As I understand it, Twitter added “lists” because people wanted a simple way of grouping the people they follow according to some sort of structure that made sense to them.  Tweetdeck had added that capability through “groups” and I had even started using that feature.  I had built groups based on my major categories of interest:  Family. Close (real) friends.  Local people. Educators.  Twitter took that idea, allowed us to create lists through them, and then also offered the option to make the lists “public” and subscribe-able.  People can see your public lists, and if they like them–follow them!

Once Twitter released that option I had actually abandoned the notion of groups and lists.  I wasn’t so sure about what I wanted to use them for anyway.  I have since gone back, adding a private list of just family and friends.

So here is what I am wondering as I peruse the 35 lists that have listed my brother, and the lists that have added me:

Are they all really that different?  And if not, are they a “waste” of time?

In my lists, I see I am listed on a number of Supply Chain Management lists.  And educator lists.  My brother’s lists are understandably predominantly discipline related, and education related.  There are a few others, but those dominate–and that’s the point.  There appears, on a curory look, to be significant overlap on these lists.

The concept of “Wisdom of the Crowds” and “Crowd-sourcing” is that crowds, when gathered together, make better decisions, and are more creative.  Potentially (and grossly oversimplified).   By building lists of people that share common interests we can see the views of others who are thinking about the same things, and get a wide range of perspectives. ²

So here are the “research questions” (or “investigative questions”) that I have:

1.  How many groups have identical or very similar themes? (Like “supply Chain Managers”)

2.  On similar lists, what is the membership overlap?

3.  How much time is spent developing these similar, and perhaps redundant, lists?

4.  Is there a better way to “share” lists, so people aren’t always reinventing the lists (and taking time to do that?)

5.  Is there some psychological need that gets filled by creating one’s own lists, rather than following someone else’s list?  Control? Ownership?

I like the grocery store analogy, but he didn’t  go where I thought he would.

Original Image from http://www.joe-anybody.com/id47.html

I thought he was going to go with the “General Store” analogy where Mr Ike (remember the Waltons?) would be behind the counter. You would go the counter with your mom’s list and he would get everything for you. No real choice in manufacturer of flour, or sugar, or even fabric. You bought what he bought, and brought.

Then we had the advent of the supermarket. You, the consumer, could now peruse from a vast array of similar products, deciding which ones of the myriad choices was right for you. Let’s take my favorite example: tomato paste. You want Heinz? Hunts? Giant store brand? Great Value? You want 4 oz? 8? 16? 32? The killer 64 oz? The assortment just of tomato based products is staggering–yet all choices we have.

Our choices remain limited by that which Walmart, or Giant, or Wegman’s chooses to stock, but (at least in the 2 former cases) they are limited by fiscal and physical constraints, and not some artistic and aesthetic focus.

If you don’t like the choices at one grocery store, you can simply go to another.

Apple is somewhere between these. They aren’t limiting us to only one choice (but oh happy day if we only could be annoyed by one fart app instead of 300!)

Apple however does limit choice. They not only control the store, but they won’t let you go to another store (without forcing you to make ‘unauthorized changes” to your device. Now, I hear the response–”you can go to another store–get a different phone!” But that’s not really the same.

In the analogy of the grocery store I have a device that I use to consume a product (my stomach, and all pertinences attached thereto). I am able to choose between a selection of products that I consume, but the device of consumption stays the same.

In the Apple model, I am forced to forgo a consumption device (one that might have a large number of appealing factors) for the “option” to consume a different assortment of products.

I don’t see why it has to be “either, or.” This Cartesian Anxiety must stop. Tell us that we are “safest” if we shop in the company store. But let us choose (perhaps through an “opt in” feature that won’t cause nightmares with firmware updates) to choose a different store. Let the consumer decide on the risks of consumption, while allowing us to have the same consumption device.

Let us “choose.”

Does Apple not have the “Stomach” for that?

One author, however, worries that if we view the iPad as the path that Apple would rise up and exert censorship over the content, giving us the Jobs view of the world (much as many criticize Disney for giving us Walt’s sanitized view of how the world is.)  I could see  Apple doing that not only to sanitize content, but also to further whatever political agendas they may have given their apparent arbitrary, capricious and vindictive approaches to what is and isn’t approved.  (political in this sense in the larger meaning, not simply political as in government affairs.)

I mentioned this is an email, and in reply, I was told that we shouldn’t worry about that.  That Apple has demonstrated a willingness to not interfere in educational issues as shown through iTunesU and that Apple would probably never get enough market share for that to happen.

Perhaps.  But that led me to ponder further what really would it take to get digital texts  (or as my brother calls them “educational applications” to move from obscurity to ubiquity–and will proprietary get in the way?

