Obsolete Or Defunct: The Disappearance Of Everyday Things & Businesses

Blockbuster's Last In-Store Rental Was 'This Is The End' (Of Course)

(By The Huffington Post, 11 November 2013)

Say what you will about Blockbuster, the company knew how to take a DVD, apply various corporate labelings to it and place it on a shelf.  So when the dying cultural titan (or evil corporate behemoth, depending on your personal experience) closed its in-house U.S. rental business this past Saturday, what was the final purchase? Perhaps it was some fabled flick, like Spartacus or The Godfather or something? Nope, it was that Seth Rogen flick you didn’t see- “This Is The End”.

 

Blockbuster Goes Bust

(By Serri Graslie, NPR, 08 November  2013)

Blockbuster was once the king of movie rental stores. At its peak, it had about 60,000 employees and more than 9,000 stores.  But after struggling for several years, the chain is breathing its last gasp. Dish Network, which bought Blockbuster in a 2011 bankruptcy auction, says it will close the remaining 300 or so company-owned stores by January.  On Twitter, it put out a call for "Blockbuster Memories."

But don't be surprised if you stumble across an open Blockbuster in Alaska or Texas. In those states, 26 stores are owned by the Austin, Texas-based Border Entertainment. They're among roughly 50 franchises or licensees that will live on after the parent company shuts down, becoming what are often called "zombie" stores.  Border Entertainment's president, Alan Payne, tells All Things Considered host Melissa Block that while business isn't what it was a few years ago, his stores are still profitable.  "We've managed to make it work," he says. "We've just been totally focused on what the stores could do that our competition could not do."  That means maintaining a large selection, keeping prices low and knowing your customers. In Payne's stores, an older movie that you wouldn't find in a Redbox kiosk costs only 49 cents a day, or 99 cents a week. 

Although Dish Network blamed the downfall of video stores on the rise of digital distribution, Payne says not all consumers have gone online.  "If you're sitting at home right now and you don't want to buy a movie, you want to rent one, the only place you can really do that is online," he says. "A lot of people don't know how to do that. And the ones that do, it would cost them $3 or $4."  And especially for customers in his Alaska stores, expensive Internet access might keep them from streaming movies online in the first place.

Payne says the final closures shouldn't make that big of a mark on his business. The stores will license Blockbuster's trademark, print their own materials and change out their computer system.  Getting movies won't be any harder, he says, because Border Entertainment buys them from a wholesale distributor. And sometimes, the company just sends a store manager out to buy multiple copies.  "It sounds crazy, but most mass merchants that sell movies sell them at cost," he says. "So we can go to Wal-Mart, for example, and we'll pay about the same price to them that we would pay to a wholesale distributor."

Payne estimates his niche business will still be good for at least another two or three years. The company currently has about 40,000 people coming through its stores every week.  "I don't have my head in the sand. I know that we're challenged by all the technology," he says. "But I haven't given up on the opportunity that it might flatten out at some point. So that's what we work toward — but we have to be realistic and realize that it is declining."  Ultimately, Payne says it's not just a good selection and low prices that have kept customers coming back to his Blockbusters as the chain dissolved around them.  "Part of why people come, obviously, is for the community experience of seeing friends and seeing our employees in the stores that obviously know movies," he says. "That's part of why we're still here, because a lot of people like that experience."

http://www.npr.org/blogs/thetwo-way/2013/11/08/243967587/blockbuster-fades-out-but-some-zombie-stores-will-live-on

 

MELISSA BLOCK, HOST:

The Blockbuster movie rental chain is breathing its last gasp. A few years ago the company closed thousands of stores, went into bankruptcy, then was bought by Dish Network. And now Dish says 300 remaining Blockbuster stores will be closed by early January. While the parent company is shutting down its stores, don't be surprised if you see the Blockbuster name if you happen to be in Alaska or Texas. They're Blockbuster franchises owned by Border Entertainment and those stores will stay open.

The president of Border Entertainment, Alan Payne, joins me from Austin to explain why. Mr. Payne, welcome to the program.

ALAN PAYNE: Hello. Glad to be here.

BLOCK: And along with stores there in Texas, you also have franchises in Alaska from Juneau to Kenai to North Pole. They have the Blockbuster sign I guess and they will stay open. So are brick and mortar movie rental stories still a viable business model for you?

PAYNE: Well, it's obviously viable or we wouldn't still be open. We're still profitable. The business is not what it was three or four years ago. It has declined but we've managed to make it work.

BLOCK: Well, how have you managed to do that because Dish says demand has clearly moved to digital distribution, people streaming movies and renting online. How do you do it?

