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Editorial - Technical Betrayal Creates Desperadoes

by , 2:30 PM EDT, August 28th, 2007

Modern technology companies are often faced with the prospect of making a lot of money, but at the cost of a technical betrayal of their customers. That's not surprising. What is surprising is that they become oblivious to the consequences as they create a culture of technical desperadoes.

Two articles on Monday caught my attention in this regard. In the first story, "Former FCC Commissioner Condemns iPhone Hacking," a former FCC Commissioner, Harold Furchtgott-Roth, accused hackers of breaching Apple's and AT&T's intellectual property and interfering with these companies' exclusivity contract. The suggestion was made that moral standards of hackers and those who lionize them have declined.

What is the true source of this so-called moral degradation? I believe it is executives who are hell-bent on a fast buck at the cost of technical betrayal of the consumer.

In support, I present the second story from yesterday, "Industry Observer Alarmed by Paramount's Blu-ray Decision," in which Paramount was roundly condemned abandoning their commitment to Blu-ray, striking an agreement with the HD DVD camp that led to great financial benefit, and which led them to "lower the bar for acceptable behavior to customers," according to the editorial referenced.

Entertainment and consumer electronics companies want very much for their customers to be caught up in a fervor for their products and for themselves to become correspondingly wealthy and successful. Unfortunaly, occasions arise when executives face an ethical dilemma. They are faced with a radical change in their course as a reaction to a technological disruption or threat that requires an abrupt, even brutal change in the relationship they have with their customers. In the process of making that decision, they exercise judgment and set an ethical tone for themselves and their company that, in this Internet age, percolates swiftly though the customer base. Often, the decision requires a choice between modest success or great success combined with technical betrayal of the customer.

The entire high technology consumer industry is often noted for its fine print, quickly changing standards, camouflaged absence of key features on products that are shipped prematurely, onerous licensing agreements, and attempts revise customer agreements without notifying the customer.

Customers are exposed to these betrayals on a frequent basis.

The customer's tolerance for technical betrayal is similar to human allergies. Some people have small tolerances, or "buckets," and some have large buckets, depending on their DNA. When the bucket overflows, there's a reaction. For example, some people, allergic to milk products, can have a little cheese for lunch, maybe a glass of milk, but that ice cream for dinner overflows their bucket. Then they have a reaction.

Some executives are tempted to focus only on their own company, their own problems and opportunities. However, out here in consumer-land, people have lots of companies to deal with, and the little bit of betrayal they get from each and every company adds up and overflows their buckets.

By and by, customers feel a certain sense of abuse, and that leads to various kinds of technological push back. Customers have, at their disposal, all kinds of tools, made available both legally and illegally, that allow them to fight back when they feel betrayed. What's becoming clear is that some companies are out of touch with their customers and don't have a feel for how betrayed many feel and the ensuing rationalizations.

The bottom line is that a callous exercise of technological betrayal has an immediate impact on well-connected customers. In contrast, protected by law, attorneys, contracts and fenced in buildings, some executives believe that whatever makes big bucks is just fine.

Like it or not, corporate misbehavior in a technological culture society does set the tone, and suggesting that push back is the result of the customer's decline in moral values, as Mr. Furchtgott-Roth did, just doesn't ring true.

I'm not saying that violating trade secret, U.S. copyright and intellectual property laws is the remedy. What I'm saying is that if companies want their customers to be happy, thrifty, and trustful, then the kinds of unchecked abuse illustrated by Paramount needs to be recognized as part of a cultural problem that creates technology desperadoes.

Observer Comments

Show: Subjects Only | Full Comments
Close Name:jimperuzzo Posts: 11 Joined: 20 Jul 2007
Subject: RIght on the money, Mr. M.

Good easy to digest comment on an issue that will only get bigger. The push back has happened for years, and Napster was only the first large scale example of this. Funny how, pre napster, nobody ever yelled outloud that album owners could take the new album home, and then proceed to copy it over and over again from turntable to tape deck, then from tape deck to tape deck and give it to friends...and none of this was traceable by the big companies, and we never heard about it.
Then along came Napster, and suddenly, since the free exchange of music was traceable by the big corporations for the first time due to this exchange taking place on the trackable internet (excellent use of technology on thier part by corporations, I must say, to protect their ability to make money), all the sudden consumers "lost" the ability to freely exchange music, something they gained in the last decades of the 20th century with tape decks. The irony of the big companies, while being able to shut down Napster, and effectively have a bigger and more controlled market than before, are actually seeing the market "grow smaller" than it was in the pre intenet/digital music age. A quite delicious irony!
My pet peeve is the war by software companies on the "borrowing" of programs... which is feasible, as long as only one person actually registers online for updates, etc. I can see their point about intellectual copyright, etc. But what about mutiple machine single owner set ups? If you own a laptop and a desktop, you are "ethically" required to buy the family pac, and pay 20 more bucks to the company, even though you spent mutiple thousands to have two machines for one person to work on.
I think you get where I am going, and why Mr. Martellaro has perhaps started a great dialogue with this topic. The lashing back by consumers who are in the 10's of thousands getting tired of what he talks about, will eventually bring on more and more Napster-like creations. Will corporate Amerika have enough lawyers, time, money and cohones to fight everyone... one thinks they may, one hopes they can't/won't/don't.
The beauty of this is that the many 10's of thousands will eventually find their own moral balance point, their own high ground to stand upon, if you will, and this will still lead to innovative (if if illegal) soft and hard hacks that will permit "free sharing". And in a neat way, take us back to the end of the 20th century...when we could "share" a bit.
Jim P

Close Name:j.martellaro -   TMO Staff Posts: 80 Joined: 07 Dec 2006
Subject: Betrayals

This isn't quite the technical betrayal I was referring to. But it is a business betrayal of sorts, that is, abusing the honorable relationship between the customer and the company. In the Age of the Internet, everyone gets to
see it, hear it happen.

http://www.youtube.com/watch?v=7JYIXzfhel8

Close Name:John F. Braun -   TMO Staff Posts: 227 Joined: 11 Jun 2001
Subject: Cellphone Betrayal

I've run into this same sort of thing, not with an iPhone, but with a "free" (with 2-year contract) KRZR to replace my old v710. What gets me is that there is so much that the phone CAN do, but is disabled by the cellphone company, NOT the manufacturer. For example, it is next to impossible to load a ringtone on this phone WITHOUT paying Verizon. Sure, if you get the right software, you can mess with the internal file system of the phone, but why?

