The Men Who Made Us Spend

We live in a world where spending never stops.

Cherie? Cherie?

You're going to need to be tannoying this.

'Ladies and gentlemen, can you please stop panicking. '

But why DO we buy what we buy?

And how is our desire to spend manipulated?

Every other company on earth is trying to get you to spend money

and they're putting all their effort into getting you

to spend your money on stuff all the time.

I'm Jacques Peretti and in this series

I'm going to investigate the men who've made us spend.

I'll discover how products

were deliberately made to break so we buy more.

Planned obsolescence is an open secret.

When I'm talking to professional management people,

they all said, "Well, we all know this. "

How we've been reprogrammed to dispose of our possessions.

I don't think individual advertising campaigns

change people's views completely. Why are they still doing it, then?

They're not still doing it. Well, they did in 2012.

You ran a campaign that said you should leave your sofa on the sidewalk.

And how technology has been used to perfect consumerism,

making us constantly hungry for more.

We want the new thing.

It's hard-wired into our brain to be looking for new stuff.

The marketers have figured out how to take advantage of that.

This looks like a concert but it isn't,

it's a lavish promotional video

for the launch of a new gaming console, the Xbox One.

Five! Four! Three!

Two! One!

And the star of the show is a small plastic box costing £450.

Xbox One! Xbox One!

Consumer technology has moved centrestage.

This footage shows how it's treated with an awestruck reverence

once reserved for A-list celebrity, except now it's a console.

And Xbox learned about the orchestrated hysteria

around a product launch from the masters, Apple.

Are you ready? Yes!

For the past seven years, people have queued for hours or even days

to get their hands on the latest upgrade.

We've been out here 15 days, two weeks and one day.

But what drives people to wait in the cold for a new phone?

I've come to the Apple Store on Regent Street

to talk to the very patient man

at the front of the queue for the new iPhone 5s.

And what's the 5s going to do that the 5 doesn't do?

Erm... probably not much.

There's a fingerprint scanner, which is very cool.

So you've queued for three days to buy a new phone

that is not going to do much more

than the phone you've got at the moment?

At the end, we'll walk away with something new that we all want.

Thousands of people are waiting in line.

How long have you guys been waiting? 18 hours. 18 hours.

What is it that's so special

about having the newest phone, the latest phone?

The rate that they change,

they change so quickly you don't want to left behind, do you.

Why is it so important to you to have the latest phone so quickly?

Because this time they are in different colours.

Because it's a different colour?

Yep. That's what's brought you here? Yeah.

It's the part of my life... at the moment.

It's one minute to eight

and the doors of this Apple Store are about to open.

And close to 3,000 people queuing

are going to go in and buy the iPhone 5s.

And the allure, the magic of owning that phone,

the new phone is still there.

Five! Four! Three!

Two! One!

It's like a Hollywood premiere

and all because you can get a phone that's a little faster.

But the flip side of the hysteria for the new

is that the new becomes unwanted, fast.

Yesterday's desired item is tomorrow's piece of trash.

This is a waste facility in California

like thousands across the globe,

except this is one with a difference.

There are boxes and boxes of shiny new, unopened technology.

If you look around here you'll see

quite a few brand-new products still in their boxes.

Yeah. There's some printers there. Yeah, brand-new.

Never been opened. Here's a bunch more right here.

Wow! And those are... They've never been used? Never been used. Wow!

So those are products that...

for one reason or another they decided

that they would rather destroy

then try to sell to somebody who might need 'em.

This cycle of things becoming almost instantaneously obsolete

is at the heart of consumerism today.

After festivals, sites are strewn

with brand-new tents used just once.

Many of us are happy to spend and discard,

and it's this churn of products that supports our whole economy.

And the concern is that our economic recovery

is being driven once again by consumer spending.

We live in a world of almost limitless consumption,

but this didn't happen by accident.

The cycle of relentless spending and throwing away was engineered.

But how did this happen?

To discover its origins I've come to Berlin.