PAYNE: We've just been totally focused on what the stores could do that our competition could not do. And that involves real low prices, large inventories that are tailored to the markets that we're in. And, you know, if you think about it, if you're sitting at home right now and you don't want to buy a movie, you want to rent one, the only place you can really do that is online. And a lot of people don't know how to do that. And the ones that do, it would cost them $3 or $4. So in our stores that movie rents for 49 cents a day.

BLOCK: Well, how will you keep getting movies if Blockbuster is gone?

PAYNE: Well, they've never supplied us movies and we've always bought movies through wholesale distribution. And in some cases for movies that are coming from studios that don't want to sell wholesale to us, and there are a couple, we actually go to retail stores and buy them.

BLOCK: You just go out and buy them and then rent them.

PAYNE: Yes, yes.

BLOCK: And that works? That's a model that works?

PAYNE: It sounds crazy but most mass merchants that sell movies sell them at cost. So we can go to Walmart, for example, and we'll pay about the same price to them that we would pay through a wholesale distributor.

BLOCK: Well, one thing I've read, Mr. Payne, is that at least in Alaska your business has helped because a bunch of people wouldn't have inexpensive Internet access. They wouldn't have the bandwidth to be able to easily stream movies. So they need to come to you to rent them.

PAYNE: Yeah, you know, one of our competitors obviously is online streaming. And that consumes a lot of bandwidth. So most of the Internet providers in Alaska, as I understand it, they charge more to heavy users.

BLOCK: Well, Mr. Payne, do you look forward and see an endpoint? I mean, do you assume that you can stay viable as a movie rental business indefinitely?

PAYNE: You know, the business is declining but it's slow. And I don't have my head in the sand. I know that we're challenged by all the technology. But I haven't given up on the opportunity that it might flatten out at some point, you know. So that's what we work toward but, you know, we have to be realistic and realize that it is declining.

BLOCK: Mm-hmm. You know, I wonder if managers of these stores are hearing from people who still like the notion that they can come in and maybe ask for advice about a movie or get something recommended by the person behind the counter.

PAYNE: Well, we have about 40,000 people through our stores every week through 26 stores. The stores are busy. Part of why people come obviously is for the community experience of seeing friends and seeing people, you know, our employees in the stores that obviously know movies. So that's part of why we're still here because a lot of people like that experience.

BLOCK: Well, Mr. Payne, thanks for talking to us. Best of luck.

PAYNE: Thank you.

BLOCK: That's Alan Payne, president of Border Entertainment which owns 26 Blockbuster franchises in Alaska and Texas that will stay open even after Blockbuster's parent company shutters hundreds more.

 

http://www.npr.org/templates/transcript/transcript.php?storyId=243967587

 

Your Late Fees Are Waived: Blockbuster Closes

(By Todd Leopold, CNN, November 6, 2013)
 

"Be kind, please rewind," the signs used to say in video stores, urging customers to return their rented VHS tapes spooled back to the beginning.  If only Blockbuster could rewind back to the 1990s.  That was the time when the video chain was the colossus of the movie-rental business, with stores in seemingly every city shopping district and suburban strip mall in America. Visiting the store was a weekly rite for many people, who would show up on Friday evenings to check out the latest releases, navigating a crush of couples and families who had exactly the same idea -- only to find out that the last copy of "Air Force One" or "The Lion King" had already been snagged.

That custom is now as gone as a world with three television networks, a UHF station's late show and a Zenith Space Command.  On Wednesday, DISH Network, which purchased Blockbuster in 2011, announced it was closing the chain's 300 remaining U.S.-based retail stores, as well as its distribution centers.  "Consumer demand is clearly moving to digital distribution of video entertainment," said DISH president and CEO Joseph P. Clayton in the press release about the closures. His statement echoes many from recent years about the migration of entertainment from physical objects -- CDs, DVDs, books, games -- to bits, bytes and pixels available on various screens and portable devices.

Blockbuster will continue its Blockbuster @Home brand to DISH customers, as well as its Blockbuster On Demand streaming service. And an additional 50 Blockbuster stores not owned by DISH will remain open for the time being.  The action was long expected. Blockbuster had been closing stores for years, as is obvious from the yawning vacancies still present in many of those very same strip malls. The chain was done in by Netflix, streaming video and a world of Internet options.

