12 January 2010
This report on customer service problems Google is facing with its Nexus One phone is a case study on how success in one arena (software services) does not always translate well into another arena. Customer support is expensive. I remember reading cost studies of ISPs and telephone carriers in the 1990s that indicated that customer service accounts for 35-50% of total costs. What was memorable to me in those studies was that providing customer service was more expensive than operating the networks that the customers used! It seems that Google is learning this lesson now.
05 January 2010
I have been interested in standards rivalries for a long time, so this article over at Ars Technica caught my attention (see this search on HD-DVD vs Blu Ray, for example). There are more nuanced analyses of both the Betamax vs. VHS and HD-DVD vs. Blu Ray rivalries, but I think the most interesting contribution of the Ars Technica article is the prediction of a shift from hardware rivalries to content distribution rivalries as we move from hardware to software. I think they have an interesting point, one that the economic literature on standards has not addressed explicitly (to my knowledge).