However, this is a very old business model used by companies to make people buy new products regularly.
Chile, a South American country, has imposed a fine of approximately 3.4 million dollars (Rs 25 crore) on Apple for cheating customers.
According to an investigation in Chile, Apple has cheated people who used its iPhone in the name of a software update. And by doing so, the phone becomes slow and its battery life reduces. This is done deliberately so that people buy new phones.
However, this is a very old business model used by companies to make people buy new products regularly. We often hear the term 'New Arrivals'. This entices people to go for new clothes, shoes, phones, furniture, etc. Many times, people don't even need the things that they buy.
Earlier, companies used to advertisers their products by saying they would last long, i.e. people would buy products going by their longevity. However, now the concept has changed and so have consumers' tastes.
Mobile phone companies frequently introduce new models, which makes people believe that they need to buy the latest ones. Not only Apple, even Samsung and other big electronics companies resort to this tactic.
This doesn't only hold true for gadgets but also for watches. Watches earlier used to prized possessions. In earlier times, people would use one watch for a lifetime, but nowadays, with the advent of smartwatches, people feel the need to change their watches frequently.
This business model is over 100 years old. During the Great Depression all over the world. A Marketing Genius of America by the name of George Frederick had thought that people should be compelled to buy new things, which would revive the economy. His Idea became very popular and it was first used by light bulb manufacturing companies.
In the 1920s, an agreement was signed between Phillips, General Electric and Osram companies. They reduced the longevity of light bulbs. Earlier, when these bulbs were lit up for 2,500 hours, but it was reduced to 1,000 hours only. This way consumers had to buy bulbs more often and companies made a profit from this business model.
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