Reaction from that Internet was, of course, swift and pithy. Several posts on Twitter made fun of the store's late fees -- the bane of people who couldn't get their rental back in the standard 48 hours -- and the VHS tapes that made Blockbuster's name.  "I knew this day would come. I'm mere months away from owning a VHS copy of The Mighty Ducks without paying my late fees to Blockbuster," wrote Brian Essbe.  "Yes! All the Blockbuster Video Stores are closing! That means they'll never get back that VHS tape of Vampire In Brooklyn. I won!" added actor and comedian Paul Scheer.  Other commenters just shrugged. Many said they didn't even realize Blockbuster had any stores left.

At its peak in 2004, Blockbuster had more than 9,000 stores.  In a headline, The New York Times put it best: "Internet Kills the Video Store."  But Dan Herbert, author of the forthcoming book "Videoland" and a film professor at the University of Michigan, wants to praise Blockbuster, not bury it.  The stores were clean and family-friendly, with wider aisles and a bigger emphasis on movie selection than the mom-and-pops that dotted the landscape in the 1980s, he said.  "They really standardized video rental in general," Herbert said. 

As with many franchises, at its height Blockbuster often came in for criticism.  The chain put many mom-and-pop stores out of business. Befitting its name, it generally catered to a blockbuster mentality: Hit releases filled shelves by the dozens, but independent and foreign-language films could be hard to come by. The stores wouldn't carry NC-17 films at all.  And then there was the Blockbuster clerk, easily recognized in a blue knit shirt, who was often depicted as either clueless or snotty, depending on how frustrated you were on those crowded Friday nights.  But Herbert, a former video clerk himself -- though not at Blockbuster -- points out that Blockbuster was successful for a reason. It had more variety than many video stores: Blockbuster stores were required to have a minimum of 7,000 movies and averaged 10,000, more than many of its competitors, he said.  By doing so, it opened up more of America to more movies (and, later, TV show collections). Even though Blockbuster itself primarily stuck to cities and suburbs, it became a model for other chains that opened stores in small towns.

If people compared Blockbuster to McDonald's, that wasn't necessarily a knock, said Herbert. "They self-consciously modeled themselves on McDonald's, and at various points hired members of McDonald's upper management," he said.  But over the last decade, business took one hit after another. In a September article, The Billfold's Christopher Tucker described how independent video stores were put out of business. The same trends affected Blockbuster.  First there were DVDs, which were relatively inexpensive and intended for purchase, especially compared to the VHS titles that cost stores up to $100 a pop. With the advent of broadband, people started downloading movies and shows -- not always legally. Netflix and Redbox used the slim size of DVDs to their advantage. And finally, "Hulu was launched, and your average Joe and Josephine were introduced to Cloud Media," Tucker said.

Even Blockbuster's late fees came back to bite the chain in an unlikely way. In 1997, a man named Reed Hastings returned a late copy of "Apollo 13" to his local Blockbuster. He was assessed a $40 fee. Two years later, he founded Netflix.  Blockbuster was caught flat-footed by many of these changes. It could have purchased Netflix for $50 million in 2000, but passed. As Netflix rose, Blockbuster's attempts to compete on Netflix's terms -- especially through the mail -- foundered. It also tried to compete with Redbox using standalone kiosks. That didn't work, either.  By the time Blockbuster was sold to DISH in 2011, it was down to 1,700 stores, more than 7,000 fewer than its peak just seven years earlier. People had long since started devoting their Friday nights to streaming and downloading at home -- and if they were heading out, it wasn't to a Blockbuster.

The Onion, of course, nailed it. In a 2008 video headlined "Historic 'Blockbuster' Store Offers Glimpse Of How Movies Were Rented In The Past," the satiric site showcased a Michigan venue that "aims to transport visitors to a time before the Internet."  Like a version of Colonial Williamsburg, it had actors playing clerks and customers who described how the rental process worked. Onlookers watched the performance, stunned.  "It's really amazing that people had to go through so much just to get a movie," says a visitor in the skit.

http://www.cnn.com/2013/11/06/tech/gaming-gadgets/blockbuster-video-stores-impact/

Alexandria’s Old Town Theater Closing This Weekend

(By Tom Jackman, Washington Post, 05 January 2012)

The Old Town Theater, on King Street in Alexandria, has been showing “moving pictures” for almost 100 years, along with vaudeville, community theater, puppet shows, and anything else you could put on a stage or screen. But no more.   David Sachs reports in Thursday’s Alexandria Times that the Old Town is closing for good this weekend, the stuff inside auctioned off next weekend, and the great old marquee torn down shortly after that to make way for more retail space in the heart of Old Town.  Roger Fons, the managing partner, told Sachs he was tired of slow business, employee theft and a string of crummy movies. “You’ve got to have a product that is worth something,” Fons said of Hollywood’s recent output. He said the King Street Trolley bypassing the theater and increased parking fees may have contributed to declining income.

