Ask the Board – February 18, 2019 | IAN GADSBY


“How do you assess the product “lifespan” and update cycle of your devices that are in the field?”

There are two factors: One is accounting. One must depreciate at the rate (or faster) than the actual lifespan of the product.  I have learned the hard way when a device is past the practical life, but still has book value how that can impact your P&L.  This is especially impactful when considering large capital items like outdoor digital boards or video walls. 

But that’s for accountants. Let’s talk ‘tech.’

The key factor for me is when the asset won’t be able to meet the standards of the product we offer.  This may be basic function, but it can also mean quality when compared to the competition.  We strive to always buy assets that are the best (at the time) to ensure when compared to our competition, it stands up. However, rapid development cycles make this difficult. Take for example the ever-changing ‘Bezel Evolution’ of video wall LCD a few years ago. Within a three-year period, bezels moved from 7 millimeters to about 2 millimeters. That’s a big visual difference.  So a wall you placed with 7 millimeters might be perfectly calibrated, and function fine. It may ALSO have two years of depreciation left on it when 24 months into the cycle your competitor pops up 1mm bezels right beside your display.  Rather than lose clients, we sometime upgrade mid-cycle.

It’s costly, but it’s the gamble you take with today’s rapid technology evolution.

My advice is this: Buy the best you can afford, if not the best spec in the market at the time you build.  It’s your best insurance over the need for mid-cycle (very costly) upgrades.  As a side benefit, you get the best looking product for your clients as well!

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