A few weeks ago, I wrote a blog post about how to make money when customers want to provide their own on-site service. Then someone kindly pointed me to the subject of Digital Right To Repair (DRTR) and sent me a link a web site that dealt with DRTR and medical instruments.. That got me thinking, reading, and talking. Here is what I learned and why I think that DRTR and customer experience (CX) will engage in a long, hard fought fight before one side dominates the other.
Digital Right To Repair
The fundamental question being debated is “who owns the digital content of a product?” Digital content, in this discussion, is focused on firmware, software, and diagnostics. Many OEM’s only supply firmware and patches to the end-user if they are covered by either a warranty or service contract. So, no entitlement, no updates! And diagnostic software, tools, and “useful” service manuals are generally reserved for the OEM’s service organization.
These days the issue seems to be concentrated in three product areas:
- Automobile repairs,
- High tech products,
- Medical devices.
Let’s look at each and explain what the OEM’s gain by controlling the digital content.
Automobile Repair – some states have passed laws requiring manufacturers to provide digital content to independent service stations. In Massachusetts, where I live, we passed a law last year requiring digital content availability by 2018. Here, the issue is driving repairs to the dealerships. Servicing cars is a profitable line of business and dealers fight very hard to keep their new cars under their service umbrella. Additionally, customers usually look at the new cars while theirs is being serviced and this leads to many “unplanned “purchases. It’s all about the money!
High Tech products – OEM’s want to make sure that their service business makes as much money as possible; just like the automobile businesses. But, according to a Service Manager at a high-tech support company, another issue is managing product end-of-life. If an OEM supplies digital support only to end users under maintenance contract, then the OEM can terminate support, stop selling contracts and effectively strongly encourage the equipment owner to upgrade before they are ready. Some third party service businesses do provide post end-of-life support but some customers feel this option is too risky. According to the service manager, some third parties generate between 25% and 50% of their revenue just from end-of-life support where the end user is happy with the product, has not need to upgrade and wants to keep the “obsolete” stuff operating. In this case, it is more than service revenue – it is about replacement sales.
Medical products – hospitals have Bio Medical Technicians on staff 24×7. Their primary role is to keep hospital equipment operating, whether in or out of warranty. Here is an excerpt from the DRTR website that states the issue as the DRTR folks see it:
At many hospitals, during the product acquisition process, the Bio Med department even requires the manufacturers to provide a detailed service manual before they will allow a demonstration product to be left for clinical trials. This is because the manual is most likely to be provided before the sale; after the sale many companies refuse the request! And these people increasingly carry lots of weight. For a more in-depth article on the issues click here>> For the hospital, it is a matter of equipment productivity, patient outcomes, and economics. For the OEM it is a matter of money.
DRTR and CX
A goal of most modern businesses is achieving a high level of customer satisfaction/loyalty. How can they achieve this goal when customers are being forced into making unsatisfactory economic decisions? How can they recommend a supplier who is “holding them hostage” to pay for expensive maintenance contracts and/or replace perfectly fine equipment with new stuff because they can no longer get quality service and support? Looking at the issue from both sides, we can see that whatever decision the business makes it will impact their revenue, profits, and their customer’s experiences. This will be a difficult decision and will take time for companies to decide on their approach.
What would you do if you were running a business facing this issue?