A few weeks ago I had the opportunity to take in IT World’s 10 Things that Won’t Survive the Recession, and it made my head hurt so badly I can’t really explain. The bulk of the suggestions have a grain of truth about them, which is usually enough to gain them inclusion on lists like this, but let’s run down the list and explain how wrong – or right – the IT World editors are, shall we?
I’ll skip the ones where I think IT World is spot on, but focus in on the ones where I think there’s really something to say here. The whole rundown is under the jump.
1. Free tech support
IT World’s justification for this is that companies just won’t be able to afford paying humans to answer phones and deal with angry, time-consuming people when there are technologies like forums, wikis, chat programs, and other services that make it easier and faster for fewer technical employees to deal with increasingly large customer-bases. There’s some logic here, and a number of shops have already started trending to paid tech support or at least self-service technical support assisted by company staff, but I don’t think free tech support is going to outright die here.
For example, if you have a problem with your Comcast cable service, you can post to them using Twitter and get a pretty rapid and well-informed response, and if you’re playing Blizzard’s World of Warcraft, you can get help from a moderator by posting your problems to the technical support forum where other players can lend a hand, commiserate, or you can wait patiently for a response from a forum moderator. This trend will likely continue, but the only people who will take to this trend are companies that are already cash constrained, small, or technology companies (like motherboard and other component manufacturers) who can promise faster and more personal support by posting to a forum.
What the IT World staff neglect to note here is that organizations that have a responsibility to provide technical support to their users or customers will never get out from under providing free technical support when warranties come into play, for users who don’t have internet access (Comcast support via Twitter isn’t going to be useful when you can’t get online, or Dell forums won’t help when your Dell computer is busted), or for non-technical users who don’t feel like they should have to register for a forum and provide even more personal information to a company in order to get help with their DVD player, for example.
The other problem is that the burden will then fall on corporate IT, university/school/office IT organizations, where IT support and systems are often viewed as a revenue drain on the company and IT has to continually deliver high levels of performance and service in order to justify increasing IT expenditures. What happens when tech support is harder to come by in the business world but your school’s IT help line has to stay open longer in order to provide higher quality service to their users? That’s right – you get support calls for non-company or non-school services and equipment, which are usually framed up as “hey, I know you guys don’t support this” or “hey, can I ask you about my personal computer?” where the technician can say no and risk giving the department a bad rap or listen on to see if they can walk the line of helping without getting too engaged. Free tech support will be out there for people to find – it’s just a matter of where users find it.
3. Landline phones
This one’s been around for years. Seriously, since 2000 at least. With the rise of cellular access came the immediate assertion that landline phones were going to quickly die. Don’t get me wrong, I’m among the cell-phone-only crowd; I don’t have a landline and I certainly don’t want one, but that being said, there are still too many misconceptions about cellular availability and access for people who still don’t look at their cell phones as a primary communication device to drop their land lines. Many people still labor under the notion that cellular lines are more prone to failure than landlines and are still unreliable in comparison to good old fashioned copper.
Most of all, there are still people who simply don’t trust cellular technology and don’t trust wireless companies to provide handsets and coverage that could even approximate the reliability of their landline phones, and older people who just don’t trust something so new with communication that can often be critical – like an emergency. While the IT World folks write this off as the “grandma” crowd, I think it’s larger than they think it is, and I think there are a number of people in it that certainly aren’t grandmas. There’s no arguing that the number of people with cell phones is rising rapidly both here in the US and around the world, and the fact that cellular networks are easier to build and maintain for telecomm companies than copper-to-the-home networks doesn’t help either. Still, copper telephone lines to the home will exist as long as fiber and cable to the home exist.
