Intoduction:
In the late 1990s, Dave Mathews of Digital Convergence Corporation(now-defunct) invented the CueCat. The CueCat was a product of convergence allowing both broadcast and print media to interact and converge with the Internet. With this remarkable new technology, print media, broadcast media, and consumer products act as a gateway to information on anything the customer desired to know. The owner company, DCC marketed it as “ It lets you navigate the web with pin-point accuracy, taking you exactly where you want to be on the web instantly. The CueCat device is like a global positioning system for the Internet”.
Functionality:
It is a cat-shaped handheld barcode reader, which connected to computers using the PS/2 keyboard port and later USB. The CueCat enabled a user to open a link to an Internet URL by scanning a barcode appearing in an article or catalog or on some other printed matter. In this way a user could be directed to a web page containing related information without having to enter a URL. In addition, TV broadcasters may use an audio tone in programs and/or commercials that when, attached to a computer (via an audio) will act as web address shortcut. The data format was proprietary, being scrambled so as not to be usable as plain text. However, the barcode itself is closely related to Code 128, and the scanner was also capable of reading EAN/UPC and other symbologies.
Commercialization:
Like all the breakthrough gadgets, the CueCat was commercialized on a big scale. In late 2000, advertisements containing CueCat barcodes briefly appeared in some high-circulation U.S. mass-market periodicals, notably Parade magazine, Forbes magazine and TIME magazine. For a time, RadioShack published catalogs containing these barcodes, and even distributed CueCat devices at no charge. CueCats were also bulk mailed (unsolicited) to certain mailing lists, such as subscribers of technology magazines, notably Wired magazine.
Commercial failure:
The CueCat concept was a commercial failure. Some believe that failure was due to implementation stumbles that alienated early adopters, but others say the device was ultimately of little use. Wrote once the Chicago Tribune, "You have to wonder about a business plan based on the notion that people want to interact with a soda can," while another newspaper quipped that the CueCat "fails to solve a problem which never existed."
Due to the weak obfuscation of the data, the software for decoding the CueCat's output quickly appeared on the Internet, followed by a plethora of unofficial applications. The CueCat device was controversial, initially due to privacy concerns. Each CueCat has a unique serial number, and users suspected that Digital Convergence could compile a database of all barcodes scanned by a given user and connect it to the user's name and address. For this reason, and because the demographic market targeted by Digital Convergence was unusually tech-savvy, numerous web sites arose detailing instructions for "declawing" the CueCat — blocking or encrypting the data it sent to Digital Convergence.
The company's response to these hacks was to assert that users did not own the devices and had no right to modify or reverse engineer them. Threats of legal action against the hackers swiftly brought on more controversy and criticism. The company's licensing agreement was changed several times, adding explicit restrictions, apparently in response to hacker activity. Hackers argued that the changes did not apply retroactively to devices that had been purchased under older versions of the license, and that the thousands of users who received unsolicited CueCats in the mail had not agreed to nor were legally bound by the license.
Security breach:
In September 2000, security watchdog website Securitywatch.com notified Digital Convergence of a security vulnerability on the Digital Convergence website that exposed private information about CueCat users. Digital Convergence immediately shut down that part of their website, and their investigation concluded that approximately 140,000 CueCat users who had registered their CueCat were exposed to a breach that revealed their name, email address, age range, gender and zip code. Digital Convergence responded to this security breach by sending an email to those affected by the incident claiming that it was correcting this problem and would be offering them a $10 gift certificate to Radio Shack. But the damage had already been done.
Conclusion:
The CueCat case showcased the vulnerability of convergence, when not controlled and supported properly. Winners in digital convergence need, not only a great business strategy, but also a plan to integrate business models and cultures. Integration should be rapid and thorough, addressing a range of issues including privacy, accelerating cost synergies, standardising accounting and financial systems as well as optimising product development portfolios, R&D and customer relationships. In particular, the research shows that cultural and personnel integration is a critical success factor.
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