Sachs reports that the building has been sold to PMA Properties, which has applied to the city to “restore the original facade,” meaning remove the marquee. The building was built in 1914 for the purpose of “moving pictures, bowling alleys and billiards,” Old Town’s Web site says, and it’s been through various iterations in the ensuing 98 years. After it closed in 1999, Fons bought it in 2003 for $1.1 million, set it up as a non-profit, saw it closed in 2006 after he added a second screen without the city’s permission, and tried to keep it going as a “multi-entertainment center featuring all forms of the performing arts including film, theater, music and children shows.” But the losses were too great.  And so, its final movie? “Mission Impossible (4).”  I’ve left messages for Fons, but in the meantime here is Sachs’s fine story from the Alexandria Times.

Library Of Congress’s Collection Preserves History Of American Culture
(By Monica Hesse, Washington Post, April 22, 2012)

The librarians of the nation kick off Preservation Week today, the Holy Week for collection specialists, a time of dusty tomes and deacidification spray and the other niche materials used to preserve the great documents of our country: our presidential papers and Lincoln Bibles and notes handwritten by Emily Dickinson.  But for now, let us talk about Rise of the Dragon.  Rise of the Dragon was a video game released in 1990. It is about a private detective who sets off to find the drug kingpin responsible for the death of the mayor’s daughter. It came on a stack of six-inch floppy disks, which meant that it was played on a belligerent, boxy computer, a pile of tan plastic with a bubble screen and keys that got gummy and grimy and needed a Q-Tip.  Rise of the Dragon was designed to be played on precisely the machine that you finally sold at that garage sale nine years ago. No right-thinking person would still own this game.  The Library of Congress owns it.
 

"As you can see, we have the first 25 and the last 25 pages of [the game’s] source code, too,” says Greg Lukow, the chief of the library’s motion picture and sound division. He is proud of the library’s collection, which includes not only Rise of the Dragon, but also “Dexter,” “American Reunion” (the new “American Pie”; don’t pretend you don’t know), the home movies of nobody citizens, cached and abandoned Web pages, and defunct technologies.  Let us honor the preservation of the mix tape. Let us explore not who we were a long time ago, but who we were just yesterday, through the Library of Congress — the archaeologists of our recent history, of our impending obsolescence.  Books have worked the same way, more or less, for centuries. They are a remarkably intuitive technology. Open, read, close. “Or if you have a photo album, you know exactly what that is,” says Bill LeFurgy, who works for the National Digital Information Infrastructure and Preservation Program at the library. “It’s self-evident. It’s self-describing.” 

Now consider the disc, compact or floppy. The disc is not intuitive. The disc may contain photographs, but the disc will not show them to you unless you know how to open it — which, as everyone relocates to the Cloud, will become an increasingly antique skill. In 75 years, the disc will be modern civilization’s hieroglyph; the Rosetta Stone will be the yellowed user manual of an Apple IIe.  While books have endured unchanged, other forms of technology have bred with the speed of invertebrate insects, multiple generations each decade: 8-tracks, cassettes, CDs, flash drives, Google docs, Pinterest boards — old things abandoned for new things in increasingly short life cycles.  “I worry about this,” LeFurgy says. “I worry about things being thrown away.” He worries about the specks of dust that could get in crevices and render unusable the temperamental floppy. He worries about the documents saved on WordStar, the pre-Microsoft Word word processing system.
 

All of this worry coincides (appropriately, ironically) with the rise of self-curation — our Instagrammed era in which every meal, photo, event and thought is hashtagged and filed away with a virtual Sharpie. But for all of the organizational skills that Pinterest has bestowed upon us, we are remarkably unconcerned with how accessible our virtual collections will be to our progeny.  “Corporations,” LeFurgy notes dryly, “are not in the forever business.”  Technology companies and Web sites are guided by profitability, not historic duty. They move with the times and shut down when they must. It might be easier to access Granny’s 80-year-old diaries than it is to access your now-defunct Friendster profile; it may be more possible to recover sound from a wax cylinder than from a digital audio tape circa 1987.  It turns out that we modern humans are not actually good at curation. What we are good at is short-term hoarding. We tag and tag with disappearing ink. For the generations hence, and the advanced, beam-me-up technology they are sure to have, we would be completely inscrutable, Generation Disposable.
 

