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Hucksters, Suckers, and the Cue:Cat
Someone in the Know writes: "Now that it's almost completely over for Digital:Convergence, D Magazine (Dallas) unveiled the investments and the suckers surrounding the Cue:Cat and its creator J. Jovan Philyaw. I especially liked the Coca-Cola executive's observation: "... said listening to Philyaw made him feel like his hair was on fire". This was passed around ex-employees and we all got a kick out of it. The company is still alive, apparently, but not doing much anymore."
From the article (emphasis added in italics...):
The Mark: David EdmondsonTitle: President and COO, RadioShack Corp.
Invested: $30 million
Commitment: Manufactured CueCats and distributed them free at all RadioShack outlets.
Quote: "I went, 'Holy Toledo! This is big.'"
Sorry, Dave...
"What is the sound of one belly slapping?"
"The Dumbest Invention in the History of Computers"
.... It's clearly the time to stay
The CueCat was Dallas born and Dallas bred, and it was Dallas' biggest
contribution to the Internet Bubble.
By Glenna Whitley
On Sept. 6, Belo finally ran up the white flag. In a small story on the front
page of the business section, the Morning News announced it was giving up on a
promotion it had hyped more than the paper's recent redesign: a device dubbed
"CueCat" that read bar codes implanted in stories in the News and on sister TV
station WFAA. Invented and distributed by Dallas-based Digital Convergence,
CueCat was supposed to help consumers jump from print to Web without the pesky
trouble of typing. About as useful as an automatic page turner, CueCat's
pointlessness was obvious to everyone, it seems, but the investors who backed
it and the editors and producers who promoted it relentlessly. The game was up
in May when Digital Convergence fired most of its 225-person workforce. Belo
soldiered on for three months-apparently too embarrassed to back down-before
announcing that, in the words of one spokesman, "not every project has a 100
percent success rate."
The Huckster
By Glenna Whitley
Salesman: Jovan Philyaw
Title: Chairman and CEO, Digital Convergence
Bio: Philyaw is a self-proclaimed "luminary figure in the world of direct
marketing." The Digital Convergence web site boasts his past successes,
generating more than $4 billion in business-to-consumer sales for companies
such as QVC, Fingerhut, Home Shopping Network, and National Media. In addition
to Tripledge wiper blades, which supposedly sold $50 million in less than 36
months, Philyaw was the driving force behind Susan Powter ("Stop the
Insanity!") and 1-800-Be-A-Geek, the alias of Internet America, the Internet
service provider whose billboards once blanketed Dallas. He's also the host and
executive producer of Net Talk Live!, which started as a local radio and
television show and is now broadcast on the Web. Digital Convergence invented,
owned, and promoted the CueCat.
Stake: 49.77 percent of Digital Convergence stock
Raised: $185 million
Commitment: To raise and spend more than $300 million to distribute some 50
million CueCat scanners free by the end of 2001, giving consumers a way to get
to web pages without typing in URLs.
Observations: An executive of Coca-Cola said listening to Philyaw made him feel
like his hair was on fire. -June 27, 2001, Wall Street Journal
Huckster Quote: "God loves me twice. Once to give me talent, and twice to grant
me the wisdom to apply it."
The Suckers
By Glenna Whitley
Jovan Philyaw found easy marks among a few Old Media types desperate to play the
New Media game and a certain local retailer desperate to cash in on the
high-tech boom.
The Mark: Robert W. Decherd
Title: Chairman, president, and CEO, Belo
Invested: $37.5 million for 7 percent ownership
Commitment: Mailed more than 360,000 free CueCats to households in North Texas
counties. Began using the technology at the Morning News, several other
newspapers, TV stations, and its many Internet sites.
Quote: "This is not the time for retrenchment. This is a time for well-managed
entrepreneurism, for calculated risk-taking
the course, and soon we will find the path to profitability that consumers are
telling us is there."
The Mark: Steve Forbes
Title: Publisher, Forbes
Invested: At least $2 million
Commitment: Sent more than 800,000 subscribers CueCat and software.
Quote: "[The CueCat] will change the way you use the Internet forever."
The Mark: David Edmondson
Title: President and COO, RadioShack Corp.
Invested: $30 million
Commitment: Manufactured CueCats and distributed them free at all RadioShack
outlets.
Quote: "I went, 'Holy Toledo! This is big.'"
AND MORE WERE BORN EVERY MINUTE...
Mark A. Dacey, president of Adweek magazines, was so "impressed by the
limitless marketing opportunities of the technology" (his words) that he sent
CueCats to all Adweek subscribers... Michael Dolan, chairman of WPP Group,
Young & Rubicam said, "If you haven't seen [Philyaw], it's worth the price of
admission." For Dolan, admission cost $28 million... Bob Guccione Jr. intended
to make his Gear Magazine "the first 100 percent wired magazine by way of the
CueCat"... Meanwhile, David G. Whalen, president and CEO of A.T. Cross,
invested $6 million on a Cross Convergence pen ($90) that not only wrote, but
also conveniently swiped bar codes for the pen owner who happened to be near a
computer and connected to the Internet-and who couldn't type.
"It fails to solve a problem which never existed." --Debbie Barham, The Evening Standard
"Are these folks kidding?" --Sandra Brown Kelly, Roanoke Times & World News
"There's not enough benefit to the reader," says Jack Powers, director of the International Informatics Institute. "What's Forbes' proposition? 'Jerk around with your computer wiring and learn how to scan like a supermarket clerk so that we can send you more advertising.' No thanks." --Russell Shaw, Broadcasting & Cable
"...There's no need for it." --Sunday Times, London
"My first reaction upon receiving a complimentary "cat" from Wired: Why do I need this?" --Dave Plotnikoff, San Jose Mercury News
"You have to wonder about a business plan based on the notion that people want to interact with a soda can." --Jeff Salkowski, Chicago Tribune
"Just when you think the money truck has stopped making its rounds--that just any bunch of idiots can't get funded anymore--here comes Digital Convergence Corp., proving that small-timers with small ideas can still convince fools to part with their money." --David Coursey, ZDNet News
"Scanning bar codes in my apartment was a thrill for maybe 15 minutes, after which I decided I had better things to do with my time." --Edward Baig, USA Today
"Now I realized that CueCat did indeed have a use. It's for those times when you are 1) sitting by your computer 2) reading Forbes and 3) feeling an overwhelming sorrow that Forbes advertisers aren't getting enough attention. One swipe with the CueCat and you get another ad! Is America a great country or what?" --John Dorschner, Miami Herald
"The CueCat isn't worth installing and using, even though it's free." --Walter S. Mossberg, Wall Street Journal
"The CueCat is one of those clever gewgaws that would be brilliant if only it performed some useful function. But it doesn't."
--Richard Des Ruisseaux, Louisville Courier-Journal
"The CueCat is a cheapo bar-code scanner that looks like a marital aid." --Leander Kahney, Wired
"As I installed my CueCat, I found myself marveling at the weird assumptions that underpin the whole thing. Do we really need another tool to help us go to web sites? How hard is it to type in URLs, anyway? And for God's sake, who wants to be tethered to a computer while they read a magazine? What planet did these people come from?...The tool is almost impressively useless."
--Clive Thompson, Newsday