I want to start off with a bit of an exercise. Who here has an iPhone? Any model? Please take it out of your pocket and hold it up like this.
Okay, if you’ve got an iPhone 5, please put it down.
So if I understand correctly, everyone with their hand in the air has a 4 or older, right?
I’m going to pick on some of you now. If you’ve got a 3GS or earlier, wave your hands around a bit.
Anyone feel embarrassed aside from the fact that I’ve just gotten you to wave your arms around frantically in front of a crowd of total strangers?
All right. So, 3GS owners, by my estimate, your phone is now around three years old. Ancient, by modern tech standards. Not the kind of thing you’d want to pull out at a party and show off to your friends.
How does that make you feel? Left out? A little obsolete? More than a little behind the times?
Don’t let it.
If there’s one thing you take from today’s discussion, it’s this: There is no such thing as obsolete.
At least not by current definitions. If you listen to “them”, something is obsolete almost as soon as its replacement device is released. Bought a third generation iPad – like mine – a few months ago? Aw, too bad, it’s now an old, forgettable piece of technology because the FOURTH generation iPad, with faster processor and Lightning connector, replaced it just last month.
I don’t buy into that notion and neither should you. My third generation iPad is just as useful to me today as it was the day before the fourth generation one hit store shelves. Sure, Apple WANTS me to believe that I have to reach back into my pocket, pull out my credit card and buy another newer, faster device to replace my suddenly older, slower one. But since when does Apple control my budget?
[The world today]
So we live in a world of iPhone 5s, iPad minis, Windows 8s...we live in an almost constant flow of shiny new gadgets, all competing for our attention - and our wallets. Still hanging on to your now-ancient BlackBerry? I know how it feels - because I’ve got a year-old BlackBerry that friends razz me about every time I pull it out of my pocket. It’s a YEAR OLD, yet somehow it’s gone from top of the heap to yesterday’s news in a blink.
If you’re like me and you’re not – at least according to “them” – using the latest and greatest technology, I understand why sometimes you feel like you need to keep it discretely tucked away when you're at a social gathering. Because if you don’t, you know your more tech-forward friends may needle you for carrying something so old and frumpy.
But do you REALLY have to buy the latest and greatest? Do you HAVE to spend ridiculous amounts of money, time, and energy to keep up with the technological Joneses? Do you have to wait in line every year to get the newest iPhone? Basically, no.
I’d like to share my radical new definition of the word “obsolete”:
Technology doesn't become obsolete because it gets old. It becomes obsolete only when it fails to meet your needs. [Repeat after me.]
[Old isn’t necessarily useless]
So if that 10-year-old, Windows XP PC is still chugging away and isn't causing you to pull your hair out in frustration, then it isn't necessarily obsolete. Which brings us to my first cardinal rule of technology: YOU define obsolescence by whether or not your technology still does the job for you. No one else can define it on your behalf.
Keep that in mind at the next party. And the keeners who laugh at your backdated device. Well, they have no idea what they’re talking about. They’re spend more time BUYING and TALKING ABOUT and COMPARING their devices – and congratulating themselves for being such tech visionaries – that they almost never actually USE the things they buy. I try to avoid going to them for advice, because I like to USE my stuff more than I talk about it (today excepted, of course.)
But staying away from the technology-as-fashion brigade isn’t always easy.
That’s because hardware and software vendors – like Apple, HP, and Google – don't make life easy on us. For example, you can't upgrade a first-generation iPad to the latest version of Apple's mobile operating system, iOS 6. Unfortunately, some new apps will ONLY run on iOS 6.
So if you use your iPad at work or at home, and you absolutely need to use an app that won't run on the old version of the operating system, you're stuck buying a new iPad. Sure, your old iPad was still ticking along no problem, but Apple kinda forced you to buy a new one by squeezing a perfectly good device off the back of the treadmill.