Take Route 66, for miles and miles, then turn off on 29 South, past the dairy stands and fruit stands and churches advertising “11: a.m. Cowboy Services.” Eventually you’ll come to a giant structure built into the side of a hill that looks like it was originally a Cold War bunker, because that’s what it was. This is the library’s Packard Campus for Audio-Visual Conservation. It’s where the country stores priceless artifacts, like Thomas Edison’s 19th-century films. It is also where the country stores “General Hospital” on VHS, “Justin Bieber: Never Say Never” on digital cinema package, and hundreds of thousands of other historical files, like the personal collection of J. Fred MacDonald, a Chicago man who built an extraordinary repertoire of industrial and educational films.  “What we have here,” Lukow says, “is a mint collection of American creativity.”
 

Lukow is broad and very tall. He looks and sounds the slightest bit like John Lithgow. He’s in charge of the collections out here, of the petabytes of information lurking underground, in vaults climate-controlled to 50 degrees.  On a recent afternoon, he led a private tour through the vaults, and up and down the go-for-miles hallways populating the building. He leads through the visual department, with giant bins full of media that pour in every week either from private collectors or through the Copyright Deposit System. He leads through soundproofed studios, where the library stocks dozens of needles of varying thicknesses to better play old records.  In a dim, jammed room that everyone calls “the museum,” the library stores shelf after shelf of recently obsolete technology: stacks of CD players, cassette players, Sony VCRs.  “These are about the most valuable things in here,” Lukow says as he points to a row of hard cases tucked just above eye level. They contain two-inch video heads, used for playing back media. Nobody makes them anymore, and there are only two well-known facilities in the country left that repair them.
 

Across the hall from the museum, two technicians monitor troops of robot-machines as they digitize hours, yards, miles of content. Tiny screens display the activity. Here are the Boston Red Sox circa 1999, next to a late-era Johnny Carson. Here is Tina Fey doing Sarah Palin on a 2008 episode of Saturday Night Live.  “Oh, we’re on ‘Silver Spoons’ now!” A technician peers at the screen closest to him. This is excellent news. “We’ve been on ‘All My Children’ for weeks.”  Maybe preservation is overrated, really, if what we’re preserving is the rise and fall of Susan Lucci’s hair, the never-ending “American Pie” franchise, the extemporaneous Twitter feed (yes, the library saves those, too). 
 

Those of us who live in this time are cognizant enough to be frequently embarrassed about this time. No one looks forward to the day when she may curl up with her granddaughter and a remote control, and say, “Let’s watch the hero of my youth, Snooki.”  One of the benefits of a disposable culture is that we can dispose of it, brush it all up with a Swiffer, lose it with our latest upgrade. The term papers that went missing with your ancient Dell weren’t good anyway — the only thing they would reveal to later generations was that students have never understood the difference between “affect” and “effect.” Let it rot, leave it be, allow us to forget cultural behaviors that haunt us.
 

But then, our recent past it not any trashier than the pop culture of more distant pasts; the difference is that much of that trash ended up in the garbage. There is meaning in the gleaming blond of Ricky Schroder’s hair; we’re just not far enough away to understand it yet, and by the time we are, the tape will have disintegrated.  Maybe the archeologists of the near future will be able to sift through our floppies, our flash drives. Maybe they will sit down for hours and master all of the levels of Rise of the Dragon, and hidden in the source code will be all of the secrets of humanity, and we will completely understand who we once were.

http://www.washingtonpost.com/lifestyle/style/2012/04/22/gIQABtcoaT_story.html?wpisrc=nl_lunchln

 

 

-------- Original Message --------

Date:  Sat, 6 Nov 2010 04:57:06 -0700 (PDT)

Subject: Changes Are Coming

LOTS OF TRUTH IN THESE PREDICTIONS. . . . .  There is nothing political about this email. It simply points out very probable changes that are in our future.  CHANGES ARE COMING ---- Whether these changes are good or bad depends in part on how we adapt to them. But, ready or not, here they come

1. The Post Office.  Get ready to imagine a world without the post office. They are so deeply in financial trouble that there is probably no way to sustain it long term. Email, Fed Ex, and UPS have just about wiped out the minimum revenue needed to keep the post office alive. Most of your mail every day is junk mail and bills.

2. The Check.  Britain is already laying the groundwork to do away with checks by 2018. It costs the financial system billions of dollars a year to process checks. Plastic cards and online transactions will lead to the eventual demise of the check. This plays right into the death of the post office. If you never paid your bills by mail and never received them by mail, the post office would absolutely go out of business.

3. The Newspaper.  The younger generation simply doesn't read the newspaper. They certainly don't subscribe to a daily delivered print edition. That may go the way of the milkman and the laundry man. As for reading the paper online, get ready to pay for it. The rise in mobile Internet devices and e-readers has caused all the newspaper and magazine publishers to form an alliance. They have met with Apple, Amazon, and the major cell phone companies to develop a model for paid subscription services.

