What’s yours?

scheduleNovember 6, 2018

What do you own? Right now, what possessions do you have? A car? A house? A computer? A phone?

At one point the U.S. economy was based around the exchange of goods. We could trade a good for a good or service. When money became ubiquitous we would trade money for goods or services. If I provided you money for a screwdriver, I owned the screwdriver at the end of the transaction.

This model changed while no one was looking. What do you pay for when you purchase something now? Suppose we consider one of the best selling products in the U.S. Let’s look at the iPhone. This device is not meant to be a computer. It is meant to be the opposite of an ATM. You put money into it.

An iPhone is only as useful as the data service provided to it. Data service is something you pay for. Wether you use T-Mobile, Sprint, or AT&T you pay to have this device connected to the outside world. Consider that banks and credit unions pay for their ATM machines to be connected to networks. Now you are paying for the convenience of having the same access to your money, all the time, in your pocket.

The cost of the ATM has been moved from the bank or credit union, to you. This is only the first example of technology moving the cost to you. The recording industry is an example of an entity everyone loves to hate. Let’s go bigger and talk about media and media companies in general.

You use your iPhone to purchase music, books, magazines, movies, and pictures. How much physical space have you taken up? None. To quote late night TV, “But wait, there’s more…” You didn’t buy any of that media. You used a subscription to purchase access to the media. You don’t actually own anything. You are allowed access.

Let’s look at the model again. You are paying (through a subscription) to access networks that you pay (through a subscription) to allow you to read books, listen to music, watch movies and play video games. The video games access servers that run as long as there are enough subscribers paying for access. When not enough subscribers pay for access, the server is shut down. Even if the game is one you enjoy, or is still playable.

The device you are using has limited resources. Each year improvements are made to the available resources in the device. As new resources are added the software in the device (that you get for “free” so that you can be charged for subscriptions) demand access to the increased resources. Eventually a functional device is rendered unusable because the environment (ecosystem) no longer supports the resource limitations of an older device.

Good news though, when the next device comes out you can buy the new device and receive a portion of the value of your old device. This way you can keep up with the change in technology. You pay full price for a device, own it for a year or two, and then sell it back to receive credit towards your next device.

Have you ever done this with a hammer? A hand mixer? A stove? No? What if told you I was going to sell you a stove for full price and then in two years give you 50% of the value of the stove towards a new stove? Would you be interested in constantly upgrading your stove? Likely you would not be very interested. Why? How many people see your stove on a daily basis?

Cars, Phones, even video game consoles are all publicly inspectable. Video game consoles? How so? If you own an XBox with Halo 2 you can invite a friend to play with you. If the have a PlayStation, they have to turn you down because of an artificial incompatibility. Microsoft doesn’t make Halo 2 for PlayStation. If your friend wants to play Halo 2 they have to buy an XBox. If friends are people that we have commonalities with, then this matters.

But what does this have to do with ownership. You are paying a subscription for access to networks so that the device you paid for can have access to video games. Not so that you can OWN a video game, but so that you can access video games. You access the people playing the games this way too. And again the company selling the video game decides when it’s time for you to move on from the video game you are playing.

You don’t own the game on media so you can’t resell the game. Since the video game connects to a server that you don’t own and don’t control, you can’t play the game past when the company that created the game and owns the server allows. You are paying for what used to get you permanent access to a game (assuming things don’t break) to get temporary access based on a companies timeline. Of course the same problem of resources increasing in devices over time leading to obsolescence applies here as well. Only the console companies aren’t as interested in giving you money for a used console.

Let’s talk about that car you think you own for a moment. Either you paid for it and have the title, or you didn’t (and don’t have the title). If you don’t have the title, you don’t own the car. But there’s more to it than that. There’s risk. Driving a car makes you a risk to people around you. This is why insurance exists. Even if you paid for the car, you are still paying for insurance, gas, and maintenance. You are paying for the risks involved with the car.