Likewise, lots of new software won't run on older versions of Windows. Or your old version of Microsoft Office – say, Office 2000 or 2003 – can no longer read files you get from clients because they’ve got Office 2010. The new Office uses a new file format, and your clients may have forgotten to save those Word documents and Excel spreadsheets in the old format.
Sometimes the problem is hardware – or rather, hardware that disappears. What happens if your old accounting software comes on a CD - and your new computer doesn't have an optical drive. Or what if someone gives you a flash drive with some files on it and your old machine can't read it?
Mac fans are challenged, too, as newer browsers and apps won't work on versions of Mac OS X that are only a couple of years old. My wife’s computer now pops up a message to her Every Time She Opens It Up. This browser will no longer be updated, because you’re using Microsoft OS X version 10.5.
The computer is THREE years old! And if I don’t fork over for an upgrade, I’ll be reading this ridiculous message forever.
Sometimes, the problem is a little simpler than that: just try buying a protective case or a replacement adapter for that two-year-old phone. More often than not, you'll come up empty. So even if the machine still meets YOUR needs, your profit-seeking vendor may force you into buying something new sooner than you would have liked.
[Need a strategy]
We need a strategy. We can't buy every new device as it's introduced, because not even Bill Gates has that kind of money. But, we can't hold onto our technology for too long, because eventually the world around us will change, and we'll be stuck, like orphans. The key is balance. I like to think of my strategy in terms of time-based windows.
When you buy a laptop, for example, you're not buying the hardware as much as you're buying a three-year period of use. Get three years of good, reliable use out of it, then feel no guilt when you cascade the machine to your child or donate it to a worthy local charity. After three years, keeping your machine fresh may take more time and energy than you've got because like it or not, technology moves fast and the older a device gets, the harder it’ll be to keep it current and usable.
That window may vary: if you're using your PC to send the occasional email and surf the web a bit, you may be looking at 4 or 5 years. Or even more if you’re really lucky. Use that machine heavily every day to support your business and that window could shrink to 2 years or less. There is no one perfect time for everyone. Your mileage may vary depending on who you are and how you plan on using it.
Mobile phones are the same thing. Since most of them are sold as part of three-year contracts, you can easily get a new one for the same $50 or $100 subsidized rate - or, if you're really lucky, for nothing - when you renew your contract in three years.
That approach works for my mother, whose contract ran out last year and she's still holding onto her ancient flip phone. But since she keeps it stashed in her glove compartment for emergencies only, and only checks it every month or so to make sure it still works, she doesn't need an upgrade. She's also become comfortable with her delightfully brain-dead old phone, and moving to something newer might be difficult for her.
I’m a bit of a different story. My smartphones, thanks to heavy daily, business-related use, barely last for two years. I've built the upgrade fee into my business plan, because for me, if my phone dies and I lose work because of it, the dollar figure will be a lot more than what it would have cost me to upgrade to the newest phone after a couple of years.
[The dreaded subsidy]
Keep something in mind, though: That sparkly new smartphone – iPhone 5, Galaxy III S or even a BlackBerry Bold – that you get for $200 or $100 or even for free when you sign up for a contract? It doesn’t actually COST $200. Or $100. And it certainly isn’t free. It’s actually worth a lot more, usually closer to $600, $700 or, in the case of some of the newer giant-screened Android phones, $800. Think about it for a second: your smartphone is actually more valuable than the average laptop.
Why does any of this matter?
Because the difference between what you PAY for the phone when you sign up for your contract and walk out of the store, and what it’s actually WORTH is what’s known as a subsidy. And please don’t ever think that your wireless carrier is going to give you that big a discount on anything. The way it works is they’ll make sure you pay back the difference, bit by bit, over the 2- or, more typically, 3-year length of your contract.
All well and good, right? Sure, until you decide a year from now that your iPhone 5 is no longer good enough because the iPhone 6 includes a holographic screen, 5G wireless, an empathic version of Siri and possibly even an ear wax remover. What happens when you try to upgrade your phone after a year? Well, you’ll have to pay what you still owe on the phone. Like hundreds of dollars.
