Category Archives: Technology

CompuServe Memories

On June 30th, America Online finally shut down the original CompuServe Information Service, which they had purchased in 1997.  While I haven’t really used the service for several years, this is still bittersweet news to me due to strong personal connections.  CompuServe was my first exposure to the concept of online computing back in the 1980s and my first professional job in the early 1990s.

My first computer experience was with a Radio Shack TRS-80 Model III that my father purchased in 1980 (when I was 10 years old).  Around that same time, Radio Shack made a deal with CompuServe to package and promote their service.  Under branding that Radio Shack called “Videotex”, they packaged CompuServe either with a dumb terminal or with terminal software sold for the TRS-80s.  My father bought a 300-baud modem and the Videotex package for the Model III, giving us our first look at connected computing.

My exposure to the features of CompuServe during this time was really just a taste as the service came with a pretty high hourly fee for use.  I mainly recall spending a little time watching over my father’s shoulder as he used it to access various news, weather, and information like that, although I recall that he generally preferred a competing service called The Source, which CompuServe eventually bought out and absorbed.  I also recall having a couple rare opportunities to spend an hour playing some of CompuServe’s primitive early online games.

Due to the hourly fees, I never spent any time in discussion boards or chat, instead getting early exposure to these via privately-run Bulletin Board Systems (BBSs) and, a few years later, with General Electric’s GEnie service, which was one of the first to offer discussion boards and a few other services at a fixed monthly fee instead of charging by the hour.  CompuServe was actually one of the last services to drop the hourly charges, which probably played a big role in their eventual decline.

After I graduated from college in 1991 with a degree in Computer Science and Engineering, CompuServe was one of the many technology companies to which I applied.  I ended up accepting a job with them as a junior engineer in their Entertainment Technology group, which focused on game products and the CB Simulator, which was their name for online chat.  I worked there for around 4 1/2 years, before I decided to move to California to pursue other opportunities in mid-1996.

The CompuServe headquarters was a campus in an industrial park located in the Columbus, Ohio suburb of Upper Arlington.  It consisted of two major buildings, the larger one (where I worked) housing the corporate business offices and the operations managing the consumer service.  The other building mainly housed their very lucrative network services division.  There was a nice employee cafeteria (The Oak Room), which was run by Marriot and an employee fitness center.
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The Oak Room had pretty decent food and I generally ate there a couple times a week.  They had a selection of standard grill items (burgers, chicken strips, etc.) that were available every day as well as a featured entree.  They would occasionally do prepared to order stir-fry or pasta that were immensely popular and would result in long lines during lunch hour.  I’d typically eat there on days that the entree sounded particularly good or when my schedule made it tough to leave the office for lunch.  When I did leave, there was a Wendy’s, a Pizza Hut, and a sandwich place across the street as well as numerous other restaurants that were a fairly easy drive.  The Oak Room also served as a location for larger meetings and employee gatherings.  I even remember just about everyone in the building gathering in there to watch the OJ Simpson verdict on a big-screen TV.

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Why I Don’t Have a Palm Pre Yet

June 6th was the launch date for the Palm Pre, the heavily hyped new smartphone from Palm and Sprint.  What I really want in a phone is something that matches the elegance and simplicity of the user interface on Apple’s iPhone, but still includes a physical keyboard and multitasking capabilities.  The Pre appears to be a very close fit, almost certainly much better than the Windows-mobile based HTC Touch Pro that I bought last year.

I definitely tend to be an early-adopter on new gadgets, so it certainly wouldn’t have been surprising if I had run out to buy a Pre last weekend.  In fact, I would have very much liked to have made that purchase.  Unfortunately, I’m already a Sprint customer and, as I mentioned earlier, I purchased a new phone last year.  Because of this, I am not currently eligible for upgrade pricing, which means that any phone purchased now would cost me considerably higher than the new or upgrade eligible customer pricing, which, of course, is the pricing that Sprint and Palm are advertising publicly.

I am, of course, under a 2-year contract with Sprint that was a necessary condition for the purchase of my last phone.  I completely recognize the validity and legality of that contract and that it is the underlying reason why I am not eligible for upgrading without a price penalty.  My purpose in this post is not to argue that my situation is somehow unfair or that I am being denied an entitlement.  I never had any expectation of being able to upgrade early and I don’t believe that there is anything unethical, much less illegal, about the system.

