
Pump manufacturer programs their devices to fail prematurely and lowers price - bkraz
http://www.xavitech.com/setting-prices-suit-service-life-want-pumps/
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daxelrod
What's fascinating is that they're being upfront with their customers about
this, rather than trying to sneak it in. They're also explicitly letting their
customers decide how long the pumps should last, and pricing accordingly.

I wonder if other existing DRM-like mechanisms for hardware would be better
received if their manufacturers took this strategy.

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greenyoda
Selling exactly the same hardware with different prices and performance is
actually a pretty old practice. I've read stories of people long ago buying
hardware upgrades for IBM mainframes and being surprised when the IBM engineer
just came over and cut a wire on the backplane. "OK, you have twice as much
memory now. Have a nice day!"

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teh_klev
A pal of mine told me about a make of car (could've been the Fiat 128 or the
VW Polo - circa mid to late 80's) that had a small analogue clock as an
optional extra.

Apparently it was always factory fitted into the dashboard. If you didn't
order the clock, or whatever option pack that included the clock, the
manufacturer just put a blanking plate over the clock face and (I think)
disconnected the power (my memory is vague on this). He claimed to have
discovered this on one of his, or his mother's cars, when curiosity got the
better of him as to what was behind one of these accessory blanking plates.

This may have been a shaggy dog story though.

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moonka
I have a Mazda 3, which didn't have the fuel computer display (shows you
remaining mileage, current mpg etc). After I bought it I found out that by
doing a little dance with the buttons and turning it on and off I could enable
it. Now the only difference is that mine has a blank button to cycle through
it rather than one that says "Fuel Comp".

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wmoser
I'm not quite sure how I feel about this. Mechanical equipment lifespan
normally follows a well curve. Premature failures from manufacturing defects
and improper component installation or commissioning taper off to a period
where there is relatively low failure rates with proper maintenance until a
certain point where equipment fails from age (fatigue, worn parts etc). If the
end user is the one to specify the component, this could be great, you're not
paying for unused time at the end of the components life. Some components are
going to be replaced on a time schedule regardless of if there is usable life
in it or not, some things are better to do on your schedule than a broken
components. There is a warranty on the component for the full life of the pump
so if you're doing the spacing you can be reasonably assured it will last its
required life span or replaced. On the other hand, if I purchase a piece of
equipment from a different company and expect it to last N years, but they are
using this component to save money and only opt for it to last M years, and
don't disclose the life span, I could end up paying for N-M years of expected
service that I don't get to use. As an aside of other software limited
hardware, Caterpillar c-series Diesel engines are software limited to a
certain extent. If you need more horsepower call the service tech and they can
increase the HP. Disclaimer: I heard this from another marine engineer so
don't know if they need to upgrade other components as well or if it's
completely a software de-rating.

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narrowingorbits
Sounds like a market for an aftermarket service company to reprogram the pumps
not to break!

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ratfacemcgee
it'll take 15 minutes for someone to figure this out. then we'll have 0 day
warez for pumps.

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TodPunk
This would logically mean they can make their pumps really cheaply and long-
lasting, or they wouldn't have the markup to be able to do this. I'm not sure
how I feel about their position, but I know I'm less comfortable about how
this feels like "licensing" a product than I am about the markup they're
admitting to making in the first place.

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noahbarr
Synthetic, premature obsoleteness for pure economic gain is an engineering
insult & represents environmental malice.

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ianstallings
How do you know this wasn't requested by their customers?

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maxerickson
That's irrelevant to the point about environmental malice.

The pumps provide a value, which you are pointing out the manufacturer can
capture more of by offering artificially limited pumps at lower prices.

GP poster is pointing out that the pumps have a cost to the environment and
that the artificially limited pumps provide less offsetting value for this
imposed cost.

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iamjdg
So they are basically renting their pumps? When the pumps fail, they must get
them back and resell them to another customer. Else the economics would not
make sense. Unless they send less to build a shorter life pump, but my
impression was no, they program it to fail after a certain number of operating
hours.

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tonyarkles
The economics make perfect sense. Imagine you have a pump that lasts 1,000
hours, and it costs $10 to build. You have a reputation for making great
pumps.

To recoup your R&D costs and make a profit, you decide that you're going to
sell these pumps for $100. Those in the market for a 1,000 hour pump think
that's a fair price, but those who only need a 100 hour pump think that that's
outrageously expensive.

If you bring the price down to make the 100 hour pump people happy, you're
cutting into your margins for the 1,000 hour people. So you segment your
market: $100 for a 1,000 hour pump, $40 for a 100 hour pump. Your 1,000
customers continue buying the pump at the price they've always been paying,
and some of the 100 hour people start buying at $40. That incremental revenue
is all gravy; you didn't have to sink R&D money into a second product (other
than building the DRM)

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iamjdg
thanks. yes you are right. it is market segmentation. you move more units for
a lower weighted average margin. just seems silly your actually modify the
product to make it fail early just because someone paid less for it. i get it
for software, you leave features off or put them on and charge less or more.
but for an actual physical product, you are playing with operating hours as a
feature, just seems new to me. if i was to do it, i would put some money into
picking cheaper parts for the lower lifetime pump. then i could perhaps build
it for $7 and get more margin for these sales. but i guess it depends on how
much money you put into integrating cheaper parts. but even making it fail
early by programming cost some money.

~~~
tonyarkles
I agree, it's totally weird. I've been thinking about it ever since I saw the
article, and thinking about other pieces of equipment that I have that operate
on a similar model.

I've got an oscilloscope that I bought as a 50MHz model, knowing that an
upgrade to 100MHz could be purchased after the fact. When I bought it, I
didn't need the extra bandwidth and it was a decent price. Recently, I started
to need the extra bandwidth so I inquired about the upgrade cost. $300. To do
the upgrade, they give you a file that you stick on a USB key.

Part of me is grumpy about the fact that the equipment I bought was actually
capable of 100MHz out of the box and was just software locked. And part of me
is happy that I got to hold on to my extra $300 until I had a compelling
reason (read: a client was paying) to do the upgrade.

$X was a decent price for a 50MHz scope, and $X + $300 is a decent price for a
100MHz scope.

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JoeAltmaier
Bought a dot-matrix printer years ag, the cheap one, without double-wide
character support nor lower-case (just the capital letters). It arrived.
Inside was a jumper block. Reversed it - now it had all the features!

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ianstallings
Interesting how a lot of comments here attribute some inherent evilness to the
manufacturer, when more likely it's customer-driven feature that they've been
asking for or their sales staff saw the need for. If customers don't want or
need it, it won't be profitable. So you have nothing to worry about.

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HeyLaughingBoy
Lovely. So now software defects can _directly_ affect product lifetime. Just
the thing I need for something that has to live in the field for 15 years.

Well at least I know one more company whose products I should avoid.

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toomuchtodo
Or patron them, and sell a mod to override their premature obsolescence.

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crucini
This kind of offends us as technologists, but it may be the wave of the
future. I think business would generally prefer to buy a "defined benefit"
rather than gamble on the longevity of a device.

