Category: Consumer Product

Consumer Shared Computer Network (CompuServe)

CompuServe is the first computer network targeted towards ordinary people though it did not start out that way.

Background

Jeff Wilkins sold burglar alarms. His father-in-law ran a small insurance company and needed to buy a computer. However, the DEC model he wanted had far more computing power than his father required.

Wilkins realized he could use the computer modem to sell extra capacity to other businesses that did not want to purchase or maintain an entire computer. Companies had been sharing mainframe computers for some time. However, Wilkins is the first to miniaturize the idea, to sell time on a relatively low-power computer.

In 1969, he launched the business and it quickly became popular. Wilkins quit his job selling alarms and set out full-time selling computing power.

He expanded the idea in 1978 with the introduction of personal computers, though early-on there wasn’t much reason to purchase time from him.

CompuServe Grows

In July 1980, the Columbus Dispatch newspaper became the first paper to publish electronically, on Wilkins’ CompuServe. Thanks to relatively low-cost personal computers the service began to rapidly grow. In Q3 1980, CompuServe had 3,600 subscribers. By the end of Q1, 1981, they’d grown to over 10,000 customers.

Interestingly, the most popular CompuServe app was text chatting. About 20 percent of total usage consisted of people chatting to one another. Reading the newspaper accounted for just 5 percent of total usage.

By 1984, CompuServe charged $5/hr. after 6 PM but the service was mind-numbingly slow at 300bps.

Despite the slow speed, the service continued to grow. By 1984, CompuServe had 60,000 subscribers. In 1986, tax preparation company H&R Block purchased the company, paying $68 million. By 1993, CompuServe had over 1.5 million subscribers throughout the world.

Disruption

Eventually, CompuServe was overtaken by upstart competitor America Online (AOL) which offered lower rates and more content. However, AOL was soon enough shuttered by cable companies and internet service providers. These market incumbents often provided faster speeds at lower prices often bundled with television and phone service. Additionally, they enjoyed US government monopolies on the cable lines used to transmit high-speed data.

Genetic Testing

Genetic testing identifies genetic patterns, including irregularities. In 2019, genetic testing is typically used to search for abnormalities and susceptibilities. However, new treatments under development target the specific traits of patients or disease. These treatments attack and cure at the genetic level. In addition, genetic testing is entertaining. People find unknown relatives or trace family origin.

Background

In April 1953, James Watson and Francis Crick worked with Rosalind Franklin to discover that DNA is a double-helix. They explained how DNA self-replicates and encodes hereditary information. Eventually, Watson & Crick won the Nobel Prize for their work (Franklin died, rendering her ineligible). However, while they accurately described the form of DNA they did not explain the chromosomes that render our biological blueprint.

In 1956, Joe Him Tjio and Albert Levan released the first substantive work on chromosomes, the core of genetic testing. Particularly, they found human DNA contained 46, not 48 as previously believed. Almost more importantly, they identified how to read information from chromosomes.

Not long after, the earliest genetic testing began. Eventually, reports emerged concurrently identifying the genetic abnormality responsible for Down syndrome. Next came reports tying Turner and Klinefelter syndromes to genetic anomalies.

Markedly, progress identifying genetic differences proceeded slowly until the 1980s. Eventually, new technologies lowered the cost and increased the value of the information. By the 1990s, these techniques increased in speed and decreased in cost.

Human Genome Mapping

In 1990, scientists started a project to map the entire human genome, the Human Genome Project. It finished in April 2003, and cost about $2.7 billion USD. By late 2018, one company ran a sale to sequence an entire human genome for $200. The full price was $999 though the company, Veritas, predicts the retail price for a full DNA sequence will be $99 by 2024 at the latest.

Countless DNA sequencing companies exist that read and report partial DNA results. For example, 23 and Me offers a “Health + Ancestry Service.” For $199, customers receive over 125 gene-related health reports plus a fun family history report. The family history report, “Get a breakdown of your global ancestry by percentages, connect with DNA relatives and more,” costs $99 alone.

