Category Archives: Bad profits

Dishonourable discharge?

Nokia phone with battery visible

Long overdue, I’m currently reading Bruce Schneier‘s excellent Beyond Fear, and realising that in many ways, security thinking overlaps with architectures of control: the goal of so many systems is to control users’ behaviour or to deny the user the ability to perform certain actions. I’ll post a fuller comparison and analysis in due course, but one example Bruce mentions in passing seemed worth blogging separately:

Nokia spends about a hundred times more money per phone on battery security than on communications security. The security system senses when a consumer uses a third-party battery and switches the phone into maximum power-consumption mode; the point is to ensure that consumers buy only Nokia batteries.

Nokia is prepared to spend a considerable amount of money solving a security problem that it perceives – it loses revenue if customers buy batteries from someone else – even though that solution is detrimental to consumers.

As a battery authentication method, this is more subtle than the systems we’ve looked at before, which actually refuse to allow the device to operate if a non-original-manufacturer battery (or perhaps charger) is used.

Nokia’s system attempts to persuade the customer that the new (cheaper) battery he or she has bought is “no good” by making the phone discharge the battery more quickly – in an extremely underhanded way. From the point of view of the (uninformed) consumer, though, it makes Nokia look good. “Oh, that cheap battery I bought is rubbish, it doesn’t seem to hold its charge. Nokia make them so much better, guess I should stick to them in future.”

But if the Nokia batteries were genuinely ‘better’ than the cheap replacement ones, surely this kind of underhanded tactic wouldn’t be necessary?

P.S. I have no idea whether this Nokia ‘trick’ is real/common/still used, as Beyond Fear has no references, or whether other manufacturers do something similar (as opposed to outright battery authentication-and-denial). I’ll ask a friend at Nokia.

P.P.S. Jason Kottke also noted this tactic back in 2003.

Pier pressure

  Palace Pier, Brighton
Palace Pier, BrightonPalace Pier, Brighton

Deliberately routing users via a longer or more circuitous route is found in many forms (with a variety of intentions) from misleading road signs, to endless click-through screens, splitting up articles, periodic rearrangement of supermarket shelves, and so on. This kind of forcing function can also be used to increase the likelihood of users reading ‘important’ information; as always, there is an agenda behind the design decision.

But it’s rare to see something quite as blatant as the above “This way to the end of the pier” sign on Brighton Palace Pier, attempting to persuade visitors to walk through the amusement arcade rather than along the walkways either side of the arcade. I don’t know how effective it is; conceivably some visitors might assume that it’s the only way to the end of the pier, but given how easy it is to see along the walkways either side, I’m not sure the deception is very convincing.

What’s the worst intentional mis-direction you’ve come across? And did it ‘work’?

Another charging opportunity?

A knife blade cutting the cable of a generic charger/adaptor

Last month, an Apple patent application was published describing a method of “Protecting electronic devices from extended unauthorized use” – effectively a ‘charging rights management’ system.

New Scientist and OhGizmo have stories explaining the system; while the stated intention is to make stolen devices less useful/valuable (by preventing a thief charging them with unauthorised chargers), readers’ comments on both stories are as cynical as one would expect: depending on how the system is implemented, it could also prevent the owner of a device from buying a non-Apple-authorised replacement (or spare) charger, or from borrowing a friend’s charger, and in this sense it could simply be another way of creating a proprietary lock-in, another way to ‘charge’ the customer, as it were.

It also looks as though it would play havoc with clever homebrew charging systems such as Limor Fried‘s Minty Boost (incidentally the subject of a recent airline security débâcle) and similar commercial alternatives such as Mayhem‘s Anycharge, although these are already defeated by a few devices which require special drivers to allow charging.

Reading Apple’s patent application, what is claimed is fairly broad with regard to the criteria for deciding whether or not re-charging should be allowed – in addition to charger-identification-based methods (i.e. the device queries the charger for a unique ID, or the charger provides it, perhaps modulated with the charging waveform) there are methods involving authentication based on a code provided to the original purchaser (when you plug in a charger the device has never ‘seen’ before, it asks you for a security code to prove that you are a legitimate user), remote disabling via connection to a server, or even geographically-based disabling (using GPS: if the device goes outside of a certain area, the charging function will be disabled).