What I do question pretty strongly is whether or not the current business model used by the cell phone industry is a correct one in today’s marketplace.  Particularly since Apple has turned the smartphone into a much more mainstream product with the iPhone, the industry has entered a phase of extremely rapid growth and enhanced competition with frequent introduction of new models with desirable new features.  I strongly question whether customers are going to continue to be willing to accept a system that requires a 2 year wait between upgrades.

I had initially started thinking about this as subject for a blog post after getting into a Twitter discussion of it during the day of the Pre launch.  I got busy with other things and didn’t find time to start working on it until later.  In the meantime, this became a very hot subject generating a lot of coverage both in blogs and the mainstream press after Apple announced the third-generation version of the iPhone and AT&T revealed that the lower pricing would not be available to current iPhone owners that are still under contract.  This is a change from the approach taken with the last version of the iPhone, which was offered at the new-customer price to owners of the previous version, regardless of contract status.

The central idea behind current business model used by the cell phone industry is that the carriers subsidize a portion of the purchase price for the phone in exchange for the customer committing to a service contract, generally for 2 years.  If the customer chooses to switch carriers before the contract is up, he/she is obligated to pay a fairly substantial fee to buy out the contract.  Most carriers offer the customer the option of a smaller discount on an a new phone half way through the contract.  After the contract expires, the customer is generally eligible to again get the same subsidy offered to a new subscriber.

The contract system eliminates a lot of the need for carriers to expend much effort in customer retention, outside of the discounted phones offered at the end of the contract.  This likely saves the companies a lot of money, but is also almost certainly the biggest contributor to the industry’s reputation for poor customer service.  I have found that no matter which of the big cell phone carriers is mentioned, it doesn’t take long for someone to start telling stories about their horrible experiences.

It is in the best interest of the cellular carriers for most phones to have non-subsidized prices that are prohibitively high for most people since, otherwise, it is a safe bet that most people would forgo the contract.  This would make it much easier for customers to switch carriers at will and, thus, would greatly increase the cost and effort that the companies would have to expend towards retention.  I have little doubt that this would dramatically improve the quality of the customer experience, but it might or might not have a negative impact on profitability.

The big question is whether or not the non-subsidized prices really reflect the true cost of a cell phone or if they are kept artificially inflated by the cell phone manufacturers as a result of the subsidy-based sales model.  I admit that I have no direct knowledge, but my educated speculation is that the subsidized prices are probably more realistic.  The non-subsidized prices for phones (especially smartphones) simply seem way out of proportion with the pricing for other portable electronics.  In most cases, those prices are pretty close to what you would pay for a full-featured laptop computer and considerably higher than netbooks, stand-alone PDAs, or portable media players, any of which would seem more comparable technology.

The most obvious direct comparison would really be between the iPhone and the iPod Touch, which is basically an iPhone without the cellular radio or camera.  The pricing information for the 16GB version of the new iPhone 3GS has indicated that it costs $199 fully-subsidized (the price widely advertised), $399 for customers 1-year into their 2-year contract, or $599 un-subsidized.  The suggested retail price of the 16GB iPod Touch is $299 and it can be found in the $260-$275 range if you shop around.  I can certainly see where the added features of the iPhone would justify a higher price, but does it really make sense that they would double it?

In all fairness, my instinct looking at those numbers is that the $399 price offered after 1-year is probably the most realistic one.  While I suspect the price on the iPod Touch is also a bit inflated (it doesn’t really have direct competitors), it really does look like the $199 price probably brings in a pretty thin profit margin, if there is any at all.  The same is probably true with the similarly priced Palm Pre, although it does also have somewhat lighter specs, including only 8GB of memory. Even if the subsidies do push the prices down below the actual cost of the phone, I can still see justification for why the carriers might want to subsidize even for existing customers still under contract in order to prolong their contract and help to ensure loyalty.

I think that they might want to look to the satellite TV business as a possible example.  I’ve been a DirecTV customer for a number of years and they also use a system of contracts and subsidized equipment.  The big difference from the cellular business, though, is that DirecTV lets current customers upgrade their equipment (such as going to a DVR or hi-definition) at the fully subsidized price no matter how far they are into a contract.  The one catch is that doing so will reset their contractual start date to the date of the upgrade.  This helps to accommodate any need that the customer might have to move up to something better or different, while also pushing further back the date at which he/she might be able to switch to a competitor.

