I haven’t researched planned obsolescence; are there any good examples of this?
If extra durability/lifespan (beyond the ~15 years that things already last) were possible with a small increase in cost, why wouldn’t manufacturers compete on this axis? I imagine that individual homebuyers don’t care that much, but, say, a landlord of a large apartment complex who was making a major purchase of stoves would probably want to optimize for 15 vs. 20 or 25-year lifespans. They would have someone doing the calculation.
The cartel’s grip on the lightbulb market lasted only into the 1930s. Its far more enduring legacy was to engineer a shorter life span for the incandescent lightbulb. By early 1925, this became codified at 1,000 hours for a pear-shaped household bulb, a marked reduction from the 1,500 to 2,000 hours that had previously been common. Cartel members rationalized this approach as a trade-off: Their lightbulbs were of a higher quality, more efficient, and brighter burning than other bulbs. They also cost a lot more. Indeed, all evidence points to the cartel’s being motivated by profits and increased sales, not by what was best for the consumer. In carefully crafting a lightbulb with a relatively short life span, the cartel thus hatched the industrial strategy now known as planned obsolescence.
I don’t think the reason for planned obsolescence is that it saves expenses designing products this way. Sometimes, they design appliance so that a small part breaks after a specific time (not too long after the warranty expires). This requires special effort.
I think the problem, for the manufacturer, of making durable products is that you’re succeeding your way out of business. If consumer’s needs are met for the decades to come, then there’s no need to make more products. We live in an economy were it’s not products that are made to meet consumer’s needs, but consumer’s needs that are shaped (through marketing) to meet production. That’s the definition of a consumer society I was taught: growth is driven by consumption.
One thing this comment makes me want to highlight is that sometimes shaping consumers “needs” is a good thing.
Sometimes the consumer doesn’t know that this crazy new invention will actually make their life (or maybe just their descendants’ lives) better. After all, horses/no-electricity/no-computers all served me just fine thank you very much!
If extra durability/lifespan (beyond the ~15 years that things already last) were possible with a small increase in cost, why wouldn’t manufacturers compete on this axis?
Because Moloch. If at least one major manufacturer add extra lifespan, that forces the others to compete. But the real profit-maximizing move for major manufacturers as a whole is to conspire into selling short-lived stoves.
As for examples, one of my favorites is this (Samsung printers programmed to stop working after a fixed number of prints). The Wikipedia page linked in my first comment contains other examples.
Because Moloch. If at least one major manufacturer add extra lifespan, that forces the others to compete. But the real profit-maximizing move for major manufacturers as a whole is to conspire into selling short-lived stoves.
Why would Moloch (the metaphorical God for “coordination problems are hard”) be the appropriate metaphor for conspiracy?
Right, “conspire” was the wrong word (as others have noted, information asymmetry is enough, and I don’t think that manufacturers literally gather in smoke-filled rooms to adjust the lifespan of their products). But I still think Moloch to be a valid metaphor for a situation where:
customers are forced to buy short-lived products
manufacturers could unilaterally prolong the lifespan of their products at a small cost (or even a small gain), but they choose not to because they want to sell more now
long-lived products could be sold at higher prices
I’m not even sure that it’s such a competitive move for a company to make. Sure, you might get to sell more at the start, but then everyone has their long-lasting products and there’s no demand, so you too are stuck. It’s a viable option only if you never supply enough to satisfy demand (say, you’re a small business that constantly gets new customers, just not many), otherwise it’s a bad long term strategy.
I don’t think any conspiracy is necessary, just information asymmetry. For example, suppose modern stoves are controlled by microchips, and microchips can be programmed to self destruct after X hours of use. The manufacturer can choose any value of X, and the consumer has no way to determine the value of X. Since every broken stove represents a new potential customer, (and especially when the largest “competitor” is stoves that are already installed and the user is happy with rather than new competing products,) each manufacturer has an incentive to choose the smallest value of X that the consumer will tolerate without resorting to extreme measures (e.g. living without a stove, or politically banning self-destructing chips). The consumer cannot “vote with their wallet” since each manufacturer faces the same incentive and will arrive at a similar value of X. Manufacturers also have an incentive to spread memes which encourage people to accept even smaller values of X, such as this very post.
Even if conspiracies are necessary (though I agree with clone of saturn that they probably aren’t) and even if the conspiracy can’t survive, it can usually survive for some amount of time and during this time many people become a victim. Couple this with the fact that there could be many conspiracies across many different products.
So, if you accept that these conspiracies exist, and my points above are true, it doesn’t seem too crazy to think that the average consumers house is full of products with planned obsolescence.
If extra durability/lifespan (beyond the ~15 years that things already last) were possible with a small increase in cost, why wouldn’t manufacturers compete on this axis?
I’ll offer a slightly different take on this. Namely: there’s no reliable way to communicate this to customers at a decent lag time, so the actual price premium customers are expected to pay for this is too low to be worth it.
Warranty periods only matter given:
1. People are confident that the company will be around for the duration. 2. People are confident that the company will honor them. 3. People don’t mind the time/annoyance of potential warranty calls. 4. Warrantee periods are correlated with actual time-to-failures.