4. The Book. You say you will never give up the physical book that you hold in your hand and turn the literal pages. I said the same thing about downloading music from iTunes. I wanted my hard copy CD. But I quickly changed my mind when I discovered that I could get albums for half the price without ever leaving home to get the latest music. The same thing will happen with books. You can browse a bookstore online and even read a preview chapter before you buy. And the price is less than half that of a real book. And think of the convenience! Once you start flicking your fingers on the screen instead of the book, you find that you are lost in the story, can't wait to see what happens next, and you forget that you're holding a gadget instead of a book.

5. The Land Line Telephone.  Unless you have a large family and make a lot of local calls, you don't need it anymore. Most people keep it simply because they've always had it. But you are paying double charges for that extra service. All the cell phone companies will let you call customers using the same cell provider for no charge against your minutes

6. Music.  This is one of the saddest parts of the change story. The music industry is dying a slow death. Not just because of illegal downloading. It's the lack of innovative new music being given a chance to get to the people who would like to hear it. Greed and corruption is the problem. The record labels and the radio conglomerates are simply self-destructing. Over 40% of the music purchased today is "catalog items," meaning traditional music that the public is familiar with.  Older established artists. This is also true on the live concert circuit. To explore this fascinating and disturbing topic further, check out the book, "Appetite for Self-Destruction" by Steve Knopper, and the video documentary, "Before the Music Dies."

7. Television.  Revenues to the networks are down dramatically. Not just because of the economy. People are watching TV and movies streamed from their computers. And they're playing games and doing lots of other things that take up the time that used to be spent watching TV. Prime time shows have degenerated down to lower than the lowest common denominator. Cable rates are skyrocketing and commercials run about every 4 minutes and 30 seconds. I say good riddance to most of it. It's time for the cable companies to be put out of our misery. Let the people choose what they want to watch online and through Netflix.

8. The "Things" That You Own.  Many of the very possessions that we used to own are still in our lives, but we may not actually own them in the future. They may simply reside in "the cloud." Today your computer has a hard drive and you store your pictures, music, movies, and documents. Your software is on a CD or DVD, and you can always re-install it if need be. But all of that is changing. Apple, Microsoft, and Google are all finishing up their latest "cloud services." That means that when you turn on a computer, the Internet will be built into the operating system. So, Windows, Google, and the Mac OS will be tied straight into the Internet. If you click an icon, it will open something in the Internet cloud. If you save something, it will be saved to the cloud. And you may pay a monthly subscription fee to the cloud provider. In this virtual world, you can access your music or your books, or your whatever from any laptop or handheld device. That's the good news. But, will you actually own any of this "stuff" or will it all be able to disappear at any moment in a big "Poof?" Will most of the things in our lives be disposable and whimsical? It makes you want to run to the closet and pull out that photo album, grab a book from the shelf, or open up a CD case and pull out the insert.

9. Privacy.  If there ever was a concept that we can look back on nostalgically, it would be privacy. That's gone. It's been gone for a long time anyway. There are cameras on the street, in most of the buildings, and even built into your computer and cell phone. But you can be sure that 24/7, "They" know who you are and where you are, right down to the GPS coordinates, and the Google Street View. If you buy something, your habit is put into a zillion profiles, and your ads will change to reflect those habits. And "They" will try to get you to buy something else. Again and again.

 All we will have that can't be changed are Memories.

Making Best Buy Better

(By Farhad Manjoo, Washington Post, 17 April 2012)

Best Buy made its fortune by offering lots of choices. Now, on the way to its grave, it's still promoting an endless selection.  Buying a television should be easy. In theory, all you’ve got to do is pick a screen size, set a budget, and choose the best model that fits your criteria. What does best mean? The TV industry would like you to believe that every TV is unique—that there are major differences in picture quality and features across different brands, and that you should spend a lot of time researching before you buy. The truth, though, is that manufacturers add unnecessary features and bombard us with confusing specs to disguise the fact that most TVs are pretty much the same.  It’s not just televisions. We live in an age of commodity electronics, where most gadgets are more or less interchangeable. You aren’t likely to notice any major differences between a product made by Samsung versus one made by Toshiba—they’ll both likely be made out of the same parts, in the same way, and perhaps in the same factories. Given these similarities, if you spend more than 10 minutes comparing different models of any type of gadget, you’re doing it wrong.

