Adventures In Nerd Land

“I don’t understand why customers are having trouble with the sign-up process for that service”

I was in one of those kinds of meetings full of the uppity ups, the kind of meeting where you want to hopefully leave a good impression* because who is in attendance.

We were looking at solving a problem related to customers struggling with the sign-up process for one of our services, and we were struggling to come up with a solution because, well, we simply didn’t understand why customers were having problems.

But then again, why would we?

I was arguably the least technical person in the room (with respect to computers and programming anyway), and I can still build a server or a PC from spare parts relatively easily.

So imagine what the other people can do.

Just like everyone else in the room, old computers get turned into home servers; they’re multiple computers in use in my home at any one time (currently using three in my home office).

A new technology or gadget comes out, quite a few of us go right out and buy it out of curiosity.

I think everyone I work with has some combination of Xbox, PlayStation, Roku or Apple TV in their homes, yet, quite a few of us were on Amazon looking to buy the Chromecast when it came out. I mean it was only $35.00 and we’re curious nerds with disposable income, why wouldn’t we buy it?

Another example of the disconnect is that consumers often think of Smart Phones as iPhones, Samsung S4s and other models, whereas we nerds think iOS, Android, etc.

For the record we did come up with some options on resolving the problem, but I feel we didn’t quite get there, as we simply don’t completely grok why the problem exists in the first place.

The recent success of MS Office for iPad (top ten in free downloads, top ten in revenue**) got me thinking about that meeting from a few years back, and how so many technologists and people who write about tech are completely detached from the average consumer.

Namely: it got me thinking about the naysayers, those who felt that iPad users had already adopted alternatives and didn’t care about office, people who felt that office was old news, the techno-snobs who look down on it simply because it’s older than say Google Docs, iWork or Open Office, as opposed to considering the features, etc.

I saw more than a few sarcastic remarks about the MS Office for iPad on my social media feeds from people I’ve worked with over the years. Common theme was “too little too late”, or “old tech no one cares about”.

While you could argue that perhaps I shouldn’t have taken some of those comments seriously, the flipside is that many of those people are technology professionals if not executives, good ones at that.

Looks like Microsoft got the last laugh.

All that being said: all of this could’ve been avoided if someone had just taken a survey of business professionals who own iPads and use MS Office, and asked them: if they wanted MS Office for iPad; as opposed to evaluating the market through the prism of your own perceptions.

While it can be hard to tap the pulse of the consumer’s interest and no should be derided too hard for missing the boat, if you try to tape the pulse of the consumer by using your own pulse you’re almost guaranteed to be wrong in the tech market.

So the question offered is: due to being brainiac nerds with a lot of disposable income, what else are we missing the boat on as far as product and service offerings?

Final thought: the success of MS Office for iPad is a clear example of how tech companies might need to stop thinking along the lines of locking people into their ecosystem, and think more in terms of being cross-platform. If I were a Microsoft executive I would be crying myself to sleep right now thinking about all the money that was left on the table by not offering Office for iPad as SOON as the iPad was released and heavily adopted.

Crying.

If I were one of the execs in charge of saying no to the iPad I would be at my Mama’s house*** right now crying my eyes out.

*At one such meeting I was given an “atta boy” for something I had worked on, and I joked “I should just go home now, it’s probably all downhill from here”

These meetings also remind me of gym class in high school and the times where we weren’t separated by gender or when the girls could at least see us, or say a girl you like showing up to one of your sporting events. There is something in the mind of a teenage boy that is convinced that higher athletic performance = booty. Still I remember running a race and falling behind around 250-300 meters, remembering that a certain girl was at the track meet and blasting by everyone for the win.

But then I threw up, so it wasn’t that cool in the end. 

**It’s worth noting that only “some” of the revenue generated by Office for iPad comes through the Apple App Store, other revenue either goes direct to Microsoft (E.g. Business Versions) and/or people attach the app to existing Office 365 subscriptions. I.e. the Apple revenue lags behind the total revenue and may lag rather significantly.

 ***Unfortunately for me my Mom wouldn’t offer much in the way of sympathy, if anything is an anathema to Caribbean immigrants it’s leaving money on the table. I mean, my Dad once told me about being irritated at his partners for taking about 10-15% less than he thinks they could’ve gotten on a business deal, a deal that occurred seven years ago. So, yeah, I would be a grown man in trouble with his parents. ß Partially joking here. 