5. Web 2.0 companies without a business plan
Good luck with this one. This is a perfect example of an assertion that’s light on proof and heavy on “because the editors here want it to be true.” I don’t necessarily disagree, but they point to Twitter as one of these services. We’ve been hearing this for a long time as well – popular Web 2.0 services without a method to monetize their services will die off. Makes sense, and people worry about it frequently – especially with regard to micro-blogging like Twitter, which somehow (I don’t know how) manage to pay their hosting and bandwidth fees.
Then you look at services like Digg, which are essentially in the same boat, or YouTube, which was in the same boat until it got snapped up by Google. And that’s the crititcal point – Web services without a business plan will always exist, and if they get popular, they’ll be even bigger – but the best ideas, as they have in the past – won’t have a business plan behind them right out of the gate. We’ll see fewer of those services, sure, and we’ll certainly not see the frenzy of venture capital spending we have in the past several years, but take it from someone who covers these services – they’re still springing up by the dozens.
Perhaps what the recession will really bring is not the end of Web 2.0 companies without a business plan, but the evolution of Web 2.0 companies to focus on providing creative and ground-breaking services that are destined to become so popular they’ll inevitably be snapped up by a larger company with money to spend. We’ll see services like Twitter popping up with some of their own money to spend, maybe one round of venture capital, and by the time the money starts running out they’re already shopping themselves around to Google and the like.
6. Most companies in Silicon Valley
Their basis for this predication is purely a weak analogy to the auto industry and again, a “this is what SHOULD happen” kind of idea. This makes my head hurt. There’s no doubt the tech industry has been hit pretty hard by the economic downturn, but as an industry the tech sector has been hit much much more lightly than other market sectors. The economic bust won’t mean such drastic measures for the technology industry unless there’s a similar bust in tech spending and investment, and we haven’t seen it quite yet, even in shrinking companies. Right now, technology is being asked to share the burden of srhinking profits and revenues across the board, but technology has been a bit insular. Silicon Valley will shed some weight, without a doubt, but this kind of dramatic language only serves to exacerbate fears, not reflect them.
7. Palm Inc.
They’re so right here it’s not even funny. If Palm doesn’t release a new OS this month at CES, the clock is ticking on their either demise or their eventual spinning off of their cellular technology to an interested party. Seriously – they could make an Apple-style comeback if they do this right, but they have to actually do it first.
10. Satellite Radio
Not so much, and I have to wonder if as the list wore on, the editors were like “what would we like to see dead as a result of the recession” instead of thinking with their editorial heads. Entertainment spending is down without a doubt, but entertainment, like technology, is historically one of the most resilient market areas. I don’t think people will stop investing in satellite if their only options are commercial-laden, repetitive local radio. If anything kills Satellite Radio, it won’t be the recession, it’ll be the train wreck that is the Sirius/XM merger and how horribly it was handled. The new company won’t be for lack of revenue or lack of subscribers. It’ll likely reorganize and possibly shrink significantly, but it’ll survive – and who knows, maybe we’ll have something better.
The only thing that’ll kill Satellite Radio is the ability for anyone to all but ubiquitously play internet radio in their cars or store massive music collections in their cars. For the latter, think high-storage in-dash units that are affordable enough to come in your new model car, easily loaded up from your iPod or can rip CDs while you play them so you never have to bring the CD back, and then can be voice controlled a-la Microsoft’s Sync operating system for cars. Once people have large amounts of quality media they can browse and choose from in their vehicles, then we may see the end of satellite radio, and a return of radio to more grounded topics like news, traffic, talk, politics, events, and other generally non-music topics.
The items I didn’t touch were mostly solid, while I may have agreed for different reasons. I don’t think Yahoo! is going to make it through the recession and neither do the IT World editors, and I also think we’ll see a drastic decline in retail chains around the country – only the strongest and those with the most dedicated customer bases will survive. That being said, the IT World folks seem to like dramatic voice, which often makes their claims a little difficult to back up. Take even the good ones with a grain of salt and a little reality, and to the IT World editors I’d offer a couple of grains of humility to go with their big talk, even if I think they’re completely right on some fronts.