But you’d never realize this if you were to visit your local Best Buy. America’s largest electronics retailer made its fortune by offering lots of choices. Now, on the way to its grave, it is still waving the banner of endless selection. My local Best Buy carries nearly a dozen nearly identical 32-inch TVs, a similar number of 42-inch sets, and no fewer than 20 different 55-inch TVs. You’ll find the same bounty in other product categories. If you’re looking for a point-and-shoot camera, Best Buy wants you to choose between 15 different models. Need a two-terabyte external hard drive? My store has six. In the market for a 23-or-so-inch computer monitor? Pick one of nine.

Best Buy is in a lot of trouble. Once the undisputed leader in technology retail—it vanquished Circuit City, CompUSA, and every mom-and-pop electronics store in the country—the company is now being killed by Amazon online and Apple offline. In March, Best Buy reported a $1.7 billion quarterly loss and announced that it would close 50 stores. Then, last week, the firm’s CEO Brian Dunn suddenly resigned. The company declined to fully explain what prompted Dunn’s departure, but the Wall Street Journal has reported that Best Buy has been investigating an alleged relationship between Dunn and a younger subordinate.  Whatever the reason behind it, Best Buy should use Dunn’s departure as an opportunity to rethink how it sells gadgets. In particular, it’s time to abandon the idea of endless selection. If Best Buy wants to survive, it’s got to replace its hulking, teeming stores with smaller, less crowded, more intimate spaces. When you walk in to buy a 32-inch TV, the guy in the blue shirt shouldn’t make you choose between a dozen nearly identical models. Instead, he should show you a single set, a TV that Best Buy’s experts have determined offers the best features at the best price. The firm could do the same across its inventory, culling the tech universe down to a few essential, can’t-beat products. In this way, Best Buy would transform itself from a supermarket into a boutique—a place with fewer things for sale and lots of friendly, sophisticated, helpful experts who’ll save you the hassle of researching your next TV or PC purchase. They’ll do all the work for you.

Why would going small work for Best Buy? Because big has become the domain of the Web. There once was a time when massive selection was a key differentiator in physical stores—the more stuff you stocked, the more likely you were to appeal a wider range of customers. But now, no matter how many TVs Best Buy keeps in stock, its selection will never match that of Web retailers. If you’re the type of customer who studies every 32-inch set before choosing one, you’re not likely to bother with a store.  Maintaining a big selection costs big money and offers a perverse advantage to Best Buy’s online rivals. By keeping so many TVs on its sale floor, Best Buy is offering itself up as a showroom for Amazon: Potential customers can walk into a store, check out the stock, and go home and buy the product they like best online. Then there’s the “paradox of choice”—the idea that giving consumers lots of retail choices tends to paralyze and confuse them, and sometimes pushes them to leave your store empty-handed. Though this theory is controversial, the runaway success of Apple’s retail stores proves that a small, curated product line doesn’t necessarily hurt sales. Why wade through 30 laptops when you only want to buy one?

In his last few months at Best Buy, Dunn made a few smart moves to turn the firm around. Last year, the company announced a plan to shrink some of its stores and sublease the extra space to new tenants. The firm is also planning to replace some of its shuttered stores with new, tiny locations that will be called Best Buy Mobile. These outlets will be situated in shopping malls, and each location will take up only take up about 1,200 square feet. (By comparison, the average big-box Best Buy is 45,000 square feet, while a typical Apple Store is about 6,000 square feet.) But turning Best Buy around is not just a matter of downsizing. The company also needs to change its approach to customer service. When I walk into a Best Buy, I find it difficult to find what I’m looking for. It’s usually a hassle to get help—there are never enough employees on the floor—and when I do get a hold of someone, there’s a good chance the person can’t help me. Last year my wife and I went to Best Buy to look for a new refrigerator. We found something we liked, but we had a simple question: Would this model fit in our kitchen? We asked an associate if the width listed on the fridge’s tag was its dimension with the door open or closed (that turned out to be a key factor in our kitchen). He didn’t know. He called over another blue shirt, but that guy didn’t know either. Eventually the salesman offered to go to the back to get a tape measure; it took him about 10 minutes to find one. We didn’t end up buying the fridge.

Shrinking its selection would improve this situation—the fewer products it sells, the easier it would be for Best Buy’s employees to become experts about all of the goods on offer. It would also make it easier for customers to find stuff. Still, the transformation I’m calling for is radical—it would involve massive physical restructuring, as well as a program to re-educate the company’s staff. It won’t be easy. It’s not guaranteed to work. On the other hand, if Best Buy sticks to its current course, it’s certain to die. Given the alternative, the company has no choice but to make a fundamental change.