First I wanted to address the interesting  notion that  iTunesU is the model of an Open Apple.  That might be true, but the textbook/educational applications that we are seeing discussed are positioned to be sold through the AppStore model, and  the App Store is a model of a closed Apple.  At times, a VERY closed Apple.   Recently we have seeen Apple exerting control not only on content but the tools to be used in developing that content.But let’s set aside for a moment the problems of if Apple were to control the market, and look at what it would take to get there.
Perhaps my correspondent is correct that Apple cannot garner enough market share to make them (and their iPad) a viable contender and competitor in the textbook space, but then we are left wondering:

• If Apple doesn’t control a significant share of the textbook “space” then what are the options for students?
• What incentive will students have to drop $500+ on a device that only a small fraction of faculty will have as the platform for their texts/instructional materials?

Will Apple work towards open standards so that the books/media will be able to be hosted on a wide range of platforms, or will Apple insist on a proprietary standard, working towards exclusivity for the instructional material they “host” on their platform.  This isn’t simply a red herring tossed out to direct attention from some “Greater Good.”  The fact is that right now students are able to choose from a variety of sources to purchase their texts (and thus a wide range of service/price combinations) and even between new and used books.  Faculty can choose between various textbook publishers/providers, which allows the professor to not only choose the best content, but the best value package for the students.

All that can disappear if one source controls the access to the media, and if there exist competing exclusive and proprietary sources for access to media, then students will be required to purchase not one, but several expensive readers/devices depending on the choices of the faculty member.  Or, alternatively the faculty will be hamstrung, “encouraged” by students or administration to only focus on those source-materials available and the dominant device.

So here we go–what is the decision making process that leads a faculty member to assign a “multi-media resource” as the course “text” rather than a regular textbook? What do you when the students are told that for my ONE class the book is no longer that big expense at $100-200 but rather the iPad becomes the big expense–costing 2-5 times that amount. AND there is no guarantee that any other faculty members will commit to a similar path? And of course the publishers don’t want to reduce the price of the “text” below 50% of the current price AND don’t want to make the “book” available permanently. And don’t forget, most technology has a life of 2-3 years when used regularly. Heavy use, along with ever increasing complexity of the applications/software, may well shorten the lifespan of the product that students must purchase, shifting them from a 1 time outlay to 2, or 3 times in the span of a college career–assuming of course that enough faculty adopt these “books” to make it worth their while.

At a time when the pressures from students AND the federal government is to lower the costs of education (and specifically texts) what professor wants to be the one to step up and insist that students get a high priced device that is designed for obsolescence?

So we are faced with an interesting challenge.  At a time when technology is holding out such promise we find at least one company who has the technical ability to break down the cost walls while simultaneously catapulting the technology of learning well beyond anything we have experienced.  And we find that the same company is tighting the grips on their “ecosystem” arguing that they can control their own little corner of the world.

This is one of those pivotal moments–we can see proprietary walls go up, and little gardens of creative learning spread slowly.  Or we can encourage open architectures that will enable creativity and learning to spread quickly, and widely.

Ubiquity? Or Proprietary? Which way do you think things will go?

So now we face  the BIG PROBLEM.

By shifting to a policy where everyone is now to be insured, we open the floodgates of demand (okay, a bit much. But we certainly will allow millions more in.) Demand for services will increase. So it would make sense that prices would increase to balance out the demand (remember Econ 101, all else equal, in the near term an increase in demand will result in an increase in price. In the long term it should result in an increase in supply, as the market responds to the increased demand for the product).

Will we see prices increase? Not for the consumer–they are capped at the Co-pay. And now we are seeing pressures to not raise prices from the supply side (and the insurance companies will be SHOT if they raise rates significantly).

So what happens now? If prices cannot go up, then demand will remain (unrealisticly) high. Unrealistic in that demand is acting free of the market place.

With demand high, and the inability to increase prices we will see no real “benefit” to more providers entering the marketplace.

More to the point, even if we could see more providers enter the market there are significant barriers to entry. Consider the medical field:

1. Doctors must go through extensive training, and then licensing (not to mention the fact that they never really get it right–so must keep “practicing”)

2. medicines must be approved after rigorous testing, and their labs must be approved, and so forth.

3. Various other licensing and authorizing are in place for therapists, assistants, nurses, and the like.

Supply cannot respond quickly, and with a rising demand and supply unable to keep up, and with no pricing mechanism to regulate the demand we will face:

Shortages of service resulting in long waiting lines/delays.

And how do you deal with shortages? Since the market forces are not allowed to work, we are left with the government stepping in, once again, to fix the mess of it’s own making. They will have to “ration” care.

Sorry–it’s a fact. In every nation that has shifted to “socialized” they have faced shortages, lines and rationing.

