Ford and the Radio
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From: Peter Langston <psl>
Date: Thu, 4 Feb 99 15:47:46 -0800
Subject: Ford and the Radio
From: George Towner
The other day a nontechie friend asked me to explain what the Microsoft
trial was about. He liked my analogy, so I am herewith sharing it out, with
apologies for certain historical liberties.
FORD AND THE RADIO -- A PARABLE
It is the 1920s, and Henry Ford has achieved his dream of building 95% of
the cars sold in America. "My car is for everyone," he declares, "and you
can get it in any color as long as it's black."
Along comes radio (the Next Big Thing of the 20s), and a small company named
Delco starts selling a receiver that you can fasten to the dashboard of
Ford's car. Intrigued, Ford makes a rival unit and sells it for the same
price as Delco's.
Sales languish because people prefer Delco's design. So Ford starts a price
war, eventually giving away his radio for free. Nevertheless, he still
controls less than 50% of the car radio market. So he goes to the car
dealers and tells them that if they install a Delco radio in one of his cars
he'll cancel their franchise.
This helps, but Ford discovers that car owners are secretly taking out his
radio and replacing it with Delco's. "By God, we'll stop that!" He rewires
his next model so that the ignition circuits run through his radio. Now if
you take it out the car won't start.
"Drivers were complaining that they had to reach two places on the dashboard
to start the car or tune the radio," explains a Ford spokesperson. "We've
integrated these functions in one convenient location. We call this
Innovation; it's what makes American great."
Meanwhile, Delco was losing money and has been swallowed up by another car
company. The new outfit is pushing the absurd idea of producing multiple
lines of cars for different tastes and varying budgets. And in colors, too.
Mr Ford is not amused.
© 1999 Peter Langston