The why of tech
The why of tech
SAVVY marketing executives have figured out how to circumvent sticker shock and still get money out of consumers, particularly young consumers. Why buy once when
you can rent forever?They realize it's not the one-time sale that makes the corporate ink run black, it's monthly service fees. Why stick 'em for $200 or even $2,000 when you can silently relieve them of $20 or $30 each and every month?
In a world that is ever more connected, hardware is becoming increasingly worthless. What good is a Walkman that requires one to tote around music cartridges? Who wants a video game that can't be linked to another? More and more, that answer is "Not me." Services are coming to the rescue, and the companies that offer them will give you the latest and greatest device for free, if you'll just sign a two-year contract.
I have a friend who recently tried to replace his dying cell phone. His original mobile phone contract had long since expired, so he called the 800 number and signed up for a plan with better rates. That out of the way, he went to the store to buy a new phone.
When he got there, he found out they wouldn't sell him one. Why? The phones weren't for sale; they were merely enticements to get people to sign monthly contracts for an average of about $500 a year. Since he had already signed up with someone, the salespeople there wouldn't give him the time of day, let alone a new phone.
It's not different for software companies. Microsoft, for example, has an initiative to sell services over the Internet called ".net."
With .net, Microsoft hopes to sell you access to its products, rather than selling them to you outright. Like the cell phone companies, Microsoft realizes the real money is not in selling something, it's in renting it. Remember when Internet access providers gave away free computers to anyone that signed a multi-year contract? Same thing.
The printing press marked one of Man's greatest achievements by giving us the ability to record knowledge. The computer gave us the ability to process knowledge. Now, with the network, we have the ability to share that knowledge. It's just going to cost you $29.95 a month.
Steve Jefferson is a Honolulu-based freelance writer
and section editor for InfoWorld. He can be
reached at: stevej@lava.net