Does The GOP Know How Health Insurance Works?

The nine people who read this blog are well aware that if there is anything that drives me crazy, it’s misinformation & nonsensical financial analyses, especially if it’s so riddled with cognitive bias that the numbers were bent to fit a preconceived notion.  

For example, this article from Forbes on Obamacare allegedly “ripping off” younger adults (emphasis mine):

“Overall, the Federal government reports that 32% of on-exchange enrollees as of March 1st are under the age of 34. And many of these are teenagers who are part of family policies, not the young yuppies that Obamacare is fervently targeting. Earlier estimates showed only 20% of enrollees were between the ages 18 and 34.

The final number of young enrollees is well below the required cohort. Premiums will rise next year as a result of the adverse selection of older, and probably less healthy consumers. Why are young adults staying away? In one word, economics.

Obamacare is asking young adults to effectively subsidize the healthcare costs of older Americans. So far, Millennials are resisting this age-based transfer of wealth. Many are clearly opting instead to remain uninsured, or else they are buying cheaper health plans that don’t conform to Obamacare’s regulatory dictates.”

The article then goes on to discuss various healthcare plans in various states at various income levels, ranging in cost from $135-$225/month, with deductibles ranging from $600-$5,000.00. Normally I would go to various exchange sites and verify the numbers, but some of the conclusions of this article are so bad that even if the numbers are 100% correct I CAN STILL rip this analysis apart with ease, for a variety of reasons:

The Article’s main thesis is that young people are choosing not to buy insurance because it’s too expensive and/or they don’t want to get “ripped off” by older people. Here is the problem with that idea: 16% of Americans don’t have some kind of health insurance coverage (via their job, private market or public coverage), and out of that number only 20% can afford to buy their own.

I repeat only 20% of the population without health insurance could afford to buy it pre ACA, a number that equates to 3.2% of the population overall.

In other words: if someone doesn’t have health insurance there is a very high likelihood they don’t have a job that provides it, they can’t afford it and they don’t qualify for publicly funded coverage.

It’s not really a matter of opting out or not wanting to get their “wealth transferred” to older and less healthy people, it’s the confluence of income and the benefits offered by one’s employer.

The author thesis is nothing more than hyperbole if not outright lies and misinformation, as there aren’t any objective data points or facts behind it.

But that’s not the only issue: 

  • You can stay on your parent’s insurance until age 26, which (obviously) reduces the number of people under age 34 who need to buy insurance via ACAfs.
  • Premiums of $135-$225/month are fairly common for employer subsidized* health insurance where your employer is kicking in an amount that’s at least equal to what you pay (if not more) let alone plans where you foot 100% of the cost yourself. More importantly pre-ACA private market plans often cost as much as the plans mentioned in the article (if not significantly more), and often provided less coverage. The plans I can now get via the WA State exchange cost about the same if not less than what I paid when I was self-employed, and provide far better coverage. **
  • The author notes a $600 deductible as if that’s obscenely high when the truth is that it’s below average. Look at this survey on average health insurance deductibles, from 2006-2008 they went up 18.9% (Bush Admin) for PPO plans and by 15.6% during the first term of the Obama administration. Either way, $600.00 is less than $733 average deductible in 2012.
  • Speaking of deductibles, it’s intellectually dishonest to mention the deductible without noting what the plan covers. The reason for this is that it’s not at all uncommon for a plan to cover everything a person needs without the deductible being met. For example up until 2012 I paid for a private market insurance plan which cost me $244/month with a $5,000 deductible, and despite the $5k deductible the plan covered everything I needed. It’s worth noting that during that time I had to see a metabolic specialist, get lots of blood tests, etc. I.e. the deductible doesn’t tell the whole story, and may not be a factor for your health care needs.  
  • The final (and arguably most important aspect) is that calling health insurance a “wealth transfer” or something that rips off young people, suggests either intellectual dishonesty to make a political point, or ignorance of how insurance works. Namely: the purpose of insurance is to share costs, you subsidize others when you don’t need it as much, and other people subsidize you when you DO need it. Calling it a rip off or wealth transfer is, well, nonsense. Better yet: if younger healthier people are being “ripped off” and having their wealth transferred to less health older people, than it also means that childless couples are being ripped of by couples with kids, healthy people are being ripped off by sick people, etc., etc. 