All in all, this seems an odd patent. Apple’s (patent attorneys’) rather hyperbolic statement (Description, 0018) that:

These devices (e.g., portable electronic devices, mechanical toys) are generally valuable and/or may contain valuable data. Unfortunately, theft of more popular electronic devices such as the Apple iPod music-player has become a serious problem. In a few reported cases, owners of the Apple iPod themselves have been seriously injured or even murdered.

…is no doubt true to some extent, but if the desire is really to make a stolen iPod worthless, then I would have expected Apple to lock each device in total to a single user – not even allowing it to be powered up without authentication. Just applying the authentication to the charging method seems rather arbitrary. (It’s also interesting to see the description of “valuable data”: surely in the case that Apple is aware that a device has been stolen, it could provide the legitimate owner of the device with all his or her iTunes music again, since the marginal copying cost is zero. And if the stolen device no longer functions, the RIAA need not panic about ‘unauthorised’ copies existing! But I doubt that’s even entered into any of the thinking around this.)

Whether or not the motives of discouraging theft are honourable or worthwhile, there is the potential for this sort of measure to cause signficant inconvenience and frustration for users (and second-hand buyers, for example – if the device doesn’t come with the original charger or the authentication code) along with incurring extra costs, for little real ‘theft deterrent’ benefit. How long before the ‘security’ system is cracked? A couple of months after the device is released? At that point it will be worth stealing new iPods again.

(Many thanks to Michael O’Donnell of PDD for letting me know about this!)

Previously on the blog: Friend or foe? Battery authentication ICs

UPDATE: Freedom to Tinker has now picked up this story too, with some interesting commentary.

The Terminal Bench

Heathrow: Skyport for the Seventies

Mags L Halliday – author of the Doctor Who novel History 101 – let me know about an ‘interesting’ design tactic being used at Heathrow’s Terminal 5. From the Guardian, by Julia Finch:

Flying from the new Heathrow Terminal 5 and facing a lengthy delay? No worries. Take a seat and enjoy the spectacular views through the glass walls: Windsor castle in one direction; the Wembley Arch, the London Eye and the Gherkin visible on the horizon in the other.

But you had better be quick, because the vast Richard Rogers-designed terminal, due to open at 4am on March 27 next year, has only 700 seats. That’s much less than two jumbo loads, in an airport designed to handle up to 30 million passengers a year.

There will be more chairs available but they will be inside cafes, bars and restaurants. Taking the weight off your feet will cost at least a cup of coffee.

I suppose we should have expected this. If they weren’t actually going to remove the seats, they’d have used uncomfortable benches instead. In itself, it’s maybe not quite as manipulative as the café deliberately creating worry to get customers to vacate their seats that we looked at a few days ago, but as Frankie Roberto commented, “airports seem to be a fairly unique environment, and one that must be full of architectures of control.”

Heathrow: Skyport for the Seventies

Nevertheless, aside from the more obvious control elements of airport architecture – from baggage trolley width restrictors to the blind enforcement of arbitrary regulations, the retailers themselves are keen to make the most of this unique environment and the combination of excitement, stress, tiredness, and above all, confinement, which the passengers are undergoing:

The new terminal may have been heralded as a “cathedral to flight”, but with 23,225 sq metres (250,000 sq ft) of retail space, the equivalent of six typical Asda stores, it is actually going to be a temple to retail. Heathrow may be packed with shops, but when the £4.2bn Terminal 5 opens the airport’s total shopping space will increase by 50% overnight.

After security, two banks of double escalators will transport potential shoppers into a 2,787 sq metre (30,000 sq foot) World Duty Free store… Mark Riches, managing director of WDF, believes his new superstore has the best possible site to part passengers from their cash: “About 70% of passengers will come down those escalators”, he said, “and we will be ready”.

He recognises he has a captive audience: “If we can’t sell to people who can’t leave the building, then there’s something wrong with us”.

Mr Riches, a former Marks & Spencer executive, is planning “to put the glamour back into airport retailing” with plans for gleaming cosmetics counters and a central area reserved for beauty services such as manicures.

“We are moving away from just selling stuff to providing services. This should be real theatre,” he said.

He is also planning what he calls “contentainment” – the music will change according to where you are in the shop and a 14-metre-long “crystal curtain” “bigger than a double decker bus and thinner than a calculator” will show videos, advertising and sports events.

Heathrow: Skyport for the Seventies

Everything about this story – from the location itself out on the bleak badlands between the M25 and A30, to the way the customers are coerced, channelled, mass-entertained and exploited, to the odd hyperbolic glee of Mr Riches’ visions for his mini-empire – seems to scream J G Ballard. If Kingdom Come hadn’t riffed off the Bentall Centre, it could surely have been about a Terminal 5.

