Can Your Company Win With an Open Playbook?

In a story that's making the rounds today, a French McDonald's (NYSE: MCD  ) restaurant's employees freaked out about a customer's wearable computer device. Canadian cyber-scientist Steve Mann wears digitally enhanced eyeglasses 24/7 with notes from a doctor explaining that it takes "special tools" to detach the device from his skull. But the Parisian fast-food crew still tried to remove Mann's so-called EyeTap device by brute force before ripping up the medical note and throwing him out on the street.

I'd preface all of this with "allegedly," but Mann's glasses are programmed to store visual snapshots when the system is disturbed, so he's got pictures of the incident. Presumably, the McDonald's workers wanted to prevent exactly that kind of visual documentation for one reason or another, so it's safe to say that their actions backfired.

McDonald's has opened an investigation into the incident and promised to take "appropriate measures." Mann is not asking for huge damages -- only enough to repair his broken equipment, and "it would also be nice if McDonald's would see fit to support vision research."

Why should I care about Steve Mann's glasses?
Maybe this is a storm in a teacup for now, but the incident raises a much bigger question. Mann's gadgets may become commonplace in the next few years as Google (Nasdaq: GOOG  ) has already presented its Google Glass device and even Apple (Nasdaq: AAPL  ) filed patents on a similar design. The question is not what wearable computers can do for you. Smartphones have already turned mobile computing upside down, and that's just the beginning.

No, the real issue goes deeper into the human psyche. What happens when everyone is recording everything around them, all the time? Your life could be broadcast day and night, by your own wearable computer or other people's -- or by nano-sized surveillance drones as ubiquitous as oxygen.

McDonald's will have to get used to digital cameras in Paris and elsewhere. So will everyone else. Secrets become open books. Privacy? Ancient history. Same thing with proprietary business secrets. Leaks are already common enough, but that will soon be the norm.

Will your stock sink or swim?
Some companies will thrive in an open world like that, because they've already gotten used to the idea of open secrets. Red Hat (NYSE: RHT  ) is the prime example of this, giving away software for free and selling top-shelf support services instead. Netflix (Nasdaq: NFLX  ) runs its video services on industry standard platforms and is happy to share the technical details of how it's done -- the real value here comes from astute deal-making and second-to-none packaging. These companies will do fine when Steve Mann's augmented reality turns mainstream.

Apple is an extreme example of the opposite. The company cherishes its secrets and will probably build chip-factory clean rooms for its board meetings before letting outsiders in on upcoming attractions. That strategy is serving Cupertino well at the moment, but I don't think it can last. The company must adapt to some difficult new realities, or lose out to competitors who are nimbler and better prepared.

Fool tech guru Eric Bleeker is willing to take his chances on Apple, at least for now. In a premium report on the world's biggest and richest company, Eric explains why the Cupertino giant still looks unstoppable -- and the report even comes with a year's worth of free research updates so you'll be up to date in case Eric changes his mind.

Fool contributor Anders Bylund owns shares in Google and Netflix, and has also created a bull call spread on Netflix. He holds no other position in any of the companies mentioned. Check out Anders' holdings and bio, or follow him on Twitter and Google+. The Motley Fool owns shares of Google, Netflix, Apple, and McDonald's. Motley Fool newsletter services have recommended buying shares of Netflix, Apple, Google, and McDonald's. Motley Fool newsletter services have recommended creating a bull call spread position in Apple. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinion, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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