I sincerely doubt conservative folks who hate ACA would support a movement by childless couples (like my girlfriend and I) demanding that people with children stop ripping us off and stealing our wealth.

Not to mention the fact that prior to ACA young people with employer sponsored insurance where paying the same rates as their older, married, child raising co-workers, and I heard nary a peep from the GOP about it.

Just think about it: the larger implication of the author’s thesis is that any health insurance plan with a cohort that is younger, unmarried, childless, healthier, etc., is being ripped off by other users. Again, I don’t see him defending childless folks from my breeding co-workers.

For example:

The consulting firm I work typically hires people who have 5-7 years of experience in either consulting or the business world. Based on the new hire profiles that come across my inbox I’d say 80-90% of them are at least newly married, if not married with children. 

The benefit booklet for my consulting firm shows the exact amounts my employer pays towards health insurance premiums for singles, marrieds, single parents and those that are married with children. A rough back of the envelope calculation suggests that my firm forks over millions in premiums on top of what they pay for single folks like myself. 

So - thought experiment if we’re to take this Forbes article at its world that health insurance can be a wealth transfer. Do you think I can get this right leaning publication to publish articles supporting the idea that single people like myself are being ripped off by employers that subsidize insurance for our co-worker’s spouses and/or children? Do you think I could get them to support the idea that employers should take the money they spend on premiums above the cost of a single person and distribute it equally amongst all employees? 

After all based on my rough calculations this would be worth several thousand dollars a year to single folks like myself… 

But we all know the “oh no, people are waiting until they’re stable to get married, single mothers, AIEEEE” GOP would support no such thing. 

Note: if anyone from work reads this, I’m NOT ADVOCATING THIS AT ALL, don’t throw coffee at me in the break room. I’m not advocating it, because, well, unlike some people, I don’t write rubbish articles that ignore how health insurance works***

Maybe someone should tell the GOP and right wing pundits that when you attack legislation, policy or an idea with hyperbole and misinformation, you inadvertently wind up supporting the thing you’re attacking. It’s pretty simple: if you had valid criticisms you wouldn’t need to resort to hyperbole.

Every kid on the playground knows that when your comeback is “no, I don’t smell, YOU SMELL”, you’ve lost the argument.

Another way to look at it, is that the GOP is afraid of ACA succeeding and people coming to expect to live in a world where they can buy insurance via state run exchanges. So afraid that they’d rather resort to a smear campaign instead of voicing any one of a number of valid criticisms, and working with Democrats to make ACA better. 

Neither scenario makes people on the right look particular good, better yet, does the GOP really want to go down in history as the party that relentlessly attacked the ability of people to BUY HEALTH INSURANCE outside of employee sponsored plans for political reasons?

Final point: the author of this nonsensical article is a bloody Doctor, which suggests, he knows damn well how health insurance works AND that it’s not all uncommon for young people to have serious health conditions, get into car accidents, get injured, etc.

IF Physicians knowingly lying about ACA for partisan reasons doesn’t illustrate the GOP’s pathology over ACA, I don’t know what does. 

*To make a fair comparison between employer sponsored health insurance and private market, you’d need to include the amount the employer pays. I.e. the $200/month ACA plan may have a higher deductible than a $200/month employer sponsored plan, but it stands to reason that the employer is kicking in at least $200 if not more, so in truth, it’s a $400+ plan.

**What does the right struggle with the mathematics of “you get what you pay for” when it comes to health insurance? I.e. ignoring the fact that many of the more expensive ACA plans actually reduce the out of pocket costs people had under their bare bones pre ACA rip-off plans, thereby reducing their total healthcare costs in the end?

***Seriously guys, I’m being sarcastic to illustrate how silly Dr. Gottlieb’s thesis is, don’t like, sabotage my Power Point decks. 

