The secret about secrets: Why you don’t want to keep them

Posted by Jon Peddie, President, Jon Peddie Research

Analyst Opinion - Imagine if you went to a car dealer and said, “What kind of an engine is in that RoadBlastor X500?“ And the car dealer said, “We don’t disclose the engine in our cars?” Or how about if you went to the local white goods store and said, “What is the horsepower of the motor in that Freezeyourstuff Z2000 refrigerator?” And you got a similar answer? I don’t know about you but my first reaction would be, “Oh, not too proud of it, huh? Got a bad Consumer’s Report?”So what about cellphones?

If you go to BestAIB Co, and ask them what GPU is on that board, the folks at Best AIB Co will tell you, happily and proudly. If you inquire about the memory, what kind how much and who built it, BestAIB Co people will almost spill their coffee showing you the specifications. Why? Because they are proud of their product and all the parts of it that go into making it a great machine.

Now go to your favorite mobile phone supplier and ask “What chips are in the HeatsYourPocket 105?” Most  likely they will tell you that they won’t discuss the components in their phones. Or ask your favorite set-top box (STB) supplier. Many of the STB suppliers will not reveal any technical details of their products.

Why is that? Well, they sell on price and not performance or features.

When STB suppliers build a box, they go for the cheapest parts they can buy, the ones that will just meet the specifications of a standard, like MPEG4 or HDMI. They typically don’t add anything that will enhance it, since there is a common belief that Joe Consumer doesn’t care and isn’t able to understand what macro block degeneration and line doubling are about – as long as the screen lights up and he can see the show guide. This is why especially STB and mobile phone companies use pretty much the same components and simply differentiate themselves through the skins of the product, perhaps the UI and price.

For a technologist and wannabe-ubergeek that is not very satisfying and, quite frankly, I avoid those products. I buy on specs and vendor’s pride. The prouder and more open and engaging a vendor is, the faster he will get my money, and more of it. But I’m not Joe Consumer, and Joe Consumer out numbers me 1,000,00:1, doesn’t he?

Well it turns out he doesn’t. Today’s consumer is smart, pretty well educated, has grown up with technology, likes it, understands it - typically better than the suits that are selling it. And the average consumer isn’t going to be satisfied with a blow-off answer, no matter how low the price is. If I’m going to plunk down my hard earned money (Ok, maybe I don’t work that hard) I want to know what it is that I’m buying.

So if you’ve got a secret, keep it. Keep your product as well, because I’m not interested.

Dr. Jon Peddie is the founder of multimedia market research firm Jon Peddie Research .