I do imagine that the cellular industry would probably prefer to stick with the current fairly customer-unfriendly system for as long as possible, but I do seem some recent signs that they may very well be changing their approach.  The recent publicity over AT&T’s prices for iPhone upgrades hasn’t been very good for them, even if they are pretty clearly within their rights.  A fan base as loyal as the more vocal iPhone owners, particularly when they are so willing to spend more money to make sure they have the latest and greatest, really does need to be cultivated and protected.  Policies that seem to directly target those loyal customers may not be in the company’s best interest, even if they appear to be the most financially prudent on the surface.

Another interesting development is Sprint’s recent introduction of the Sprint Premier loyalty program.  Customers that have achieved high longevity (10 years or more) or have one of the higher-end service plans (priced over $69.99/month, a fairly common price point for a smartphone with both a voice and data plan) are automatically enrolled in that program.  While the program offers a number of smaller benefits, the big one is that those customers are eligible for the fully-subsidized upgrade price at the end of the first year of a 2-year contract.  While Sprint’s recent issues with customer retention probably made this more necessary for them, it still is a pretty clear acknowledgement that higher-end customers are increasingly unwilling to wait 2 years between upgrades.

New Technology Blog

Technology (particularly computers) have been a big part of my life for many years.  I first became interested in computers at age 10 when my father purchased a Radio Shack TRS-80.  I eventually went into Computer Engineering as my career and have been something of a gadget collector all of my adult life.

For the most part, I have generally avoided writing posts that were too focused on technology for this blog.  I have a pretty good idea who my main readers are (most are friends or family) and I have a hunch that the interest level wouldn’t be overly high on most technology-related topics.  At the same time, it certainly is an interest and I often come across bits of technology news or various tech-related tips or experiences that I’d like to relate.  For this reason, I have maintained a second blog for quite a while for more technical posts.

When I first started that blog, it was very narrowly focused on Ultra-Mobile PCs (UMPCs).  I bought one of the earliest models released in that category and thought I’d have a lot to say as a bit of a pioneer in that area.  Eventually, I kind of started to run dry on things to post on that topic and expanded the subject to include all kinds of mobile technology.  Even that was a pretty limiting topic, though, and I eventually kind of abandoned that site as well.

I have now converted the blog into the generalized Bigbeaks Technology Blog.  My plan is to make it more of a traditional weblog with shorter, more frequent posts, frequently highlighting interesting news items or articles that I encounter.  I will also periodically post my personal discoveries or tips regarding technology and I’m sure I will also sometimes write reviews or longer essays as subjects come along that strike my interest.

Occasionally, I’m sure that there will be topics that are technology related (or at least tangentially so), but which still seem to be general interest enough for this blog as well.  In those cases, I probably will post on whichever blog seems to be the best fit and then put up a post on the other one linking back.  I suppose there may be rare occasions where I could choose to just cross-post to both as well.

New UMPC Blog

I have purchased a new Ultra-mobile PC (UMPC) and as an early adopter, I expect to have a lot to say about it. Because of this, I have created the new Bigbeaks Ultra-Mobile PC Blog.

This original blog will continue to be my place to post whatever comes to mind about any other topic, but I encourage those of you with interest in UMPCs to check out that new site. I have copied the two previously posted articles about UMPCs there, plus there is a new article with my first impressions of my TabletKiosk eo v7110 UMPC.

Palm’s Future Mobile Managers and the UMPC

Palm’s Future Mobile Managers and the UMPC
By Jeffrey Graebner

Since the recent announcement of Microsoft’s new standards and software for what they call an Ultra-mobile PC (UMPC), which I discussed in an earlier post, there has been a fair amount of speculation in the online Palm OS user community about what this means for the future of the Mobile Manager line. I touched on this topic a bit in my previous essay, but I thought the subject deserved a more lengthy discussion.

A recent editorial by Ed Hardy at 1src.com focused quite a bit on steps that Palm could take to make the Mobile Manager line more of a direct alternative to a UMPC. I think he is largely coming at this from the wrong angle. Instead of focusing on how to compete with the UMPC as a PDA, I think that Palm needs to understand that Microsoft’s announcement essentially validates the whole concept that Palm introduced with the Mobile Managers. Instead of trying to present the LifeDrive and its successors as alternatives to the UMPC, Palm should work to help the public understand that they are versions of the same idea. If Palm intends to continue with the Mobile Manager line, within a year or so I would expect them to be able to do essentially anything that a UMPC can do.

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