Monday, September 16, 2013

BBC's nonsense tech story

I can't ignore this story from the BBC about the "first" online shopping. It's wrong in every respect. Firstly, it may have been a first for Britain, but it comes years after the "Minitel" system in France was used for online shopping. Secondly, online shopping still doesn't work that way. Thirdly, it's not the same as the Internet -- it's the opposite.

France rolled out it's systems in the late 1970s, called "Minitel". It was "teletex", which meant that it used a really slow modem, and only displayed text. Any "graphics" shown were only slightly more advanced than ASCII art, using special character sets with graphics symbols. The BBC article is about a British clone of the Minitel system in 1984, over five years after France introduced their system, wich is forever in Internet-years.

The thing to notice is that we still can't order groceries from the local grocery store and have then delivered. Sure, we can buy everything else online, from televisions to cars, and have them delivered to our doorstep, but not groceries. There is a simple reason for that -- groceries are a low-price/low-margin business. The only way to make them deliverable is to dramatically increase their price -- to the point where most people would rather just drive down to the store themselves. Sure, rich people can afford it, but not the "average" person or "pensioners".

The system described was not only an economic failure but a technical one. Teletex was designed by the phone-companies based on the principle that all the intelligence was in the network, and that the device in the home was a "dumb" terminology. The most important thing about the Internet is that it upended that principle. It made the network dumb, with routers that simply knew how to forward packets, and put all the intelligence on the "ends" of the network. If there is one thing you remember about the Internet is that it's based on "end-to-end" technology.

My point is this: that BBC article is wrong in every way something can be wrong. It was nearly the first at what it claimed -- France's Minitel was. The scenario they describe, the average person buying groceries, still doesn't work. The technology they describe, the intellegent telco network, was completely obsoleted by the end-to-end Internet.

Update: Many people are correcting me pointing out grocery deliveries are cheaper than I claim, pointing out they have friends who do it, or that they've done it in the past. Okay, they have a point, but at the same time, that they aren't using the service now supports my point that "groceries" isn't the revolution, buying everything else is.

1 comment:

zenographie said...


From a pure economical and historical point of vue, you are definitely right. But paradoxically, one of the very first and most important offer on the Minitel (if you except servers with adult contend) was precisely grocery.

The demand was high, very high. I remember using and abusing of this kind of service circa 1983/1984. I think that the most realistic story written on this subject has been published by IT Expresso

This story tells how, in July 2013, the first big “online grocery store” in France filed for bankruptcy.

“Founded in 1983, 30 years of activity, Telemarket (the company) has never (sic!) been profitable, even with 40 M$ of income” the story said. Even after a kind of “conversion” to the new technologies and Internet. The cost of the logistic was too high, even if the system was based on an important chain store (Magasins U). Transport cost, capital cost in term of vehicle fleet, optimization of the delivery network was a real puzzle. Delivering a one week grocery order for an average 3 people family on a 5 story flat (without lift) is not the same thing than delivering pizzas or sushi.

Now, most of the French grocery market is now adopting the “drive by” system : you can preorder via a Web site, and pick up yourself your goods later (with your own car indeed). Logistic cost are lower than those in traditional commerce, labor cost are lower too (it is just a box-moving business without any real value added service).