Back to the practical aspects: the deliberate removal of public seating to force passengers to patronise restaurants and cafés is in no way isolated to Heathrow. In a coming post – also suggested by Mags – we’ll look at First Great Western’s policy of doing this in some of its railway stations, with none of the glitz of Terminal 5 but all of the cold-eyed distaste for the customer.

Heathrow: Skyport for the Seventies

Images from a leaflet published by the British Airports Authority, 1970.

Bad profits

Image from Sevenblock (Flickr)
Image from Sevenblock (Flickr)
The Gillette Sensor Excel not only comes with a dummy blade, it also only comes with two out of five possible blade slots filled. Images from Sevenblock on Flickr.

The razor-blade model in general is something of an old chestnut as far as architectures of control go, and we’ve covered it in a number of different contexts on this site over the past couple of years. But it’s always interesting to see it in action with razors themselves, especially if the strategy has become even less consumer-friendly. Via the This Is Broken pool on Flickr, in which ‘Sevenblock‘ talks about Gillette’s use of a dummy blade and dummy slots on the Sensor Excel packaging, I learned of Fred Reichheld’s concept of ‘bad profits':

…there is something disappointing with the set-up of buying a new razor. This razor reminded me of Fred Reichheld.

The blade which arrives pre-attached to the razor is fake. Is it dangerous to use a real one? Perhaps.

No, it is a set-up to dupe customers into grabbing a new razor and heading to the mirror only to realize that they are holding a plastic faux blade. Then, turn over the packaging, and two razors are held in a spot for five. Another subtle sigh from the customer.

Why not surprise the customer in the other direction? “Wow, five blades! For less than 20 dollars.” Because that’s what happens when you go to refill. BJs and Costco have good deals on bulk blades.

Reichheld’s idea is, effectively, that a company’s strategies can centre on creating ‘good profits’ or ‘bad profits':

Whenever a customer feels misled, mistreated, ignored, or coerced, then profits from that customer are bad. Bad profits come from unfair or misleading pricing. Bad profits arise when companies save money by delivering a lousy customer experience. Bad profits are about extracting value from customers, not creating value.

If bad profits are earned at the expense of customers, good profits are earned with customers’ enthusiastic cooperation. A company earns good profits when it so delights its customers that they willingly come back for more—and not only that, they tell their friends and colleagues to do business with the company.

What is the question that can tell good profits from bad? Simplicity itself: How likely is it that you would recommend this company to a friend or colleague?

The full article is well worth a read, as, I expect, Reichheld’s book The Ultimate Question is too (though one reviewer on Amazon also offers some succinctly persuasive criticism).

The basic concept, that the ‘ultimate question’ of whether or not a customer would recommend a company is the key to growth is a good way of articulating, from a business perspective, the message of consumer advocacy that so many from Ralph Nader and Vance Packard to Consumerist and Seth Godin have promulgated over the years, though of course the ‘Why?’ and ‘Why not?’ are crucial. But Reichheld’s simple identification of ‘good profit’ and ‘bad profit’ seems to be a very clever way of looking at the issue: the ‘good’ and ‘bad’ labels refer to the effect on the company itself as well as on the customer, since a company reliant on bad profits will, one would assume, ultimately, lose its customer base (unless there are no alternatives – Brand Autopsy has an interesting piece on this in relation to car rental firms).

Most commercially driven architectures of control, then (as opposed to politically driven ones) would seem to be designed to extract value from customers (unwilling or ignorant), and thus might be described as bad profit-seeking, by Reichheld’s definition. To paraphrase Cory Doctorow on DRM, it’s unlikely that any customers wake up and say, “Damn, I wish there was a way to have my actions deliberately constrained for commercial gain by the products and services I use.” Hence, it’s unlikely that customers will evangelise or even recommend products and systems which give them a lousy experience. They may accept them grudgingly, as most of us do with many commercial (and political) interactions every day, but once a ‘good profit’ alternative becomes available and widely known about, they won’t hesitate to switch. I hope.

Maybe ‘good profits’ and ‘bad profits’ are too simplistic as terminologies, much like Jakob Nielsen’s ‘Evil design’ comments, but even a continuum between ‘good’ and ‘bad’ profit intentions is a useful way of thinking about the merits or otherwise of corporate strategies, particularly with customer service, products, pricing, rent-seeking, gouging, lock-in and so on.