Commentary

Lifecycle Of Consumer Digital Products

The amazing number of digital consumer devices in the marketplace today is breathtaking, especially when one considers a fundamental shift toward a new and still emerging product lifecycle. It is literally a feast or famine journey for electronics manufacturers. The new lifecycle is keyed toward rapid product development, even more rapid product announcement, followed closely by product availability... and then, an all too rapid journey toward product obsolescence? It's like being an avid runner out shopping for running shoes. As soon as you find something you really like and run in a lot, another trip to the shoe store finds that that model is now discontinued -- rapid product obsolescence. Same for consumer electronics?!

Not so long ago, a new electronics product would be announced and then be available perhaps six months to a year later at retail. No more. The new digital product lifecycle has a certain immediacy and disposability of design about it. Can you recall a time when a broken VCR would lead to a trip to the repair shop? That always turned out to be a mistake! Can you even find repair shops for TV's, VCRs, and other devices any longer? Everything today is oriented toward newness, personalization, disposability and replacement.

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Have a DVR? The meantime to failure rate is in the neighborhood of five years. When the drive fails, perhaps you can replace the drive, but more likely you will simply dump the unit and start out new. Yes, DVR manufacturers do chart the survivability of their units as it relates to hard drive life, and they know exactly what to expect. But the "replacement hard drive" businesses just don't seem to be emerging of late. Even the popular iPods will fail, though likely because the battery has succumbed to the "charge/re-charge" death spiral... before the drive itself fails.

Even buying the intoxicatingly beautiful new HDTV set will take one to the new heights of tough decisions: buying an expensive warranty that the retailer claims will "protect your investment." Are you kidding me? A $3000-$4000 HDTV set will fail rapidly? No, not really. The sets actually don't fail all that often. Obsolescence in HDTV is likely to become more a matter of consumers wanting newer and better features. Yes, the HDTV downward price spiral is consumer favorable and buying an HDTV replacement set (not for failure) but for feature improvement, is becoming real. So yesterday's purchase of an HDTV was probably unwise given the premium price I paid, but worse when considering that the warranty cost me $700. Yes, the warranty pays for a bulb replacement - and, yes the bulb is a $300 item alone. Salesperson said it was a "no-brainer" -- but the trouble is, the bulb will be a $50 item in two years. A main part of the HDTV margin is in the warranty sale, just like refrigerators, washers, etc. Like a dope, I valued the warranty too highly -- but it is a part of the new digital lifecycle (and to be sure, for some, the warranty probably makes sense).

The bottom line is this: every new consumer electronics device has a failure/obsolescence point. The educated consumer must consider that at the point of purchase and understand the variables. DVR and computer hard drives take a beating from repeated use. Batteries just don't last. Cell phones are especially disposable for feature creep and wear and tear reasons. The consumer electronics product lifecycle is intended to bring you back to the store either because: 1) the device has failed, 2) because the device just isn't good enough anymore, or 3) because you are determined to acquire the newest gadget going. Advertising propels this message along -- and frankly, all is fair in business and in love. But if you love your electronics, bring your electronic wallet along!

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