 

No Pennies For Your Thoughts

(By Matthew Yglesias, Slate.com, April 3, 2012)

One United States dollar is currently worth almost exactly 99 Canadian cents. It won’t be long, though, before it will be impossible to put 99 cents in your pocket north of the border. That’s because Canada is poised to implement a longtime dream of American budget wonks (and Aaron Sorkin) and withdraw the penny from circulation.  The basic problem with pennies is that they cost a lot of money for the government to make. Normally, minting coins and printing bills is a profitable undertaking for a government running a fiat currency. Citizens use money to conduct transactions with one another, and ultimately to pay taxes. But as long as that money is sitting around in pockets and sock drawers, it’s as if the government has received an interest-free loan. After all, the resources needed to produce a coin or a piece of paper with Alexander Hamilton’s picture on it are pretty trivial. But in the case of the penny, the problem for the government is that the actual value of the thing is trivial as well.

Since 1900, the price level in the United States has increased 25-fold—in other words, a penny in 1900 had about the same real purchasing power as a quarter does today. Even today there’s not much you can buy for 25 cents, but put a few quarters together and you’ve got yourself some time in a parking space, a load of laundry, or a soda from a vending machine. A penny, by contrast, has almost no purchasing power. That means that the real resources involved in producing one, though hardly enormous, are big enough to make it unprofitable. Ten years ago, a penny cost slightly less than one cent to produce, but rising commodity prices mean there are now more than 2.4 cents’ worth of metal and labor in each one-cent coin. In 2011, the net cost to the taxpayer of minting pennies was a bit over $60 million. In the scheme of things, that’s not all that much money, but it’s money that’s worth saving.

Budget-induced alterations in coinage are hardly a new idea. People often think that pennies are made of copper, but that hasn’t been the case for some time. From 1864 to 1942, the penny was bronze—i.e., an alloy of 95 percent copper with 5 percent tin and zinc. But in 1943, the powers that be wisely decided that beating Hitler was a higher priority than minting low-value coins. Copper shortages had been ameliorated by 1944, but rather than returning to bronze we moved to a tin-free copper/zinc brass alloy. By 1946, wartime austerity was on its way out and tin got back into the coins, only to be removed again in 1962.

The so-called “Great Inflation” that proceeded over the next two decades created the original version of today’s anti-seigniorage problem. Suddenly the country was putting more than one cent’s worth of bronze into each penny. The solution was a shift to today’s penny, which consists of a 99.2 percent zinc core sheathed in a plating of full copper. It was a clever idea, but the price level has more than doubled since 1982, when the switch was last made. In its Fiscal Year 2013 budget proposal the Obama administration asked for “increased flexibility for the U.S. Mint in coinage” to allow for yet another switch and help us evade the high price of zinc.  Since the zinc lobby itself is the main impediment to penny abolition, as long as we’re taking them on we might as well go all the way and just kill the coin off. This is especially true because the budget cost of the penny is in some ways the least of its problems. The U.S. government didn’t make steel pennies in 1943 because it needed more money, but rather because it wanted more copper available for war production.

The same basic issue applies today. Some forms of government spending can stimulate economic activity, but taking two cents’ worth of zinc and stamping it with a one-cent mark just deprives the rest of the economy of potentially useful metal. Consuming commodities to create quarters performs a valuable service by giving us a useful medium of exchange, but pennies are at least as much a nuisance as a convenience.  The main case against scrapping the penny—mounted by Eric Wen at the New Republic, citing research from Penn State’s Raymond Lombra—is that firms would round up when setting prices, and this would disproportionately hurt the poor, who are more likely to use cash. That’s likely true, but on the upside, prices should also get “stickier” in the face of inflation. In other words, 99 cents might be rounded up to a dollar this year, but they’d then stick at a dollar even in the face of 2 percent inflation before rising by five cents a few years down the road. Any positive or negative impact on pricing, then, is only going to be temporary.

Meanwhile, complaints that money-saving measures may hurt the poor should be put in perspective. Right now, Congress is cutting spending on programs aimed to save poor children from brain damage induced by lead poisoning, compared with which, going penny-free looks like a delightful form of austerity.  As a bonus to help tide people over, Congress could declare that, as soon as new pennies stop being minted, old one-cent pieces would instantly be worth five cents each. Given the currently depressed state of the economy, that would work as a mild form of instant stimulus. People would be inspired to scrounge around their couch cushions and change jars in search of newly valuable pennies, and the pace of overall spending would get a little boost.

 

http://www.slate.com/articles/business/moneybox/2012/04/abolish_the_penny_the_united_states_should_follow_canada_s_lead_and_ditch_one_cent_coins_.html?wpisrc=nl_lunchln