It’s not something we can “do better.”

It’s economics.

The whole initiative is predicated on a few arguments:

1. Costs (prices) are too high.
2. Insurance companies are “making too much money”
3. Millions of people don’t have access to care
4. The Health Care people are receiving is poor (oh, wait, it’s not about the actual care…)

So let’s tackle this. The basic problem now comes down to a discussion of supply and demand/economics.

As the system currently works we have two sets of perverse incentives fighting against the consumer (and one of these incentives takes place with the willing, yet unknowing, assistance of the patient)

First, the perverse incentives of the patient:

Currently, the “cost of entry” into the health care system is high (monthly “Insurance” rates) but thanks to low, or no, co-pays, the marginal costs of most health care transactions are quite low.

Given the low costs incurred per visit, and the high “sunk” costs incurred to enter the system, the insureds (patients) who HAVE insurance are incented to go to the doctors more frequently, and to go ahead and get the prescriptions (Hey, it’s only $3 copay at Wal*Mart!)

Of course, this is a mirage. The actual costs of each visit and each prescription are borne by the insurance companies, which then have to recover their costs through increased premiums, which of course has everyone screaming that the insurance companies are “gouging” the customers.

On the other hand, we have a set of pricing incentives that also conspire against the consumer. The ‘care providers” are aware that the patient/customer doesn’t see the actual costs–they only pay the co-pay. So given this we have a series of perversions that are at play:

1. Doctors are more able to prescribe tests/medicines, and the like, since they will receive little if any push-back from the patients because of costs. More services with a low marginal cost to the consumer/patient, but a higher total cost, paid by the insurance companies.
2. Insurance companies work to lower their costs by negotiating to pay health care providers a fraction (some value less than 1) of the billable rate. Thus the providers are incented to increase their prices the maintain their revenue stream. This increases the costs once again.

So these two twists to the problem work once again to force the insurance companies to have to raise the rates (really on everyone) to cover the payments they are having to make.

Now–as consumers, we see that we are paying a high “sunk cost” as a monthly fee and, rather than view this as traditional insurance (where I am betting against myself) the consumer wants to try to get at least that benefit back out of the “system” (and is encouraged to do so, by “low co-pays”)

Sadly, the whole mess was brought on by our desire to protect everyone and provide some level planning to health care. The “free market” actually would provide better incentives here, placing limits/governors not only on how much people are willing to spend on services, but the prices that people would have to pay. If service providers want to stay in business then they would be forced to price competitively based on the market, and the market would be making the decisions based on the consumers. As it stands now, with the “same co-pay regardless” the consumer has no indication of value, and the market cannot respond. Viagra is as valued as Interferon and as Motrin.

What to do when everything costs the same?

I am not alone in my expectation that the Health Care (insurance) reform will not improve Health Care (it won’t make bad doctors good ones, for instance) and it won’t improve access since lower prices have that pesky effect of increasing demand–in a field where the barriers to entry for suppliers are significant.

I will say this:  Welcome to the new “Grand Experiment.”  If it succeeds, then by all means celebrate (but could we get a good solid definition of success on which we can all agree?)  But (and this is significant) if it fails, how many will have died as part of the experiment, and will we ever be able to recover?

One final note:  As researchers we have to seek, and get, informed consent from human subjects before we can experiment on them.  Did you get the forms?

I am not writing this as a “hater” or critic of the iPad.  I just would love to see if the demand spiked on the first day and dropped precipitously, or whether the demand over the 21 days prior to shipping stayed relatively constant, or even ramped up as we approached the 3rd of April.

Here’s what I wonder:  people who are early adopters, and the first to get in line and wait for days for a new product, are by all anecdotal evidence I have heard the ones who pre-order, and pre-ordered on the first day they could.  And in the case of my brother, ordered it as soon as the Apple Store made it available.

If my supposition is true, then the demand for pre-ordered items would have been heavily front-loaded.  Conversely,  I would find it quite interesting if demand for the iPad through pre-ordering had any sort of ramping to the demand pattern.  If the demand was increasing, then the big question of the day would be:  Why?

The next question is are the people who would normally stand in line to get the next “really cool product” the same who would want to pre-order right away (and thus reduce or eliminate lines at the stores) or is the psychology of waiting in line for a “cool new product” palpably different from the psychology of “getting” it?

Anyone have any thoughts or insights into this?

I wanted to tackle this for a minute.¹  I would have to agree that the NEXUS is not selling as well as, well, most other smart phones on the market right now, but on the other hand let’s balance the assessment by pointing out a couple things contained in the short post above.

1.  The forecast anticipates selling 1 million units by the end of 2010.   This is actually quite a  significant figure for a phone that really only works best (for now) with T-Mobile.