Lose the phone? Break it? Get it chewed to bits and pieces by a particularly tech-loving dog? If it happens early in your contract, you’re going to pay. Through the nose.
If you’re the kind of person who every year or so absolutely MUST have the latest smartphone, carriers are going to love you. Because those billions of dollars in profit they make? A nice chunk of it comes from people like you. Because they play the math to their advantage.
Which brings me to the concept of technology-as-style, and whether or not you want to buy into it.
Despite what the tech companies would like us to believe, technology is a need thing, not a fashion thing. Yes, it's sexy to be the first among your friends to pull out an iPhone 5 at a party, and I admit it's a lot of fun to be the center of attention. But getting to that position can be expensive. And what really matters is whether you really need that iPhone 5 to get stuff - personal or professional - done, or whether your old iPhone 4S, 4 or, gasp, even a 3GS will still fit the bill.
For some people, depending on how they use their phones, the answer may be to sit tight and wait. Before you pull out the Best Buy flyer, hit the web or walk into a store, assess why you have this stuff in the first place and be honest with yourself about how well - or not - it's meeting your needs, and how you think that might change over the next number of months and years.
Alternatively, give some thought to not buying the latest and greatest every time you get a phone. If your needs are basic, you can still buy an iPhone 4S, or even a 4, when you first sign up for a contract. You might save a couple of hundred bucks up front, though you’ll be a little less popular at parties. Only you can decide whether the tradeoff is worth it, based entirely on how you think you’re going to be using the phone over its projected lifetime.
[You need a plan]
Which brings us to our next lesson: you need a plan every time you buy something. And you can't simply buy it and forget it. You have to regularly re-evaluate your needs to ensure your stuff still meets them.
If it makes you feel any better, I have to go through the exact same process.
That shiny laptop I bought last year? Well, it's a little less shiny now that I've been hammering away at it for a year. And the upgraded software I've had to install now takes up more memory and makes it run slower. I COULD buy Apple's latest retina-screen MacBook Pro. I could also eat ramen noodles for a month because I'd be dropping $3,000 on a machine barely a year after I spent a then-princely $1,500 on what I thought was a three-year purchase.
The alternative? A memory upgrade that'll cost me under $100 and give me zippy performance for the next couple of years. Problem solved.
My phone? Same thing. I know I'm hard on my phones, and I bought my BlackBerry just over a year ago. I get a lot of ribbing from iPhone 5-toting friends, but so far, my BlackBerry - a Bold 9900, by the way - has been a great workhorse for the kind of work I do. No need to do anything to it for another year, though I'm already starting to size up what might be available a year from now, because research is always a good thing. Would I like to have it last 3 years? Sure, but that's never happened before (I wear them out long before then). So the extra $150 or so that it'll cost me to upgrade in a year – that subsidy still needs to be paid off, remember? – is a fair price – FOR ME – to pay for business utility. Would that be a different case for you? Maybe: but you’ll only know if you take the time to consider your options.
But what if you just want to use the thing till it dies? The longer you stretch a given technology, the greater the risk of some really bad stuff happening to it. Stuff like:
1. An expensive repair bill - there's no such thing as a cheap fix in tech anymore. For example, replacing the screen on a 5-year-old laptop will easily cost more than an entirely new machine. What if it’s a seemingly small repair, like your USB ports no longer working? Well, there’s a problem there, too.
Because the way computers are built today, you can’t simply have the USB ports replaced. The electronics are so highly integrated that generally the only repair option is to replace the system board. It’s like needing to replace the entire engine on your car when you really only needed a new dipstick: well, too bad…because you can’t GET just a simple dipstick anymore. It’s all or nothing.
2. It simply conking out right before a big deadline - electronic devices rarely warn you before they fail. They just die. And always at the worst possible time. [Quick show of hands, who’s had that happen to them?]