Importance of Economic Perspective

Last summer I had a conversation with my boss (on the client side) that went along the lines of the following:

“…the problem is that compared to the average person we make at least 2-3x more money and even the least technical amongst us can build a computer from scratch (I resemble that remark), so we lack the proper perspective to really understand how the average person views our products as far as ease of use and cost. It would be awesome of if could create a focus group or consumer council of just Middle-America average folks, as it would give us great insights into how people view our products and services”.

The basic idea is that in order to market something effectively you have to put yourself in the customer’s shoes, and that can be difficult to do when you’re surrounded by nerds with a lot of disposable income.

One’s perspective can also make it hard to interpret the data you get from studying customers. An example that better connects with day to day reality is this report I stumbled upon this morning, which discussed how Americans prioritize their debt payments:

For the first time since 2008, people have changed the order in which they pay bills — but some experts say Americans still don’t quite have their priorities straight.

A study released Wednesday by TransUnion found that as of September, Americans prioritize paying their mortgages over their credit cards — the first time they have done this since September 2008. However, they still prioritize paying their car loan over both their mortgage and credit cards, a trend that’s been happening for at least a decade. “Auto loans have always been in first place,” says Ezra Becker, co-author of the study and vice president of research and consulting for TransUnion.

Indeed, among consumers with auto loans, mortgages and credit cards, the 30-day delinquency rate for auto loans was just 0.87%, while it was 1.71% for mortgages and 1.83% for credit cards, as of December 2013; Becker says he expects that this trend toward prioritizing mortgages over credit cards will continue. Meanwhile, just a year earlier, consumers were favoring their credit cards over their mortgages: The 30-day delinquency rate in September 2012 for mortgages was 2.42%, while it was just 1.81% for credit cards.

“One of the biggest impacts of the Great Recession to the credit system was its influence on consumer-payment patterns,” says Becker. “As unemployment rose and home prices cratered, increasingly more consumers were faced with financial constraints and had to make difficult choices — and many chose to value their credit-card relationships above their mortgages.”

The words “value” and “prioritize” should never have been used in this study; in fact, Ezra’s interpretation of the results is so terrible it’s not even funny.

The problem with the idea that customers are prioritizing certain debt payments is as simple as: mortgages are usually more expensive than car notes, which are usually more expensive than the minimum payments on credit cards. Think of a household with $400.00 car note, a $1,100/month mortgage and minimum payments on their credit cards of around $150.00, if you only have $700.00 available to pay all three bills, most people will just resign themselves to paying the ones that can afford to pay.

As it is, paying a credit card bill differs from paying a mortgage or a car loan because instead of the payment being money out the door, you can in a sense “re-spend” part of the payment as it frees up available credit. A consumer could conceivably pay a credit card bill and then use the credit card to pay for their cellphone bill, gas, etc.

The data that supports this argument can be found by looking at the drop in mortgage delinquency rates: from September 2012 to December 2013 the delinquency rates on credit cards barely moved (1.81% to 1.83%), meanwhile the delinquency rate on mortgages dropped by 29%. Doesn’t this suggest that the only difference over the course of those 15 months is that people simply had more money to pay their mortgages with?

People aren’t “deciding” which financial relationships the value the most, they’re just paying the bills they can afford to pay. You could only make the “prioritization” argument, IF the payment amounts are similar, a particular customer is trying to decide between paying their mortgage OR auto loan + credit card or you’re dealing with an irresponsible person who say spends their mortgage money on jewelry, gambling, etc.

The misinterpretation of the results goes back to what I mentioned in the beginning: it can be difficult to design services, market products or even interpret consumer data if you don’t think outside of your own reality. As a VP I suspect Mr. Becker doesn’t have to worry about making ends meet, so he views paying bills as a prioritization exercise as opposed to affordability one.

Not that is likely income level is an excuse, I saw the right pattern and I would be surprised if we couldn’t both afford to live in each other’s neighborhoods.

I think the other aspect here is that Banks tend to think less in terms of “can this customer make the payments on this loan?” and more in terms of: “will the customer find a way to make the payments?” This colors the way credit reporting agencies* and banks interpret delinquency data, and that’s what got the banks in trouble during the financial crisis, as they thought they originate risky mortgages and get away with it because people would “always find a way to pay their mortgages”.**

In any event I think the above clearly articulates what happens when you have a myopic perspective, at best it can negatively impact design, pricing or data analysis, at worse, well, it could be one of the pillars of a financial crisis because there is a disconnect between how you evaluate risk and how customers make financial decisions. 