2.  The Nexus is only “sold directly by Google.”  In fact, let’s be more pointed with this: it’s only sold by Google, through an online purchase.  Imagine if the only way to get an iPhone was through the Apple Store site.  Would they still have sold millions? Yes, undoubtedly, but one cannot discount the tremendous boost Apple received by having their products in the hands of thousands of people nationwide, simultaneously.  Not to mention the tremendous press coverage of the “long lines waiting to get their hands on their first iPhone” that we saw in every news media market.

Now, a million units sold in 1 year is relatively trivial compared to the numbers of even the iPhone 1st generation phone.  That said, consider the deck that Google has elected to stack against itself.

T-Mobile is a good and worthy network, so I am told.  But more often than not, people talk about it as if it is the little sibling of the  ”big 3″ when people talk about their cell-carriers.  I think I can count on one hand (without resorting to binary)  the number of friends and colleagues that use T-Mobile.  Selling a million units for a phone that is, out of the box, tied to a company with http://en.wikipedia.org/wiki/T-Mobile_USA is “not too shabby.”  (This compares right now with AT&T having approximately 85 million wireless customers.)  Given the large numbers of people who are locked in to their existing contracts, I don’t see many people switching carriers, especially since they are not afforded the opportunity to “try before they buy.”  (See next point)

Additionally, the decision by Google to only sell the Nexus online, through their website, has to hamstring their sales.  I may like tech, but when it comes to dropping $500 or more on a phone (and/or getting a long term contract) I want to be able to touch it first, see how it feels and responds in my hands, and feel like I was an informed consumer when  I make  my decision.  I suspect I am not alone.  More than once I have driven past our local T-Mobile store thinking that, if only they had a Nexus in the store, I would stop and at least test the waters.  I suspect that, if I could go in to a T-Mobile and not only play with the phone a bit, but talk with them about the affordability of switching from AT&T to T-Mobile, I would make the switch.  And again, I suspect I am not alone.

Finally, early reports of lack-luster customer support by Google has most likely scared off a number of would-be consumers.  Take away the store front/salesperson access, and market your phone on a network that would require me to switch carriers, and I am going to want, nay expect, a rather significant online and “on phone” support structure.   Unfortunately, Google has grown a culture based around offering “free” and “Beta” services.  Expectations of support for “free” services are far lower than expectations when one spends a significant amount of cash.

And make no mistake–$500 is significant.

In the final (as of today) analysis, I would say that 1 million units sold is actually a remarkable number given that Google has left the confines of their “core competency” (which I will describe as creating free and innovative software-based experiences) and ventured in to the world of offering “for sale” hardware products.²  Additionally, they seem to be wanting to “play by the rules” of traditional retailing instead of breaking new ground in the cellphone industry (as was speculated prior to the offering of the Nexus).

What does the future really hold for the Nexus line?  It is now a waiting game, I suppose.  Imagine Google addressing even 1 of the issues above. An expansion to another network (such as a Verizon or AT&T) or even the opening of sales at T-Mobile stores could make a significant difference for the phone.  Or, perhaps they utimately will rewrite the rules for cell-phones, offering free phones to those that actively use Google services, extending the Ad Revenue model to a whole new domain.

Considering the mis-steps one can only conclude that the Nexus succeeds, despite itself.

But could he have lost his touch? Could Steve Jobs and Apple not only missed it this time, but could they be responsible for bringing down a whole nascent industry with them?

On the heels of the introduction of the Apple iPad (and their announcement that books would cost between $13 and $15) we saw an emboldened Macmillan publishing house pressing their case against Amazon.  For a brief moment Amazon seemed to be fighting the good fight for consumers, and went so far as to ban direct sales of Macmillan books.

Macmillan was simply “acting out” what Steve Jobs told to Walt Mossberg when he said that the prices would end up being the same (between Apple and Amazon), because the publishers are not happy (with Amazon) and are going to pull their books from there.  It appears that Steve Jobs is doing the work of the Publishers, pushing the price points up, rather than down.  Rather than being a champion of the individual, does this make Steve Jobs simply a big business “hack?”

The bottom line here really is that Amazon knew 2 years ago what Steve Jobs should know now. Verso Direct has conducted a book buyers behavioral study/survey, in which they discover that the magic price-point for digital books seems to be right at $9.99.  According to the article “Amazon Flanks…” when Verso presented their study and broke down their findings, they reported that 3 out of 5 people will consider buying an ebook at or below $9.99.  Raise the price, and that drops to 1 out of 5.

The article then goes on to identify the real “winners” as pirates.

Is it possible that, in his rush to kill Amazon, Steve Jobs may have instead spell the death of eBooks?¹