So you have to decide if you’re working on a huge project that’s worth half of your company’s annual revenue and it needs to be delivered tomorrow morning by 9 o’clock or you lose it all. Can you afford for your most important piece of technology to conk out on you at the worst possible time?
We often think of computers in terms of what they cost to buy or what they cost to repair – remember this? “I paid $3,000 for it three years ago, so I want to get my money’s worth.” Well, what’s the WORK that you actually DO with the machine worth to you? I’ll bet for many of us, the value of the work done far exceeds the cost of springing for a new machine every few years.
3. Software incompatibility - old machines with old operating systems may not be able to run the latest software. If you stick with your older software, you may not be able to exchange files or collaborate with friends, clients or colleagues. I know what you’re saying: I don’t exchange all that many files with anyone, and the software I have – say Microsoft Office 2003 – works just fine and I haven’t had to update it in years.
Okay, that may work for some of us. But increasingly, software doesn’t come in a box. It’s downloaded, or pre-installed, or you get at it over the web, inside your browser – like Gmail or WordPress. So we can no longer just freeze our software in time by simply not updating it. Instead, it gets updated for us. Automatically. And when it gets updated, it gets bigger and more complex. Which slows our once very fast machines down. And sometimes requires other updates – like newer, better browsers. Eventually, that’s going to bring our once-blazing fast PCs to a screaming halt whether we like it or not.
4. Security - Older operating systems aren't as secure as newer ones. A malware, virus or trojan infection could destroy your machine and infect others. I know what you’re thinking: “But I don’t download software or do any of the other DANGEROUS activities that lead to infection.” I don’t want to sound like I’m telling you so, but I’m going to tell you so, anyway: we’re ALL vulnerable. Just the very act of going online and visiting a website can result in your computer being infected by something really bad.
A couple of years back, a computer security company did an experiment. They took a brand new computer out of the box and set it up WITHOUT any kind of security software on it. They hooked it up to the Internet and let it run. They didn’t actually USE it…they just let it sit there. It took 14 minutes to be attacked. Within an hour, system performance was noticeably reduced. Within 48 hours the machine was unusable, so infected that it had become the technological equivalent of a nuclear waste dump.
So how do WE notice when our security’s been compromised? Our machines begin to slow down, we start to see funny messages when we visit websites, with things popping up onscreen when we least expect them.
The lesson? An older machine is far more vulnerable to being hacked – just by being in use – than a newer machine that has a more modern, more secure operating system and related software. Older machines probably don’t get their security software updated regularly either, which further widens their window of vulnerability.
5. Productivity challenges - All those hiccups and moments where the machine just "hangs" can add up. Your technology should be a tool that works, not one that causes you to sit for seconds, minutes or hours waiting for it to unfreeze. You'd be amazed at how much more work you can get done, in less time, on a new machine That Just Works.
If all you’re doing is dashing off a couple of email messages a day, maybe it’s little more than a tolerable annoyance for you. But if you’re using the machine for anything more involved, eventually you’re looking at serious time being wasted. And if you work from home, all that time is now costing you.
Now that we’ve looked at the pitfalls, let’s look at the opportunity. Keeping current technology relevant for longer periods of time CAN be done. Cost effective upgrades and tweaks can maximize productivity while minimizing expense. Of course all of this comes with a caveat – TO A POINT – but don’t feel like you’re powerless. There’s lots of things you can try, like:
· Memory upgrades. As software is updated, it typically gets bigger and bigger, placing a heavier load on yesterday's technology. More memory in a laptop could return it to its zippy former self. It's a cheap fix, and it's often a do-it-yourself job. Or, if you're afraid to dive in, bake a batch of brownies and call your tech-savvy teenaged niece.
· Software tuning. Operating systems get bogged down over time. Delete unneeded apps, clear your history and cache every once in a while, and if you're really ambitious, reinstall your operating system entirely every six months or so. Just be sure to back up your data. And call your niece.