Aerosol

Aerosols are essentially fog. They’re water-based micro-drops suspended in a gas, which is usually air.

In 1926, Norwegian Erik Rotheim developed the first aerosol sprayer. Eventually, he applied for Norwegian and US patents and worked towards commercialization.

First, he worked towards aerosolizing paints and varnishes but customers showed no interest. Subsequently, he continued looking for commercial applications but died in 1938, at age 40.

Rotheim’s estate sold the patent to a US company where the technology lay largely dormant until the 1940s. Eventually, the military realized the usefulness of an aerosol bug spray during WWII, the “bug bomb.”

Rotheim used a pressurized gas that kept a steady pressure inside the can, releasing a set amount of liquid and gas. In 1949, American Robert Abplanalp invented the aerosol spray valve, that enabled aerosolization without a pressurized gas … the spray pump.

Aerosols became popular in the 1950s with countless uses. Women sprayed products in their hair, people painted with airbrushes, car finishes became smoother, window washing solutions sprayed evenly. Common uses include medicine, spraying pesticides and insecticides, and for fuel injection systems. These products are so common today it’s hard to fathom that the innovation is relatively recent.

35-millimeter Photography

35mm film remained the standard for photography for decades until digital photography. The film is important because it enabled the miniaturization of cameras.

Background

The Houston brothers invented roll film and sold the rights to George Eastman. Eventually, Thomas Edison purchased 70mm roll film from Eastman to make movies. Subsequently, Edison employee William Dickson sliced it in half, creating 35mm roll film.

Cameras at the time typically used 70mm or larger film. Consequently, they were large, lumbering things, not easy to carry around.

In 1913, the “American Tourist Multiple” became the first 35mm still camera available for purchase. However, it cost $175, just under an average year’s wages. Needless to say, it never caught on.

In 1913, Oskar Barnack, a Leica employee, began to develop a mass-produced 35mm camera. WWI interfered with the development and commercialization effort. However, Leica introduced the wildly popular company Leica I in 1925. Markedly, The small size was a dramatic departure from prior cameras.

35mm Cassette Fim

In 1934, Kodak released preloaded 35mm cassettes that dropped into a camera. Prior to that innovation, photographers had to load film into their cameras in darkrooms.

In 1936, the inexpensive Argus A 35mm camera was introduced. Combined with Kodak’s easy loading film, 35mm photography exploded in popularity. Subsequently, that same year, the Single Lens Reflex (SLR) camera was introduced, allowing photographers to see the exact image the film would record.

By the 1960s, SLR cameras with interchangeable lenses dominated the market. In the 1980s, Kodak release single-use cameras pre-loaded with film. Users took pictures and brought the entire camera, not just the film for developing. Kodak had invented and patented the digital camera a half-decade before, in 1975, but ignored the invention.

Digital Dominates

In 1997, Kodak sold over a billion rolls of film. Twelve years later, on June 22, 2009, announced the cessation of Kodachrome film after 74 years of production. The company declared bankruptcy in January 2012. Digital photography now dominates imaging. However, in 2019, the company still produces a limited line of traditional films for professional photographers.

Modern Advertising

Before Albert Lasker advertisements tended to be crude, raising awareness or reinforcing a brand name. Many ads were not much more than offers to purchase something, with no overarching idea. Lasker used the emerging science of psychology and budding technology of radio to radically change advertising.

Background

Born in Germany, Lasker moved to the US as a baby. He was raised in Texas and, as a teenager worked on the Congressional campaign for Republican Robert Hawley. In the late 1800s, Texans still remembered the Civil War and Republicans stood little chance of election. However, thanks to some clever politicking and a little luck Hawley won.

Lasker then moved to Chicago joining the prestigious advertising firm Lord & Thomas. He became a partner at the age of 23 and outright purchased the firm at the age of 32.

The success of his ad campaigns is legendary. Many Lasker ads focused on women, on the assumption they controlled purse strings. Traditional ad campaigns usually focused on men, on the incorrect assumption that as primary breadwinners (at that time) they must also be the decisionmakers related to spending.

