CUTTING ROOM: Evan Davis at large

CUTTING ROOM: Evan Davis at large - Big numbers - the directory inquiries saga; how a Firestone plant lost control; Gilmore airs his rights; the business case for ID cards ...

by Evan Davis, economics editor of the BBC
Last Updated: 31 Aug 2010

Big numbers - the directory inquiries saga; how a Firestone plant lost control; Gilmore airs his rights; the business case for ID cards ...

The recent changes to the directory inquiries service, first mentioned in my column in May, will become the subject of business PhD theses in a few years, given that Britain is now the biggest deregulated directory inquiries market in the world.

Most of the new services will have disappeared by Christmas, so we might view the current situation as a heat to select entrants for the next round.

Among those that will make it through, 118 118 must be a cert, with the catchiest digits and the most memorable advertising campaign.

Yet the company behind this number - InfoNXX - tried to persuade Oftel not to allocate the number 118 118 to anyone, on the grounds that it would give the holder an unfair advantage over other operators. Oftel rejected the plea, although it accepted that no-one should be allowed to use 118 192. As a result, 118 118 was allocated, and InfoNXX snapped it up for pounds 2 million.

In the US, 85% of calls to operator assistance (as they call it there) are put straight through by the operator. InfoNXX claims that early indications on their 118 118 service suggest that half of calls are connected that way. Given the generally high price one pays for that, people are either very rich, very lazy or very ignorant about the price structure of call connect.

A fascinating academic study into the problems at Firestone, the tyre company, in the US. You'll recall that in 2000, Firestone and Ford had to recall 14 million tyres on Ford Explorer vehicles after blow-out problems occurred when the tyre's rubber tread detached itself from its steel belt.

There has long been speculation that Firestone's quality control problems were related to a contentious strike at a plant in Illinois. It was alleged that under-trained replacement workers were used, demanding 12-hour shifts were introduced, and supervision was lax. As tyres are still, in some measure, hand-made, it was argued that morale problems could be expected to affect product quality.

The study concluded that, yes, there is evidence that the strike had an effect on product quality. And the authors estimate that 40 lives were lost because of low-quality products from the Illinois plant. The P235 tyres made there during the dispute were 15 times more likely to lead to a financial claim against Firestone than were tyres made at other plants.

After the recall, the company's top management was replaced. The plant was closed in December 2001. A lesson worth remembering.

As the British debate about the possible introduction of ID cards rumbles on, you might enjoy hearing about the American multimillionaire John Gilmore, who is suing the US Government for requiring airline passengers to show ID before boarding a plane.

Gilmore made his money at Sun Microsystems (he was the fifth employee) and Cygnus Solutions, and he now spends it on various libertarian stunts.

The case now in the US courts concerns two flights in July last year.

He was refused permission to board a Southwest Airlines plane for not showing ID; for a flight with United, he was allowed to board without ID, on condition he submitted to a hand search (he refused). Gilmore sees this as a breach of his 'right to travel'. We wait to see whether a judge lets the case proceed.

More recently, Gilmore recently got himself ejected from a BA flight for refusing to remove a 'suspected terrorist' badge he was wearing. Strangely, BA thought that by removing his badge, any danger he represented on board would be eradicated. But as for his campaign against IDs, I'm not sure.

Of course, we have to protect our rights; Government sometimes goes too far; and endless ID checks offer a false sense of security, given that IDs can be faked. But the debate has two sides and we hear far more about the libertarian arguments against than the practical arguments for.

Why has business not made a vociferous call for their introduction? Surely businesses would find life easier if we each had a single ID card, with fingerprinting or retina-scanning technology embedded, and a unique number for our personnel records, tax files and tax credits, as well as the basis for borrowing and store loyalty cards. The community of small businesses would stand to gain the most.

Instead, the business arguments for IDs are entirely drowned out by those who think the use of voluntary ID cards takes us one step closer to a Nazi state.

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Upcoming Events

Subscribe

Get your essential reading delivered. Subscribe to Management Today