It looks to me like, at some point, the cellphone industry will have to man up and work like the landline industry; you can't lock your customer into a certain piece of hardware with a certain set of features. It just ain't right!

View Name:Guest
Subject: DVD industry
Close Name:gslusher Posts: 2043 Joined: 13 Nov 2002
Subject:

Quote
jimperuzzo wrote:
Good easy to digest comment on an issue that will only get bigger. The push back has happened for years, and Napster was only the first large scale example of this. Funny how, pre napster, nobody ever yelled outloud that album owners could take the new album home, and then proceed to copy it over and over again from turntable to tape deck, then from tape deck to tape deck and give it to friends...and none of this was traceable by the big companies, and we never heard about it.
Then along came Napster, and suddenly, since the free exchange of music was traceable by the big corporations for the first time due to this exchange taking place on the trackable internet (excellent use of technology on thier part by corporations, I must say, to protect their ability to make money), all the sudden consumers "lost" the ability to freely exchange music, something they gained in the last decades of the 20th century with tape decks.


There is a major essential difference between a few low-quality tapes and millions of digital copies, some quite high-quality. In the same vein, it's not much of an impact to a publisher if someone decides to make a photocopy of the latest Harry Potter book (it might cost as much as the book), but it would be if they made a digital copy available free for downloading.

Close Name:jimperuzzo Posts: 11 Joined: 20 Jul 2007
Subject: I agree

You are right, the digital world is much different in this respect. I was referring more to the individual and their abilty to share.
Perhaps my choice of example was wrong, but then again, what about buying one copy of a book and then sharing it with others? Our purchase of digital products compromises much of this with the protections companies are putting on their wares, protections that did not exist prvious to digital media.

Close Name:gslusher Posts: 2043 Joined: 13 Nov 2002
Subject: Re: I agree

Quote
jimperuzzo wrote:
You are right, the digital world is much different in this respect. I was referring more to the individual and their abilty to share.
Perhaps my choice of example was wrong, but then again, what about buying one copy of a book and then sharing it with others? Our purchase of digital products compromises much of this with the protections companies are putting on their wares, protections that did not exist prvious to digital media.


The fact that a song in your iTunes library is in an electronic/digital format, where there is no physical copy, represented a new problem in copyright law. It's not new--we wrestled with it during my time managing a forum on CompuServe in the mid-'90s, but it has evolved and changed over the years. The DMCA is a major stage in that evolution, which is continuing.

As for protections that did not exist previous to digital media, the digital media didn't exist, either. One "protection" against copying a book, for example (besides enforcing the copyright) was that copying could cost as much as or more than the book and take a long time. Also, copying companies would generally refuse to make more than one copy of parts of a book.

One issue was people copying portions of several books to assemble an anthology. The copyright laws addressed this particular issue decades ago, especially the case of teachers who would copy stories, essays, poems, etc., so that their students wouldn't have to buy a slew of books. The Fair Use provisions were pretty explicit about this situation.

Also, don't refer to sense or analogies, but rather to the law. The law may represent a sensible approach to some, but not to others. When there are conflicting interests, as there are here, someone is bound to be unhappy.

Close Name:esegre Posts: 22 Joined: 28 Feb 2003
Subject: Iphone

RE Iphone hacking.
You mean to tell me that after I buy an Iphone for 500 bucks and don't
register to activate I am not able to do with my phone as I please?
My feeling is that they want you to be captive no matter what even if you
paid full price.
I for one will steer off a gadget that costs 500 and is not usable to its
full extent.

View Name:Guest
Subject:
View Name:Guest
Subject: Anything is permissible in the name of business
Close Name:ctopher Posts: 77 Joined: 25 Aug 2006
Subject: Paramount was paid off

re guest and Blu-Ray fanboys. (Are there enough owners of either format players to have fanboys?)

Paramount didn't make a business decision and choose a format. In fact, they were making both HD and Blu-Ray discs and selling them. So people with either player were happy. In fact according the the linked article:

"Blu-ray has been selling two-to-one over HD DVD this year, and this includes Paramount titles. The last Paramount title shipped on both formats, Disturbia, had a 68:32 split in favor of Blu-ray in the most recent Videoscan survey."

So in fact, the sound business decision would have been to drop HD (How do you like THAT HD fanboys

Instead, "According to the New York Times, HD DVD promoters are paying $150 million to Paramount/Dreamworks to pay for Paramount dropping its support of Blu-ray while retaining support of HD DVD."

So Paramount was PAID to drop the format. Not phase it out, not announce that new titles would only be available in HD. No they DROPPED Blu-Ray, pulled existing stock back from retailers and told their Blu-Ray fanboys (er, customers) too damn bad.

As I said at the beginning, there are probably not enough HD customers, so Paramount felt they could take this money and not cause a revolt. Given that the news made barely a ripple in the main stream press, they appeared to have been right. But just because it doesn't affect the majority of their customers does not make it OK.

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