Campaigns

Few women smoked and he devised a campaign that Lucky Strike cigarettes helped keep them slender.

Lasker realized nobody likes to do dishes and created a campaign that Palmolive soap is good for the hands, focusing on the positive.

A spinoff from paper giant Kimberly-Clark created a new type of absorbent material. They sold it to the army for use in WWI. French nurses found it worked great as a menstrual pad. Kimberly Clark saw the market opportunity but found the concept embarrassing. Lasker branded the waste-paper product “cellucotton,” so it sounded natural, and created a wholly-owned subsidiary, the International Cellucotton Products Paper Company with one brand, Kotex. He branded the menstrual pads “sanitary napkins” and marketed a box where women could put in a coupon and receive a pack without talking to men. He also created a curriculum for teachers to explain to girls how to use pads. The modern menstrual hygiene market was created.

He branded the first sports stadium, Wrigley Field.

After a betting scandal, he invented a “baseball commissioner” to restore confidence in the integrity of professional baseball.

Food & Politics

Californians were cutting down orange trees for lack of interest. He invented the idea that oranges should be juiced and that orange juice is a vital part of breakfast. Then he created the Sunkist brand. Demand for orange juice boomed.

Raisins were never especially popular until the California Associated Raisin Company (CARC) approached Lasker. He rebranded the company Sun-Maid and sold the raisins in small boxes sent to lunch with students. Sales boomed. How could a company sell a new recipe they had for wheat and rice? Puffed Wheat and Puffed Rice became breakfast cereals.

He worked for Republican Warren Harding and focused on the 22 million women who just won the right to vote. Harding won by a landslide.

Kimberly-Clark asked if he could find a use for the thin paper used in WWI gas masks; Kleenex was born.

Radio Ads

Lasker decided to become the sole sponsor and promote a radio show, Amos & Andy. His client, Pepsodent, paid him in stock. Sales doubled and became the second-largest shareholder in the company.

His third wife was heavily involved in the Birth Control Federation, a group founded by Margaret Sanger. The public did not like the name. In response, Lasker rebranded the group Planned Parenthood.

After retiring with a then staggering sum of $45 million he became a philanthropist, donating heavily to the American Society for the Control of Cancer. They struggled for donations until Lasker suggested a name change, The American Cancer Society. After convincing a popular radio show to do a segment on cancer, a dreaded concept, donations “flooded in.”

Strategically Addictive Drugs

Background

Cigarettes are addictive. However the availability of tobacco around the world, in the early 1800s, limited them as a mass-market item. Even the largest wind-powered ships contained limited space. Filling ships with enough tobacco to addict a whole country was not viable during this period.

However, another product did fill this role, opium. Tobacco and opium are considered to be equally addictive, but opium is substantially more difficult to stop using. Furthermore, opium is significantly more compact than tobacco. Wind-driven ships can transport enough opium to hook and maintain the addiction of an enormous number of people.

Another product that is less addictive, albeit far easier to quit than tobacco or opium, is caffeine. And Victorian-era British loved their tea, the vast majority of it imported from China by the British East India Company. Tea was so popular The Company was running out of gold and silver to trade for it. There was a massive trade imbalance between Britain and China.

British East India Company

During this time the British East India Company was occupying and colonizing India. The company raised a private army, significantly larger than the official British army. They also privatized colonization. The British noticed the Chinese had a particular fondness for opium, which the Indians happened to be especially good at producing.

Many of the innowiki innovators remain nameless. Even those we know are often not household names. We think that’s unfair. However, in this case, whoever dreamed up this strategy likely wishes to remain anonymous. Getting to the point, the British East India Company realized they could addict countless Chinese and trade inexpensive opium for tea, selling the tea to the British.

Unwilling to do the dirty work themselves they relied on an Indian man, Jamsetjee Jejeebhoy. Like countless drug dealers that came later, Jejeebhoy came from a poor family but desired riches. With more than a little help from the British East India Company, Jejeebhoy quickly transformed himself into a Victorian-era Pablo Escobar.

