The 15 Biggest Tech Disappointments of 2007

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#5. The Great, The Bad, The Ugly: Apple iPhone

Yes, we know. Sliced bread only wishes it were as great as the iPhone. And aside from minor flaws like a tiny touch keyboard and lack of Flash support, the phone itself is pretty terrific. But AT&T's broadband service? Definitely second-rate. And if you want to switch to a more reliable or faster carrier, you have to take your chances with the hackers.

The $600 price tag--which soon dropped by $200 and then was followed by a $100 quasi-rebate--didn't help. "I think the biggest debacle of 2007 is the iPhone pricing bait and switch," says Peggy Watt, a PC World contributing editor and professor of journalism at Western Washington University. "People do expect tech prices to drop, but not as quickly as the iPhone did. Apple's response was pretty lame, too; a partial credit that couldn't be used for a lot of popular items (such as iTunes)." 

Worse, those who did try to open their iPhones to other carriers or third-party applications found themselves owners of $600 iBricks when Apple tweaked the firmware to lock them out.

Memo to Apple: It's time to treat iPhones for what they really are--pocket computers with phone functions built in--and open them up the world. Just a thought.

#4. In a Sorry State: Yahoo

We can't say we really expected much out of Yahoo in 2007. Giving CEO Terry Semel the boot was probably a good thing--especially after his $230 million compensation package came to light. Installing the original Yahoo, Jerry Yang, as head honcho also seems like a smooth move, even if the company seems permanently stuck in the number two position behind Google.

Yet there's one area where Yahoo can lay claim to being number one: creating political prisoners. At least three times over the past five years, information supplied by Yahoo to the Bejiing government has led to the incarceration of Chinese dissidents.

This year, Yahoo executives admitted they'd lied to Congress when they claimed not to know why the Chinese demanded their subscriber data. Yang and general counsel Michael Callahan were forced to deliver a humbling public apology in front of a Congressional committee. Shortly thereafter, the company settled a suit brought by two of the dissidents' families.

Not so smooth.

#3. The Anti-Social Network: Facebook Beacon

We have to give props to Facebook for stealing the social networking spotlight from MySpace this year. But once it got up on stage, Facebook laid an egg. For example, opening up the Facebook platform to third-party developers was inspired. Now, six months later, those viral-to-the-point-of-influenza Facebook apps are mostly just irritating. (For the 27th time: No, I do not want to spam everyone in my network with another movie quiz, thank you. Now go away.)

The introduction of Facebook's Beacon advertising program was more than disappointing--it was disturbing. Suddenly, anything you purchased on Amazon, Overstock, Fandango or three dozen other sites would be broadcast to your Facebook friends. Worse, even when you were logged out, Facebook still gathered the information, though the company says it didn't use the data.

CEO Mark Zuckerberg apologized and offered subscribers easier ways to opt out of Beacon, but the damage was already done, says Richard Laermer, principal at  RLM PR in New York and author of Punk Marketing.

"The idea behind Beacon is fascinating, but the fact that it was being done for subscribers by someone else was less than cool," he says. "It's like me fishing in your trash can for your store receipts (you haven't spotted me yet?) and then telling other people what you've bought. Not illegal, but oh so creepy."

How much damage has Beacon done to Facebook's rep? "Their PR value just went down about 40 percent," he adds.

#2. What Is It Good For: The High-Def Format War

February 2007: Sony declares its Blu-ray the winner of the hi-def format wars.

April 2007: Toshiba announces its HD DVD player is the first to sell more than 100,000 units. 

July 2007: Blockbuster Video says it will carry only Blu-ray discs in more than 1400 of its retail outlets.

August 2007: Paramount and DreamWorks announce exclusive support for the HD DVD format.

September 2007: God help us, a third HD format has emerged: HD VMD (Versatile Multilayer Disc).

Enough already.

Did we learn nothing from VHS vs. Betamax, CD-R vs. CD-RW, DVD-A vs. SACD, and so on down the line?  At least the warring DVD camps worked out a compromise in the mid-90s that allowed everyone to profit from the new movie format (though it took them a while). Not so in HD land, where a take-no-prisoners attitude on both sides has left consumers cold. It will be a snowy day in Video Hell before we'll put our money down on either format.

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