RoHS Compliance

Without doing any professional research on the matter, here are some speculative and therefore, highly suspect thoughts. In other words, I'm only writing based on what I've overheard on a peripheral level.

Remember the Y2K scare? Allegedly, computers everywhere were going to fail right and left. Chaos would reign the world over.

How many computer failures did YOU hear about on 01 January, 2000? I didn't hear of a single one. Maybe my life is too sheltered . . . . Even now, however, there is room for Y2K problems which have not yet been discovered but I have to believe that possibility to be remote.

Nevertheless, there was plenty of fear about the subject which resulted in a frenzy of buying replacement computer systems and software. I suspect that in the process, there was some innovation in software designs, etc. etc. But what can't be denied is the fact that there was a huge boom in the electronics industry and a LOT of people made huge amounts of money in the process.

So, came 01 January, 2000, the extreme majority of all computer and electronics users had replaced substantially all of their equipment and it was all new.

Now I don't know about the rest of you but I don't replace my computer every year. In fact, if I can, I try to make it last about 5 years and since I don't demand a lot from it, I can usually make it last a very long time. I know a lot of companies feel the same about it. They make their systems last as long as possible. More power to them and us.

Remember what happened in the subsequent years after Y2K? Recession, especially in the electronics industry. The pool of consumers and businesses buying new electronics shrank considerably. As the recession progressed with fewer customers for new products, companies went out of business in droves. The new equipment they had purchased during the boom of Y2K was sold as used and people and businesses got some great deals . . .

. . . and new stuff simply got sold in much smaller volumes for quite some time.

I think most of that equipment has been used up and the electronics industry seems to be juuuuust about to get back on its feet. Many systems bought during the Y2K scare are still being used but they are getting replaced now. Finally. Hell, a lot of those systems are still using Windows 98 to the extreme that Microsoft even extended it's deadline for End of Life on Windows 98 and they are still supporting it for that reason. There's your key indicator. When those Windows 98 systems all go away, you can be sure that most of the Y2K systems are finally gone.

But there is another problem which is faced by the electronics industry every day. Actually, two very closely related problems. Prices and Life Cycles. The electronics industry is one of the very few industries in which products continually get better AND cheaper at the same time. Remember the first Compaq "portable" 21 years ago? It had ten times the memory of anything else with a whopping 640K (yes, that's "K") of RAM. TWO, count 'em, TWO floppy disk drives. (Personally, I hadn't even heard of a hard drive at the time, though they did exist.) It had a VGA monitor and with the proper RF modulator, it could easily be connected to a T.V. to conjur up some pretty cool graphics for the day. It cost about $4,000, not including the printer and some WordPerfect software.

Nowadays, people are getting PDA's and cell phones which are FAR more powerful than that Compaq "portable" and if you work the deal right, you can damn near get 'em for free. Look at the Zire 72. Whoa. Most desktops made before about 6 to 10 years ago couldn't even compete in terms of power and capability, to say nothing of doing it for the same price. Try $300 vs. $3,000.

So, what's the effect of that pricing problem on the electronics industry? Well, everything gets better and cheaper which results in better market penetration (two cars in every garage and a computer in every living room) BUT, and this is the kicker, electronics companies have to deal with continuous pressure to get their prices down and THAT means, they are operating ever more closely to their break-even points. Moving closer and closer to the edge of the cliff, so to speak.

They HAVE to produce new products. Which brings me to the other component of the electronics industry's major problem: life cycles. When a new product is introduced, the price of it on the shelf instantly starts to decline because the product is only going to be "the latest and greatest" for a very short time. If the company is exceptionally lucky, they'll get a year of good sales out of a single product. Typically, it's more like four to six months. At that point, they'll be lucky to unload it for ANY price and the product gets relegated to pretty near garbage status. The only way for a company to do well and make any money is to release a new product every six months. Or even more often.

It's nearly a Catch-22. The very thing that makes electronics great is the same thing which shoots it in the toe. We make better and better products and we do it faster and faster all the time but doing so creates a vicious cycle of continuous and very rapid replacement of products on the shelf. Continuous and rapid obsolescence of all products electronic. Even the capital equipment required to build these products goes obsolete VERY quickly. Prices fall to the point of making it impossible to turn a profit on any "old" product.

Nasty. Kudos to the managers and company execs who manage these products and make the decisions necessary to keep their companies afloat in such a scenario.

So, I have this idea that the Y2K panic, while not conspiratorial, seems to have given the electronics industry an idea; that they have to create some kind of crisis to generate a buying spree every so often in order to keep afloat.

Introduce the RoHS (Restriction of Hazardous Substances) Directive. Essentially, it says that manufacturers are to reduce the amount of things like Lead, Mercury, etc. etc. from the products made in the electronics industry. It appears that the primary focus for the electronics industry is lead. Lead is an important component of the solder used in all or most electronics components. It gets blended with tin or silver, et al and serves to make the solder last longer, be more flexible, and resist the ordinary wear and tear and the effects of age on a circuit board. Take it out and you reduce the reliability of the product.

Note this, too. The entire electronics industry produces less than 10% (going from memory here) of the world's lead "waste" or "pollution." Even if the entire electronics industry goes completely lead-free, the world's lead pollution problem will still be an issue. (If we really want to eliminate lead from the environment, guess who we need to talk to? Battery makers, maybe?)

So what have we done here? RoHS has created another crisis, similar to that of the Y2K crisis. The only difference is, instead of affecting people at an end-user level, we have moved the crisis to the level of the electronics manufacturer. The result is similar, however. It obsoletes a lot of older inventory and demands its replacement. Prices are stabilized and profits can be restored. Puts companies a little farther above break-even because they can justify the increase or at least the maintenance of prices. Also, the reduced reliability of products means that there will be a slight increase in demand, albeit from repairs, etc. Manufacturing will have found a way to keep their assembly lines up and running.

Is it a conspiracy? Well, I'm no conspiracy nutball but this is one of those things which make you raise an eyebrow and say, "Hmmmmm. I wonder." And you do have to wonder. Is the European Union so hard-up for business that they have to create some imaginary crisis in order to compete with the rest of the world? Remember back when ISO 9000 was all the rage? My opinion only here, but that was mostly a "fad" which originated in Europe. I suppose it was a way of suggesting that if you could comply with ISO standards, your product was allegedly a better product and buying from a certified company meant you were doing better than the other guys. Kinda like the car salesman who suggests, "You don't want to buy from THOSE guys! They don't have THIS!"

So what's the deal with RoHS? I think you're going to see a lot of companies, in Europe, ironically, who will want exceptions to the "rules" and they'll gum up the whole works right before they go completely out of business. There will be plenty of exceptions made in the medical and aeorspace industries to allow their products to be made with lead in the solder to provide the reliability they demand. The prices of non-lead products will go down, eventually, as more and more companies comply. The prices of non-compliant products will start to rise as they become ever more difficult to find. Eventually, soldering and other metallurgical technologies will rise to the occasion and we'll find that we can make things without lead which are just as reliable as things with lead.

We have to hope.

But I still have to wonder: How on earth are we going to fix the problems of excess lead in batteries? Can we? I'd be the last to know but I do believe this: RoHS isn't about solving problems with lead or other hazardous materials in the environment. It's about stimulating the electronics industry and giving it a boost for a while. Especially in the European Union. The only questions are going to be, "How long will the boost last?" and "What crisis is going to come up next in order to boost the electronics industry?" Or, to rephrase that last question, "What is the European Union going to do next in order to create a bigger market for itself?" Short of actually producing some quality and service on its own merits, that is.

--Wag--