This strategy proved wildly successful. The volume of opium coming into China, and the commensurate opium addiction, skyrocketed. Over ten million Chinese were addicted to opium, doing whatever was necessary to procure the drug.

Opium Wars

In response, the Chinese decided to crack down on opium imports. Chinese government officials began destroying shipments of opium and the British responded by demanding payment for the destroyed cargo. The Chinese predictably told the British to piss off and blockaded non-Chinese ships which too often carried opium. In response, the British sent a combination of government soldiers and East India Company mercenaries to fight for payment. The resulting skirmish is the First Opium War.

Most of the fighting was naval. The Chinese were badly outgunned by the British, who had far better technology and more practice thanks to never-ending European wars. In 1842, China was defeated. They signed the Treaty of Nanking, ceding Hong Kong and other small islands to Britain. China was forced to open five ports to import opium and export tea.

The next year civil war broke out in China and a rival Emperor vowing to end the opium trade. He seized a British ship, Arrow, and jailed the crew. War erupted. In the heat of battle, the Chinese killed a French mercenary leaving the French livid. Soon, China was battling all of western Europe. They lost, again. In response, the British outright demanded the legalization of opium, reparations, and the right for missionaries to engage in cultural imperialism.

Epilogue

Like most drug dealers, Jejeebhoy eventually pivoted into a more legitimate business, selling cotton during the Napoleonic War. He also donated an enormous amount of wealth to charitable causes, a common pattern for criminals trying to gain legitimacy and respect after-the-fact.

Before the Opium Wars, the Chinese economy was arguably the largest in the world. However, the fighting, addiction, and terms of surrender proved a terrible burden. China suffered a severe economic setback for the next century.

Modern Management (Wedgwood)

Modern management, marketing, and high-end sales to ordinary people make pottery company Wedgwood a management innovator.

Pottery dates back to ancient times. Fragments of pottery in China date back 20,000 years. Since then, for the most part, wherever archeologists find people they also find pottery. Therefore, opening a pottery manufacturer, especially in the 1700s, intuitively seems like a terrible idea.

Josiah Wedgwood decided to try something different, creating a pottery business built on high-quality management techniques and top-tier customer service.

Built in 1769, the Etruria Works factory spanned 350 acres. Employees, managers, and Wedgwood – along with their families – lived and work at the site. The company focused on “ornamental pottery,” pieces meant more for display than use. Although advertised as Etruscan his pottery more typically appeared in a Grecian style. The factory utilized division of labor, assigning different workers to a single specialized task. This was unusual before the introduction of standardized parts and the assembly line.

Wedgwood created a high-end showroom in London with well-dressed and knowledgeable staff. Each piece of pottery was beautifully showcased and packaged. Customers who changed their mind later could return a piece for full credit.

The quality of Wedgwood pottery was above average potters, but the company really differentiated by the highest quality purchase experience. They were also apt technology innovators, creating stoneware called Jasper. Like most English potters, they also manufactured local bone china.

More importantly, Wedgwood innovated modern marketing techniques, going so far that he obtained royal permission to brand a line of his pottery “Queen’s Ware.”

Wedgwood is the first known use of artificial scarcity, making his pottery attractive for collectors and investors.

The company

Computer Game

Background

Early computers used punch cards to load programs and data into computers. The software was a stack of cards, each card one line of a program. Data input were cards on the top of the stack. Eventually, then the entire thing fed into a card reader. The reader read the stack, processed the data, then printed results.

This process left the computer idle for a large amount of time since the computer did little to nothing while reading the stack of cards.

Computers in the 1950s and 1960s were extremely expensive. However, even with the lag-time and cost, using the computer was vastly faster, and thus less expensive than doing computations by hand. Therefore, companies and governments did not especially mind: the reduction in cost, even with the waiting, was still enormous.