Unfortunately, 1 and 2 are not really possible now. Say you put out a new product with a 25y warranty. And you have a fund put aside to deal with failures. Great! Only… it’s a 25y warranty . That’s a long timespan. How do you protect against the next CEO running things into the ground? Or spinning off that small segment into a separate company with not enough of a fund due to “optimistic” estimates and then having that portion go bankrupt?
And meanwhile someone else will also put out a product with the same 25y warranty, where say 25% of products will fail within 10-15y and they are banking on people not to actually return them, and hence they can sell them cheaper. And so you get outcompeted on price.
I haven’t researched planned obsolescence; are there any good examples of this?
If extra durability/lifespan (beyond the ~15 years that things already last) were possible with a small increase in cost, why wouldn’t manufacturers compete on this axis? I imagine that individual homebuyers don’t care that much, but, say, a landlord of a large apartment complex who was making a major purchase of stoves would probably want to optimize for 15 vs. 20 or 25-year lifespans. They would have someone doing the calculation.
The Phoebus Cartel
I don’t think the reason for planned obsolescence is that it saves expenses designing products this way. Sometimes, they design appliance so that a small part breaks after a specific time (not too long after the warranty expires). This requires special effort.
I think the problem, for the manufacturer, of making durable products is that you’re succeeding your way out of business. If consumer’s needs are met for the decades to come, then there’s no need to make more products. We live in an economy were it’s not products that are made to meet consumer’s needs, but consumer’s needs that are shaped (through marketing) to meet production. That’s the definition of a consumer society I was taught: growth is driven by consumption.
One thing this comment makes me want to highlight is that sometimes shaping consumers “needs” is a good thing.
Sometimes the consumer doesn’t know that this crazy new invention will actually make their life (or maybe just their descendants’ lives) better. After all, horses/no-electricity/no-computers all served me just fine thank you very much!
Ink Cartidges
Apple deliberately lowing down phone processors
The planned obsolescence Wikipedia page has more examples, I suggest reading it. Exploring the what links here page can probably bring more specific examples.
Because Moloch. If at least one major manufacturer add extra lifespan, that forces the others to compete. But the real profit-maximizing move for major manufacturers as a whole is to conspire into selling short-lived stoves.
As for examples, one of my favorites is this (Samsung printers programmed to stop working after a fixed number of prints). The Wikipedia page linked in my first comment contains other examples.
Why would Moloch (the metaphorical God for “coordination problems are hard”) be the appropriate metaphor for conspiracy?
Right, “conspire” was the wrong word (as others have noted, information asymmetry is enough, and I don’t think that manufacturers literally gather in smoke-filled rooms to adjust the lifespan of their products). But I still think Moloch to be a valid metaphor for a situation where:
customers are forced to buy short-lived products
manufacturers could unilaterally prolong the lifespan of their products at a small cost (or even a small gain), but they choose not to because they want to sell more now
long-lived products could be sold at higher prices
I’m not even sure that it’s such a competitive move for a company to make. Sure, you might get to sell more at the start, but then everyone has their long-lasting products and there’s no demand, so you too are stuck. It’s a viable option only if you never supply enough to satisfy demand (say, you’re a small business that constantly gets new customers, just not many), otherwise it’s a bad long term strategy.
How does the conspiracy survive when each individual member has a motivation to defect? (Not saying it can’t, I just don’t understand the dynamics.)
I don’t think any conspiracy is necessary, just information asymmetry. For example, suppose modern stoves are controlled by microchips, and microchips can be programmed to self destruct after X hours of use. The manufacturer can choose any value of X, and the consumer has no way to determine the value of X. Since every broken stove represents a new potential customer, (and especially when the largest “competitor” is stoves that are already installed and the user is happy with rather than new competing products,) each manufacturer has an incentive to choose the smallest value of X that the consumer will tolerate without resorting to extreme measures (e.g. living without a stove, or politically banning self-destructing chips). The consumer cannot “vote with their wallet” since each manufacturer faces the same incentive and will arrive at a similar value of X. Manufacturers also have an incentive to spread memes which encourage people to accept even smaller values of X, such as this very post.
Even if conspiracies are necessary (though I agree with clone of saturn that they probably aren’t) and even if the conspiracy can’t survive, it can usually survive for some amount of time and during this time many people become a victim. Couple this with the fact that there could be many conspiracies across many different products.
So, if you accept that these conspiracies exist, and my points above are true, it doesn’t seem too crazy to think that the average consumers house is full of products with planned obsolescence.
I’ll offer a slightly different take on this. Namely: there’s no reliable way to communicate this to customers at a decent lag time, so the actual price premium customers are expected to pay for this is too low to be worth it.
Warranty periods only matter given:
1. People are confident that the company will be around for the duration.
2. People are confident that the company will honor them.
3. People don’t mind the time/annoyance of potential warranty calls.
4. Warrantee periods are correlated with actual time-to-failures.
Unfortunately, 1 and 2 are not really possible now. Say you put out a new product with a 25y warranty. And you have a fund put aside to deal with failures. Great! Only… it’s a 25y warranty . That’s a long timespan. How do you protect against the next CEO running things into the ground? Or spinning off that small segment into a separate company with not enough of a fund due to “optimistic” estimates and then having that portion go bankrupt?
And meanwhile someone else will also put out a product with the same 25y warranty, where say 25% of products will fail within 10-15y and they are banking on people not to actually return them, and hence they can sell them cheaper. And so you get outcompeted on price.