Clearly we know this . . . → Read More: Repricing in America]]> I’ve been bothered in the best possible way by a comment made by Richard Davis, President and Chief Executive Officer of U.S. Bancorp. In almost a throw away fashion Richard told an audience of business executives in Orange County California, that the economy is going through a process of “repricing ” downward.

Clearly we know this to be the case in the housing industry, as those of us with houses have seen about 25% or more of the assessed value of the house disappear.  As troublesome as this has been for many people, it has not stopped there.  Just look around and you’re seeing it in the automotive business, grocery stores, and restaurants offering significant discounts. In the labor market, those getting new jobs are doing so at often dramatically lower salaries.  Everything it seems is ratcheting down, finding a new market clearing level.

This deflation, or to be more positive, repricing, has consequences which favor highly efficient, low fixed overhead companies over those with large superstructures of bureaucracies.  As we’ve seen, some companies can relieve some pressure by laying off labor, but those companies (I’m thinking GM) with lots of large buildings and large fixed expenses, can’t adjust sufficiently and quickly enough.  For these large companies, it is exceptionally difficult to accommodate to downward price adjustments, hence they fail.

Companies which do succeed in these environments are new ones.  These companies benefit by being new and not around so long as to have large fixed expenses, these are the entrepreneurs.  The best way to grow our economy is for the US to have a brisk entrepreneurial bias in its policy decisions.   In this Economy, as serial entrepreneur Ken Forbes, CEO of AppointYou in Aliso Viejo, California told me, it is easier to create a job than get one.  This is the best time for the creative among us to leverage their comparative advantage of being lean, to get their products and services into the economy and make wonderful things happen for us all.

Thomas A. Coss

In 2008 over one trillion text messages were . . . → Read More: Texting and Everything Else You Do In Life]]> Last June, the Senate Judiciary Committee began hearings on texting. Included in the discussion were executives from AT&T, Verizon along with othere the focus of which was the nature of charging for text messages. Though the hearings were interesting, the real headline is in the data surrounding texting itself

In 2008 over one trillion text messages were sent in the US.  According to AT&T, texting grew from 2.4 billion in January of 2007 to over 31.1 billion in January of this year.  The direct costs per text were estimated at approximately three tenths of one cent each, with an average charge to the telephone subscriber of 1 cent per text message.  Approximately 420 text messages can fit the bandwith it takes to have a one  minute conversation.

Why is text messaging growing so much?  Well simply because it is efficient.  The text message forces the sendor to be succinct (you have only 160 characters in which to get your point across) and it can be very quickly consumed.  Over the weekend, by oldest daughter told me that she just heard a voice mail left by her sister 4 days ago.  This isn’t to say that she’s disengaged, just that voice mail is not the preferred mean of communication.  She went on to say that occassionally she’ll get text messages from her friends telling her to check her voice mail.  Texting is simple, succinct, fast, and it’s semi-perminant.  You can save a text message to refer to later on, not as easy in voicemail.

In a world in which information flows so effortlessly and at near zero cost, texting speaks more of the future than the past.  Who know that email would become “so yesterday” so soon.

Tom

According to a University of Pennsylvania study, the speed with which we consume information from our eyes to the visual cortex in the brain is approximately 10 megabytes per second, we hear at roughly one . . . → Read More: Texting and Efficiency – This is Just The Beginning]]> “This message of twenty four words and 138 total characters takes you less than five seconds to consume, that is why texting is popular.”

According to a University of Pennsylvania study, the speed with which we consume information from our eyes to the visual cortex in the brain is approximately 10 megabytes per second, we hear at roughly one tenth that speed or a rate of about 102 kilobytes per second. 

Just think how drastically communication has changed over the past 35 years.  The first email went out in 1971, still it would take nearly 30 years before email became pervasive in society.  In the mid 1990′s business still depended heavily upon voice mail, a slow and often annoying means of sharing information with colleagues in a time shifted manner.  The annoying part came when people, seeking to gain favor with superiors, would copy everyone on the message.  That copying continues today in email but in that there is hope.  

In December of 1992 the first text message was sent via SMS or Simple Messaging Services. During the second quarter of 2008, AT&T reported that more text messages were sent from cell phones than actual calls.  Texting is becoming a preferred means of communicating short messages from person to person. On June 9 of this year the US Senate held hearings from the major telephone operators in regard to pricing of texting services offered customers, and it is from those hearings that this story unfolds.

Though providers charge 20 cents per text when the individual has not chosen a texting plan, those people represent less than 1% of users.  The average price per text is around a penny.  The cost of providing that text is estimated to be about 0.0325 cents per text, providing the carriers with a very handsome gross margin of nearly 70%.  Still, what really matters is that texting is growing at a rate approaching 50% per month and that texting is seen as fast and efficient.

This past 4th of July weekend I spent some valuable time with my daughter (16) and five of her friends.  For a few minutes I was able to discuss with them their texting behavior, preferences and general insights into text messaging.  Texting, it turns out, has a lot of benefits besides being efficient or quick to consume.  It’s private for one, often more priviate than email, and it can be consumed discretely “even during church” according to one of the girls I interviewed. Texting has perseverence, it stays on ones handset and can be accessed at a later time.  This is an added value to texting not commonly considered and from a marketing perspective, holds great promise.

The point of all this is that texting is more than the electronic version of sending notes among young kids in high school.  Texting is important because it is succinct and so very quickly consumed.   Character length constrictions force a succinctness that is greatly needed in communication, while also improving upon the speed by which the message is consumed. That same message above could be re-written:

“This msg of 24 wds & 138 characters takes u less than 5 secs to consume, thats y txtng is popular”

This version is now down to 21 words and 95 characters, a character reduction of 32%, while still clearly conveying the same message, only instead of taking you 5 seconds to consume, you consumed it in about 3.  With the abundance of information thrown at us on a daily basis, anything that eases its consumption is good news indeed.

Suppose for a moment that you and I are in a business arrangement in which your responsibility is . . . → Read More: Healthcare Reform and the Coss Conundrum]]> There are a lot of hopes placed upon the role of healthcare IT to address the ills of the healthcare industry, some are legitimate, many are not.  One such limitation I call the Coss Conundrum which goes like this.

Suppose for a moment that you and I are in a business arrangement in which your responsibility is to beat me unmercifully about the head and shoulders with a stick; my responsibility is to provide you with a stick.  Just how big a stick would you expect?  If you’re thinking anything bigger than a standard yellow pencil, you’re likely to optimistic.

Here in lies the conundrum.  The stick, in this case, is healthcare provider information, and it is here where the government’s efforts run up against the pragmatics of broad based implementation.  Why would any private practicing physician pay money for an information system if, like the conundrum suggests, the practitioner feels that the information may be used like a stick with which to later be beaten?  Few will speak of this out loud, but the issue is real and legitimate.  Any mishandling of patient clinical data, either to violate the privacy of the patient, or even to punish the choices of the practitioner, results in the same limitation.

Using information needs it’s own sets of ethics and guidelines.  The technology, thought considerable, for the EMR is not sufficient to understand, there remains the evolutionary psychology and professional ethics to provide the assurances required for adoption.

Tom