April 2011

Buy, waste, buy

While the phrases “save the planet” and “think green” are on everyone’s lips, there are more unknown forces hidden in the world of economics that might be stronger. Planned obsolescence is a frequently used product strategy to make customers buy products over and over again with the goal to raise economic profit. Does the strategy create a healthy economy or only generate unnecessary waste?.

 


Planned obsolescence, also known as built-in obsolescence, aims to make customers buy more products at a time earlier than they normally would. Producers make products that break before they have to, urging customers to buy something a little newer and a little better, a little sooner. Obsolescence defines the process of phasing out usefulness. By planned obsolescence, we create products that will not be considered as useful after a short period of time, even though they still function well. This strategy was first developed in the 1920s, and was thought to raise economic profit by limiting the time between purchases. Development of mass production made it possible to produce more goods in less time, and companies were able to produce goods from cheaper components that broke sooner. Planned obsolescence might seem to give us nothing but negative ripple effects, but it is also what runs our capitalist economy. The strategy has also been used to raise the economy in developing countries.

Desirability and function

Today, we find that planned obsolescence exists in most areas of production and economists divide it into two categories: Obsolescence of desirability and obsolescence of function. By presenting the iPad, Apple created needs among its customers all over the planet. Another strategy is to extend the steps in product development, this way you must buy a 3G iPhone, even though you got the older version six months before. This is called obsolescence of desirability and works in a psychological way. The aim is to wear out a project in the customer’s mind. To succeed with this strategy in an economic sense, you have to make sure that the customers will come back and continue to buy the same product. That makes it important to generate hype about your products, which explain the rise in commercials and propaganda events, like the overemphasized presentation of iPad in recent years. Obsolescence of desirability can also be a trap for producers, because they create customers who want it all. This includes goods from other producers. Fashion and design are also a part of obsolescence of desirability. By creating trends, the fashion business creates needs as well. Even though there is no development in the function of pants, you still feel like you need to buy a boot cut when they are plastered all over the pages of a magazine.

Planned obsolescence might seem to give us nothing but negative ripple effects, but it is also what runs our capitalist economy.

Obsolescence of function works by creating products that will break sooner than must. Producers have to decide early in the design process for how long a product will live. Every component that the final product will consist of is made after these specifications, from which producers calculate the amount of time for guarantee. You often find planned obsolescence of function when goods are developing, and new technologies replace old. When producers continued to sell VHS movies while developing the DVD format, they were engaged in obsolescence of function. While they sold one type of goods, they were making it obsolete by developing a replacement for in the field. This tactic is especially frequent in the world of software. When a new version of software is introduced and it contains new elements, producers can easily force customers to buy it by preventing the new data to work with an older version.

Repair or replace

Another element of obsolescence of function is to limit a product’s life, by forcing customers to buy a whole new product, even if only one component should break. This works by making the individual components more expensive than the entire new product, or if the produce refuses to sell components separately all together. Many costumers experience that it is cheaper to buy a whole new product, than to repair an old one. Often times, the prices of components are calculated just above the replacement costs, in order to tempt the customers to purchase a whole new product instead. This is also made possible by making cheaper goods in the first place, using cheaper components.

The latest “innovation” of this strategy, is creating cell phones without a changeable battery. This makes the phone useless in few years, since the battery has a fixed shelf life. It is argued that this is an attribute for customers, since they would never continuously use the same phone for more than a couple of years anyway. In this way, we all benefit from the use of cheaper components. That might be true, but there is also reason to ask about where the urge for a new cell phone originates. Through a technical progress called value engineering, producers calculate both design and technical qualities so they are equivalent to the amount of years the product is meant to live. This prevents over-engineering, meaning that more expensive components are used more than necessary, which, in turn, makes more expensive products.

Developing the economy

From an environmental point of view, the future does not look so bright in a world of planned obsolescence. Cheap components create more waste than is necessary on this planet. Meanwhile the strategy is constantly pushing producers to develop their products, which creates innovation. Generally speaking, innovation could also cause positive environmental effects by creating more environmentally friendly products, for example. Economists are divided on this matter, since it can also delay development by producers buying patents and developing several different versions of a product step by step. Then, it might be compulsory to buy all of the products, to follow trends and development. There is no doubt that planned obsolescence initiates a race between producers, but there is reason to argue if the race is about making new products or if it is about making more money.

While we are saving the planet by bringing our own reusable bags to supermarkets, we are also producing more waste than ever. It is difficult to give an answer to whether or not planned obsolescence is creating healthy economics or unnecessary waste. Our upgrade economy is built on planned obsolescence and it does keep the product ball running. Even though it is difficult to imagine a capitalist economy without planned obsolescence, we see some tendencies toward the need for change from a customer’s point of view. Bloggers have declared war against planned obsolescence, ask their readers to buy less, and treat their goods with more respect. One can also find web pages that specialize in repairing products, with both bought and self-made components. This, and being aware of this issue, just might save us both money and from waste, by not throwing away things before we have to.

Peaches for pesos

The internet offers a lot of possibilities that invite alternative forms of advertising. Through a web page called IndieGoGo, the producers of Durazno set up an account where people can donate their money voluntarly. Here you can donate upwards of one dollar and every cent counts towards a low budget movie. Durazno is the first film from the ARBOL project, which aims to help young people, especially women, finance their movies and gain access to the film industry.

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