*Ironically, despite the fact that that there is a disconnect (at Transunion at least) between how credit reporting agencies think consumers make debt payment decisions and how consumers actually make them, their risk models are actually pretty good. An example of getting the right answer with the wrong thinking.

**To be fair they did a lot of other stupid **** like thinking securitizing mortgages removed the risk, and consumers were incredibly stupid too, but “people will always pay their mortgages” was one of the underlying, well, stupid ideas. 

STOP SPECULATING ABOUT FLIGHT MH370!

Note: this is me politely ranting about a brand new pet peeve:

Thought experiment:

Step One) Go to Walgreens and purchase a Matchbox Car or similarly sized toy plane.

Step Two) Take the toy to a local park with good-sized pond or lake. Say something like Greenlake Park in Seattle, where the distance around the lake is a little over three miles.

Step Three) Put on a blindfold and hurl the toy into the lake; an alternate approach would be to spin yourself around and then just hurl the toy in a random direction. You could also just go to a wooded area hurl the toy, your keys, etc., into the forest. 

You could also hurl your keys, not all of them, just one of your keys.

Step Four) Find the toy, your keys, etc.

The task sounds like finding a needle in a haystack doesn’t it?

Now pull up the Indian Ocean on Google Maps and you’ll see a large swath of, well water without much else, it’s an ocean that contains 20% of the water on earth and is 28,350,000 square miles or 73,556,000 square kilometers. The Ocean’s deepest point is about five miles deep, it’s average depth is about 2.4 miles deep. 

Depending on the model a Boeing 777 plane ranges from 63.7 to 76.5 meters long with a wingspan of 60.9 to 71.1 meters.

Having difficulty finding an object that’s 63.7 to 76.5 meters long and 60.9 to 71.1 meters wide, within a space of about 73.5 MILLION square kilometers seems, well, very reasonable, no?

In fact, it’s probably easier to find a matchbox car in a lake that it takes 3-3.5 miles to circumnavigate, than it is to find a plane in the Indian Ocean and that’s IF the plane is in the Indian Ocean in the first place.  

The idea that an entire plane can be lost is perfectly reasonable when you think about it, especially if you look at a map of the larger area and consider the fact that the plane may have landed or crashed elsewhere.

Now consider that:

  • Radar doesn’t have unlimited range.
  • Satellites aren’t covering every inch of the earth
  • Planes have transponders and communications equipment to help keep track of them, and if those systems are shut off, malfunction, are no longer operational because a plane crashed, etc., it’s going to be hard to find the plane.
  • It’s hardly uncommon for large planes to be lost and never found again, or for it to take years for a plane to be found. When Air France flight 447 crashed it took two years to find the plane, despite the fact that some debris was found five days later.

Think about it – they had a great idea of where the plane crashed, even found some debris and a couple of bodies, and it still took two years to find the rest of the plane because they had to search the bottom of the ocean over a space of millions of square miles.

Millions.

Consider all of these facts, and please stop with the “how can they lose a plane in a post 911 world”, as it sort of indicates sheer ignorance of geography, spatial relationships and technology. You don’t sound smart, edgy, subversive (it’s a conspiracy), you just sound dumb.

Stop saying “how can they lose a plane?”, because it sounds like you’re saying: “why is it so difficult to find an object that’s 63.7-76.5 meters long and 60.9-71.1 meters wide (just the wings, cabin width is 5.87 to 6.10 meters) within a volume of water that’s 73.5 million square kilometers in size?

Not to mention we don’t even if it’s actually in the Indian Ocean at all and not in another body of water or somewhere else all together.

Stop it.

This is a very difficult and possibly macabre task to undertake, the people involved know what they’re doing, the reason we don’t have more information because they’re doing something incredibly difficult. SO maybe we should stop with the speculation and armchair quarterbacking, and just wait until more data is available.

I’m going to throw up the next time another expert says something like: “I’m 100% positive the plane went in X direction, Y happened, etc.,” as if his cranium contains more intelligence and data about this situation than all of the people from ELEVEN nations who are searching from this plane.