· Cost justify everything. Before you buy that tablet, ask yourself what you'll be using it for, and whether another piece of technology you already own can meet that need. Often, you'll find it's a want and not a need. If you can't quantify the bottom line benefit of buying something new, think twice before you pull out your credit card.
· Think in terms of generations. Avoid the temptation to buy a new smartphone or tablet every year. As we’ve seen today, that can get really expensive really quickly. Instead, plan to upgrade in two or three generations (years). That keeps your devices relatively current, and helps you avoid punishing fees for terminations and upgrades. If you upgrade at the two-year mark, for example, the financial punishment will be far less than if you insist on buying something shiny and new every year. If you’ve got a large enough family or business to carry multiple phones, you might be able to buy new on a regular basis, then cascade the older devices to others.
· Know when to end it. Eventually, all technology gets old and must be replaced. Just because you spent $2,000 on that desktop PC 10 years ago does not make it worth fixing today. Retail price and overall performance are often less connected than you'd think.
I want to pay special attention to smartphones for a bit, because they’ve quietly become the most expensive pieces of technology we own. Think about it for a second. They may cost us under a couple of hundred dollars when we first buy them – pocket change, really, compared to a thousand-dollar laptop. But think about lifecycle costs. Every month, you’ll be paying, on average according to Canadian industry statistics, about $60 for voice and data service. If we’re being conservative, that’s between $2,500 and $3,000 over the course of a three-year contract once taxes and fees are factored in. Add in heavy use, overage charges and other factors and without too much difficulty, that little smartphone can blow through $4,000 or even $5,000 over the life of the contract.
So I’ve got a few ways to save here, too.
1. Plan your contract. When you buy a new phone, for example, make sure you ask about early termination or upgrade fees. Consider buying an unlocked phone - non-subsidized, as that way you're not locked into a long-term contract and can shop around for the best rate plan deal.
Canadian carriers haven’t traditionally given customers much of a break on rate plans because they had their own unlocked phones. But that’s, slowly, beginning to change. You wouldn’t buy a car without doing your homework, and the same kid of logic applies to contract planning. Know all costs well in advance so you can plan accordingly.
2. Negotiate: Finding the perfect rate plan is exactly the same as buying a new car: The price you first see isn't the price you'll ultimately pay, and that final number really depends on how strong a negotiator you are. Nothing is carved in stone, and nothing stops you from asking for either a lower bill, more services, or both.
Also, just because you're locked into a two- or three-year contract doesn't mean that the terms of that contract can't be changed mid-stream. They can, and you're free to call the toll-free customer support line and ask for more at any point within your contract period. Carriers won't sweeten the deal voluntarily, however, and they certainly won't be calling you: It's up to you to challenge them. Make the call and you may be pleasantly surprised at the result.
3. Study your bill. Don't just pay your monthly bill. Study it. Look for anything that seems odd or out of place. Carriers count on consumers who don't pay attention to their bills. Don't let them. Challenge them to explain themselves when mysterious-looking line items show up unannounced.
And rest assured those mysterious items WILL show up, quietly, on your bill. And if you do and say nothing, you’ll be stuck paying for them.
4. Get everything in writing. So often, I hear stories of folks getting their monthly invoice and freaking out because something the salesperson in the store or company rep on the phone promised them wasn’t there. My advice: make sure they write it down. Because, like the car salesperson who promises something while you’re negotiating the deal, if it isn’t written down somewhere, it’ll surely be forgotten down the line.
I don’t mean to imply anyone would be deliberately dishonest, of course, but smart consumers cover all bases. Cover this one by having in-store sales reps show you WHERE in the contract that particular commitment can be found. If you’re on the phone, take notes, and have them email you a summary of the features and prices you selected once the call is done.
