mini-video service, one that sends cartoons or little funny short movies over the cellphone, or through the satellite radio system (I’m sure I’m not the only one to think of this). There are a number of producers of these mini movies working round the clock already, hoping that there is a market out there. And of course, you will get mini commercials as well, count on it.
Don’t get me wrong, I’m all in favor of early adopters helping to pull the technology into the next phase, and I understand how marketing people much prefer to tout new features rather than come up with creative campaigns. But I must admit that I am going through a period where the rate of change is getting to me, along with all the people who are soooo certain that X and Y are the next great thing.
Maybe I’m still suffering from some lingering Luddite reaction to all the marketing and sales hyperbole that I experienced at CES. Maybe I should retire to the woods and clear my head for a while so when I come back to civilization I can once again be entranced by all the cool technology that is coming down the pipeline. Time to do some fly fishing.
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