All of this rampant nonsensical speculation has got to stop. At a certain level the article from wired is no more credible than the Tabloid and conspiracy theorist shit about Aliens.

The author doesn’t know, I don’t know, all anyone knows is that the search area is huge and finding this plane is going to be quite difficult, so we should all stop throwing out theories and let the searchers do their jobs.

</end rant>  

I&#8217;m at that point in one&#8217;s life where you&#8217;re making the transition from mid 30s to late 30s and want to pretend you&#8217;re still in the former category&#8230;. 
Either way, this man has been imprisoned since I was a little kid, AKA almost the entirety of the life I remember. All due to idiotic and likely racist juries, police and prosecutors. How, how do you repay someone for something like this? The mental torture of spending 30 years waiting to be murdered by the government?  
Anyway, just read the story, the way his mind has been warped my prison in subtle ways we don&#8217;t even consider are, just horrific. 

theatlantic:

Glenn Ford’s First Days of Freedom After 30 Years on Death Row

Anywhere he wanted to go, the jubilant defense attorneys told a hungry Glenn Ford late Tuesday afternoon as they left the television cameras behind, piled into their car, and left the yawning grounds of Louisiana’s notorious Angola prison. Ford was hungry, very hungry, because from the moment he had learned that he would be released from death row—after serving 30 years there for a murder he did not commit—he had decided that he would not eat another morsel of prison food.
On their way back to New Orleans, driving on State Highway 61, there was this one restaurant that Ford had wanted to try, but it had closed for the day. And then the relieved lawyers and dazed client passed a gas station that served Church’s fried chicken and Krispy Kreme doughnuts. Doughnuts? Ford pondered the possibility until the car was about a mile further down the road. “Look, if you want doughnuts we’ll get you doughnuts,” even if they come from a gas station, attorney Gary Clements told his longtime client.
So they pulled a U-turn and arrived back at the gas station. The lawyers got out of the car and started to walk in. Ford stayed in the car. It did not immediately occur to him that he would have to open the door himself to get out. When you are on death row for 30 years, when every door in your life is opened and closed for you every day by guards, you forget that you have to reach out and grasp the handle to move from one place to another. “He was just sitting there and waiting for someone to come and tell him he could get out,” Clements told me.
Read more. [Image: Gary Clements]

I’m at that point in one’s life where you’re making the transition from mid 30s to late 30s and want to pretend you’re still in the former category…. 

Either way, this man has been imprisoned since I was a little kid, AKA almost the entirety of the life I remember. All due to idiotic and likely racist juries, police and prosecutors. How, how do you repay someone for something like this? The mental torture of spending 30 years waiting to be murdered by the government?  

Anyway, just read the story, the way his mind has been warped my prison in subtle ways we don’t even consider are, just horrific. 

theatlantic:

Glenn Ford’s First Days of Freedom After 30 Years on Death Row

Anywhere he wanted to go, the jubilant defense attorneys told a hungry Glenn Ford late Tuesday afternoon as they left the television cameras behind, piled into their car, and left the yawning grounds of Louisiana’s notorious Angola prison. Ford was hungry, very hungry, because from the moment he had learned that he would be released from death row—after serving 30 years there for a murder he did not commit—he had decided that he would not eat another morsel of prison food.

On their way back to New Orleans, driving on State Highway 61, there was this one restaurant that Ford had wanted to try, but it had closed for the day. And then the relieved lawyers and dazed client passed a gas station that served Church’s fried chicken and Krispy Kreme doughnuts. Doughnuts? Ford pondered the possibility until the car was about a mile further down the road. “Look, if you want doughnuts we’ll get you doughnuts,” even if they come from a gas station, attorney Gary Clements told his longtime client.

So they pulled a U-turn and arrived back at the gas station. The lawyers got out of the car and started to walk in. Ford stayed in the car. It did not immediately occur to him that he would have to open the door himself to get out. When you are on death row for 30 years, when every door in your life is opened and closed for you every day by guards, you forget that you have to reach out and grasp the handle to move from one place to another. “He was just sitting there and waiting for someone to come and tell him he could get out,” Clements told me.

Read more. [Image: Gary Clements]