Planned Obsolescence
Sunday, February 24, 2013 at 3:00AM
[Positive Dennis] in Economics, Leaving Babylon

One of the aspects of Babylon is the planned obsolescence of its products. While this statement may be quite exaggerated, since this really hurts the brand's name and reputation, it does exist. Here is how Wikipedia describes it:

Planned obsolescence or built-in obsolescence in industrial design is a policy of planning or designing a product with a limited useful life, so it will become obsolete, that is, unfashionable or no longer functional after a certain period of time. Planned obsolescence has potential benefits for a producer because to obtain continuing use of the product the consumer is under pressure to purchase again, whether from the same manufacturer (a replacement part or a newer model), or from a competitor which might also rely on planned obsolescence.

Our old toasterWe recently remodeled my mom's home and moved in. It has an interesting history as it was built by a Hyatt, of the hotel chain. It had a helipad on the roof. The rumor is that JFK and Marilyn Monroe had a tryst there. We have already noticed that some of the products we have bought for the home have started to fail. Naturally, just a little past the one year warranty. So far the first to go is the toaster. Not a high ticket item, but it was annoying. 

We did not buy the same model, even though it was still available. We bought a competitor’s toaster. This is why I doubt that the obsolescence is planned—as I mentioned, it hurts the brand.

What is happening instead is price competition. If your product sells for $60, and the competitor’s for $50, and there is no perceivable difference, which will you buy? The engineers know this and they must reduce production costs to be able to sell their product at their competitor’s price. This leads to a higher failure rate. I do not think that evil engineers sit around trying to make an inferior product. They sit around trying to reduce production costs, which from the consumer perspective is identical. It is the system that does this. 

Apple avoids this by making top products that last a long time. They get a premium, deservedly so in my opinion. I am still using my 6 year old computer and it works fine.

However Apple does use a form of obsolescence—stylistic. This is planned and is much more subtle, I would even say insidious. Can you tell I am in the market for a new computer? I will blog about how Apple does it tomorrow. 

Apple is a poster boy for how most obsolescence works in our modern world. 

Article originally appeared on Prophecy Podcast (http://www.prophecypodcast.com/).
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