5. Don’t multiply your bills. Not so long ago, your cell phone or smartphone was the only piece of electronics you owned that came with a monthly bill. No more. Now, you can easily buy 3G or 4G-capable tablets, laptops, and USB rocket sticks. More and more cars come with built-in Internet connectivity, as well. And every one of them comes with a bill.
Ask yourself if you really need to have 4G on BOTH your smartphone AND your tablet. Or can you buy a WiFi-only tablet, then use tethering to share your smartphone’s data plan? Of course, you’ll want to make sure your data plan is big enough to support more devices, and you’ll want to talk to your carrier about ensuring they don’t charge extra for the privilege of tethering.
In the past, some have, but they’re starting to back away from charging for tethering because they realize they’re just being greedy. But you won’t know unless you ask. So ask.
6. Track usage. All carriers provide online tools to measure voice and data usage through the month. Find out where they are and use them regularly. Look for areas where you're perhaps not making use of services that you're paying for. For example, if you're paying an extra $20 for unlimited long distance, but only used 8 minutes of it for six months running, perhaps it's time to remove that unnecessary feature from your account.
Similarly, if you're paying a premium for data usage for you've never used more than 200 Mb in a month, call your carrier and make the change. If you never call, you’ll never know – and carriers will be only too happy to take your money, month after month, for stuff you have no intention of ever using. Be a proactive customer and don’t let them get away with it.
Whether we like it or not, we’re all customers in this crazy tech market. At some point, all of us need to have at least SOME of these devices in order to live reasonably well in the modern world. The great thing about living in 2012 is that we have an incredible amount of choice, and those choices keep getting better virtually with each passing day.
That pace can be a little overwhelming, though, and it can lead to us feeling the need to keep up with the Joneses, or otherwise buy stuff – expensive stuff – we don’t really need. Unfortunately for us, we don’t have the power to slow down the pace of technological evolution. If anything, it'll only accelerate in the months and years to come. And if you’re the type of person who buys on style without necessarily doing your homework, you’re in for a very expensive few months and years, indeed.
But we DO have the power to do our homework and make smarter, more timely purchases. With a methodical plan and a willingness to explore alternatives, you can avoid the urge to buy the latest and greatest.
Start with your needs, go in asking a lot of questions, stick to the long-term view and you'll avoid the expensive constant-tech-upgrade treadmill altogether. There’s no guarantee you won’t end up with an iPhone 5 or the latest touchscreen-enabled Windows 8 hybrid laptop, but at the very least it’ll be based on a rational assessment of your real needs, and not an irrational desire to simply have something new and shiny.
That research will come in handy throughout the life of the device, as well, as you’ll be better equipped to know when to upgrade, when to hold onto it, and when to throw in the towel and head to the store for a replacement.
At the end of the day, I think you’ll all agree that technology is a heck of a lot of fun to follow and use, and the way it’s transformed our lives is nothing short of miraculous. We just don’t want to go broke in the process.
Hang on, though. We’re not done yet. You didn’t think you’d get out of here without doing a little work, did you?
I want you to look to your left and look to your right. Pair off in groups of two, three or even four – whatever makes the most sense for you.
I want you to talk about the ONE thing you’re going to do THIS WEEK to save money on technology. We’ll give it a few minutes and then pass a mic around the room.
If you’re a Twitter fan, when you’re done, tweet your idea to the @WesternFair account, and be sure to include the #TES hashtag.
Go for it…
Original talking points from Andrew:
· Audience: general public with a heightened interest in new technology and how it can better their personal and business activity.
· Should they be worried if they don’t keep up with the latest trends eg. Do they buy an iPhone5 or keep the BB..does it even matter
· What consequences do you face if you do not keep up to date, how far behind can you get before you start to become a problem to others
· Cost effective ways to stay relevant to recent trends. How often/ How much should we spend on upgrades?
· Do we the customer have any power in slowing down the constant changes so we don’t have to reach in our wallets all the time? eg, new plugs on devices everytime they launch a new model