In the 1920s, manufacturers hit upon an idea

that would become fundamental to the consumer economy,

artificially limiting the life span of a product.

It was known as "planned obsolescence,"

making a product that is deliberately designed to break.

And planned obsolescence began

with one of the most basic consumer products of all...

the light bulb.

This is the former Osram factory in East Berlin.

It hid a secret about light bulb production

until the fall of the Berlin Wall.

In the early 1990s,

long-forgotten papers were discovered in this factory.

They revealed an extraordinary secret deal

that would provide the template

for the consumer obsolescence we live with today.

In the 1920s, a coordinated decision

had been taken by a global cartel of companies

to reduce the life span of bulbs.

It was known as the Phoebus Cartel.

The cartel's origins came from the chairman of Osram,

his name was William Meinhardt.

Meinhardt wanted to standardise and control

the way in which light bulbs were manufactured.

In 1924, the world's biggest electrical companies

hammered out a deal in Geneva.

Its aim was to increase profits by fixing prices and production quotas.

It would also dictate the length of time a light bulb could last.

What's extraordinary is that the rules

governing the way the cartel would control production

were all written down in minute detail.

These papers were discovered by German researcher Helmut Herger.

Helmut, how did you first come by these documents?

Well, I know after the Wall came down,

I knew the Workers Council people of the light bulb factory.

And when the factory closed down they saved the archive.

This first point is - one, control.

The life of general lighting service lamps shall be controlled.

Before the Phoebus Cartel existed, how long did a light bulb last?

The light bulbs lasted 2,500 hours. And after the Phoebus Cartel?

They reduced them down to 1,000 hours.

'The bulb that comes off the assembly line today

'has a filament of pure metallic tungsten

'that burns whitehot for 1,000 hours. '

Bulbs that lasted longer burned less brightly.

The companies maintain that the 1,000-hour life span

was a compromise between these two factors, durability and efficiency.

Yet the impact on sales was phenomenal.

The year the agreement was signed

one lighting company executive wrote...

And any company that broke the cartel was threatened with fines.

It's incredible, because actually

when you look at the rules that have been written down,

this is called "basis of fining,"

it says if it lasts 20 hours more. you'll be paying so much money,

50 hours more. a higher amount,

75 hours... Swiss money, yeah.

The Phoebus cartel was ended by the war.

But Helmut has uncovered hard proof of planned obsolescence.

And others are investigating how it operates today.

I've come to meet Stefan Schlegel at Berlin Technical University.

Stefan is studying obsolescence in consumer goods

and he's shocked by how pervasive it is.

Planned obsolescence is an open secret.

When I'm talking to professional management people at congresses

and so, they all say, "Well, we all know this. "

Stefan has identified obsolescence in everything,

from washing machines with heating elements which fail too early

to electric toothbrushes with sealed panels

preventing you from changing the batteries.

The clearest example of all is the printer cartridge.

This is from a printer, right?

Yeah, this is from a printer. It's a cartridge.

OK. And there is a counter inside. What does the counter do?

It counts the pages you've been printing with this cartridge.

So it is there. It's like a clock counting down to 50,000 pages.

And then it's saying, "I'm empty. "

And it's just this simple dial here

is effectively counting down to the moment that it stops working. Yeah.

So you can reset the counter, you know. You can reset it.

And a friend of mine just do it,

reset it, put it inside again and it's still printing.

And he's putting it down to zero,

reset it, for three times, and it's still printing.

That's... All you would have to do is reset it and it would work,

but instead you have to buy a brand-new cartridge?

A brand-new one or refilling it. Yeah.

This is planned obsolescence in the cartridge of a printer.

Obviously.

The open secret of planned obsolescence that Stefan talks about

is now becoming increasingly sophisticated.

Manufactures are even being accused of inserting electronic chips

into printers to tell us the ink has run out when it hasn't.

Planned obsolescence is now being woven

into the very fabric of our everyday lives.

We live in a world of products

designed to have a limited life span and accept it. But why?