What's best for the customer is best for the company

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When Open is Open

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If you've been following Linn closely over the last couple of years, I doubt you'll have failed to notice our emphasis on Open. We do this in the knowledge that Open is best for the customer and at Linn we believe, as my father Ivor is fond of saying: What's best for the customer is best for the company.

Back in 1972, he created Linn around the Sondek LP12 turntable with:

  1. An Open design ethos: Modular, expandable, upgradeable. Open to future improvement. Recognition that customers might wish to use non-Linn components. Compatible with any hi-fi system.
  2. An Open manufacturing ethos: Anyone could learn how to build the LP12 from start to finish and develop expertise, as opposed to the more common production line tending to use humans like robots on only one part of the process.
  3. An Open sales ethos: The TuneDem empowered customers to decide for themselves, and choose the hi-fi that was best for them, even if it wasn't Linn.

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Why did Ivor take this Open approach? Why not deliver fully-loaded one-piece turntables off a production line through the mass market, using clever marketing to persuade people of its acoustic benefits?

Clearly he was convinced of the merits of his design breakthrough, yet at the same time he knew that it wasn't perfect, and so he gave the LP12 the ability to be improved in the future. He created a company filled with people who would be interested in making and improving the LP12 which still stands almost 40 years later. And because he was not afraid to have people compare his turntable against anyone else's, he ensured that those who bought his product did so of their own volition. Ivor showed that Open is a corporate attitude first and foremost, which pervades every activity of an Open company.

A Case of Open but Shut?

As CES 2010 comes to a close in Las Vegas, beware of those companies who claim to be Open because they adhere to an open standard. The adoption of open standards or technologies is only part of the story, and on its own does not imply an Open company, nor one with the long term interests of its customers at heart.

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Many companies adopt open standards as a way to attract customers into other types of lock-in. For example, almost all automotive companies implement open standards within the vehicle, but increasingly some are attempting to introduce parts only compatible with their own diagnostic tools. In what was previously a very open market, those companies are deliberately trying to reduce the amount of open-ness in the engine and striving for sole supplier status. Sole suppliers are bad for both manufacturers and customers alike because they reduce choice and tend to limit value creation in the long run.

Many others use open standards where convenient — where they can be leveraged — and then layer unnecessary proprietary technology on top in order to lock customers into their platform. Apple, for example, has Wi-Fi in their iPod Touch / iPhone, which allows customers to access the entirely proprietary Apple App Store. For those not familiar, the Apple App Store hosts applications only for the iPod Touch / iPhone; applications are vetted via an opaque process by Apple staff before being admitted; the delivery mechanism is via an Apple iTunes account only; applications can only be created using Apple's development system. The reason for it all, of course, is to justify and allow Apple to take a third of all the revenue from application sales.

Designing for the Unexpected

The most crucial aspect of an Open corporate ethos is a commitment to looking after the long term interest of customers.

A closed solution does what the manufacturer defined and what they decided when they designed their solution, but it is impossible for the customer to stray outwith the bounds of that definition, impossible to extend or to personalise the solution beyond the confines of the manufacturer's design horizon.

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The manufacturer-defined, closed solution can be alluring at the point it is purchased, because it can appear to meet the criteria today. However, the limitations will become apparent the very first time that the customer wants to add a feature or use the system in a way that the manufacturer did not foresee or permit. These companies hope you will replace the product or solution before that happens.

In total contrast, Linn, as an Open company, tries to take the longest term view of customer satisfaction at every stage. Choices are made at the design stage to allow for the unanticipated, the unintended — even the unwanted — uses of our products. By owning and controlling the key processes that affect the quality of our products rather than buying-in, Linn is able to continuously improve its products, improve its cost-versus-performance value and offer long service life. Linn allows its customers to extend the solution indefinitely as requirements change and new ones appear over the years.

Studio Master

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This month we launch our Studio Master music package offer with the purchase of any Linn DS. Because of our Open ethos, we can work with the manufacturers of different storage solutions for each Linn DS, rather than force our customers into a one-size-fits-all package.

Our Open approach to our music label, Linn Records, means we offer Studio Master quality music, DRM-free, and indeed were the first to do so. We chose to offer music in FLAC because it is completely Open. After a fierce debate, the eventual basis of our momentous decision to allow customers to use Linn digital downloads as they saw fit, even though some argued it would lead to lost sales through piracy, was that it was undoubtedly best for customers, and in the long run would therefore be best for Linn.

Because we are Open, we host Studio Masters from a variety of independent music labels on our site and, with a transparent and simple non-exclusive contract, ensure we are easy to do business with and offer a fair deal to artists.

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Don't Tolerate the Intolerant

Finally, as 2010 unfolds, I will be keeping a close watch on Google's Android mobile platform. It will be in direct competition with Apple's iPod Touch / iPhone and it may be more Open on many levels.

Indications are that Google will let the public decide (through some sort of a rating procedure) which applications are best for Android. Apple on the other hand is telling the public which applications the public wants. Indeed they have rejected quality applications on a number of occasions simply because they compete with Apple's interests and the interest of their chosen network operators, including music player applications, alternative developer frameworks and VOIP applications. We wouldn't tolerate this in government — why do we tolerate it in companies?

Whereas Apple have signed operator-specific contracts around the iPhone (it was O2-only in the UK until recently), Google's Nexus phone will be offered through all carriers. In addition, customers will be able to choose from a wide variety of Android-based phones. If Google takes the Open approach, Android stands a real chance of becoming the pervasive open standard in the mobile market.

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