However, this model did not work well for University’s, where many students shared a computer and needed to wait in line to try running their programs. In response, researchers created a new type of operating system, a timesharing operating system, allowing multiple people to use a computer at the same time.

As a side effect, these timesharing operating systems enabled input and output to terminals rather than through punch-cards and printouts. That is, the computer could read keyboard inputs from multiple people, sharing the time required to focus on each, and also run programs.

One side effect to timesharing is that computers became interactive. People could do something, then the computer could respond, then the user could do something else based on the response. This was a dramatically different use for computers which, until that time, functioned more like powerful calculators.

Spacewar!

In 1962, using an interactive DEC computer with circular monitors, Steve Russell created the first modern interactive computer videogame, Spacewar! Two players flew around in ships, with a star in the middle, trying to blast one another. The ships obeyed the laws of physics. The and the sun acted like a gravity well and would destroy ships. Earlier experimental interactive games were dull: tic-tac-toe and mazes.

Computing legend Alan Kay, the inventor of object-oriented programing and the laptop among other things, remarked: “the game of Spacewar blossoms spontaneously wherever there is a graphics display connected to a computer.”

Eventually, Nolan Bushnell and Ted Dabney created a coin-operated knockoff, Computer Space. That game did well and the two went on to create the first computer gaming company, Atari.

Social Network

When they’re not rigging elections, sowing discord, or amplifying hate social networks are a fun, simple, and convenient way to stay in touch. However, they suffer serious privacy issues under current implementations.

Electronic social networks, in various forms, are older than Facebook co-founder Mark Zuckerberg.

The first online bulletin-board enabling people to chat and hang out virtually was created by David Wooley and Doug Brown in 1973 on the PLATO system. Subsequently, Usenet, a similar bulletin-board system that ran primarily on email via the internet, dates to 1979. Afterwards, online communities sprang up on private bulletin-board system in future years. America Online, CompuServe, and The Well all had some form of social networking.

The most notable modern implementation is Friendster, founded in 2002. At one point it had 115 million active users and sold for $39.5 million. However, it eventually botched a strategic pivot to a gaming site and died in June 2015. Eventually, MySpace blasted on the web in 2003, eclipsing Friendster. Rupert Murdoch’s News Corp purchased it for $508 million in July 2005. However, thanks to infamous internal political fihghts, they ran it into the ground and sold it for $35 million in June 2011.

As of 2019, there are a countless number of social networks. Unquestionably, the current reigning champ of social networking is Facebook. Founded by Mark Zuckerberg and Eduardo Saverin in 2004, Facebook boasts over two billion active users and is on-track to recognize about $69 billion in 2019 revenue. Facebook also owns social media darling Instagram, which is especially popular with young people, and communication tool WhatsApp that they paid $21.8 billion for, or $55 per user.

Digital Video Recorder (DVR)

Digital Video Recorders (DVR’s) record digitally, to disk or flash memory, rather than analog recording to tape. This allows end-users to quickly fast-forward, rewind, and jump to a section of a recording rather than slowly searching.

Tivo and ReplayTV both launched DVR’s at the 1999 Consumer Electronics Show. As they did with videotapes, broadcasters and content owners reviled the new technology.

At first, ReplayTV contained more features, an ability to skip commercials with the click of one button and “share” content with other players. Subsequently, litigation shut those down.

However, commercial-skipping has since become a common use of DVR’s and content makers reworked their monetization strategy to focus less on mandatory commercial breaks. Presently, many content producers sell shows to commercial-free networks, including HBO, Netflix, and Amazon. Others place commercials on-screen or for use as props in shows.

Tivo was initially more successful despite high prices and a reputation for abysmal customer service. Eventually, neither DVR maker did especially well. ReplayTV shut down in 2011 and TV guide company Rovi purchased Tivo in 2016. “Tivo, which still exists, just got bought for $1.1 billion,” read a headline at the time.

Cable companies introduced DVR functionality in their own cable set-top boxes that they own, install, and rent. However, the rise in video streaming is quickly eliminating the need for a cable box.