In today's Finshots, we talk about planned obsolescence and the right to repair.


The Story

It should be easy to repair products you own. But it’s not. In fact, it’s actually getting harder as each day passes by thanks to two key problems that plague the industry.

The first bit is called planned obsolescence where manufacturers deliberately design their products to be short-lived in a bid to force your hand. Think of it this way. If products are deliberately designed with a short shelf life, there is very little your repair work can do. You’ll simply have to throw up your hand and replace the product with a new one. And while you might be inclined to think that no manufacturer would willingly commit to such a program, let us assure you — They do.

In fact, you can trace stories of planned obsolescence all the way back to 1926— when the biggest manufacturers of light bulbs met in Geneva to establish a standard for the useful life expectancy of light bulbs. The plan was to limit the expectancy of light bulbs to ~1000 hours as opposed to ~2000 hours which was the standard back then. The group agreed to abide by this code and vowed to punish any individual manufacturer who refused to toe the line. This eventually led to bulb manufacturers artificially reducing their product’s life and helped them generate a windfall. And while there are different theories on why the cartel pursued this program, the idea of planned obsolescence has captured the collective imagination of consumers and manufacturers alike.

In fact, just a couple years ago, the biggest smartphone manufacturers were fined for deliberately slowing their products. As one article notes —

Apple and Samsung are being fined €10m and €5m respectively in Italy for the “planned obsolescence” of their smartphones. An investigation launched in January by the nation’s competition authority found that certain smartphone software updates had a negative effect on the performance of the devices. Believed to be the first ruling of its kind against smartphone manufacturers, the investigation followed accusations that operating system updates for older phones slowed them down, thereby encouraging the purchase of new phones.

Also, last Wednesday, Apple agreed to pay another $113 million to settle consumer fraud lawsuits in the US concerning a similar issue. So yeah, it's happening and it's happening right now. But wait, there’s more. What if manufacturers resort to planned obsolescence by refusing to offer critical information you’d need to repair your products?

Well, that's another problem.

Over the past few decades, consumer electronics have become harder to fix. And while part of the problem could be attributed to increasing complexity, there is a more sinister plot here. Some companies deliberately make it hard to fix things, either by restricting repair information to authorized dealers or by affixing parts that require specialized equipment exclusively made available to a select few entities. And the worst part here — It’s not just limited to consumer electronics.

Consider, for instance, John Deere, a US farm equipment manufacturer that has a presence in India as well. The company’s agricultural-equipment sales have been on the decline. However, their annual part sales are still on the up contributing $6 billion dollars in 2019. In fact, parts and services are 3–6 times more profitable than the sale of original equipment. So they have every incentive to hold on to their turf and force you to make a trip to one of their authorized dealerships even for the tiniest repairs. As one article in Bloomberg notes —

John Deere has increasingly upgraded its most popular tractors with sophisticated software, which guzzle data and transfer that only to the company and its dealers… John Deere even said in a 2015 filing with the U.S. Copyright Office, that its customers, who pay as much as $80,000 for a piece of farm equipment, don’t own the machine’s software and merely receive “an implied license” to operate the vehicle!


Fortunately, however, consumers and lawmakers are fighting back.

The European Commission recently announced plans to implement new right-to-repair rules that would tackle “premature obsolescence” and the reparability conundrum. In the US, right-to-repair laws have been introduced in 20 states and voters in Massachusetts recently approved a measure that would make it easier for local garages to work on automobiles. Elsewhere, lawmakers are looking to provide more information to customers about products at the point of sale and confer upon them their “right to repair.”

Bottom line — It’s something you’ll probably keep hearing frequently from here on in. So we thought it’s best to talk about it. Anyway, that’s it from us.

But do let us know your thoughts on Twitter.

Until next time…

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